According to US Department of Labor (DoL), December’s unemployment rate was 6% – like November, at the highest level since April and a marked increase from October’s 5.7%. (See November’s Unemployment Shoots Up ).
The jobs drop was the largest since February, when the economy sliced off 165,000 jobs. Not only that, but the DoL issued a revised figure for November’s payroll drop showing an 88,000 decline – sharper than the initially reported 40,000 drop. All in all, the economy shed a net 181,000 jobs during 2002.
Retail Sector Leads in Job Cuts
The DOL said the retail sector led December’s job losses. Department stores, toy stores and other retail outlets curbed hiring amid disappointing sales during the all-important holiday season, causing a seasonally adjusted 104,000 drop in retail payrolls.
December’s non-farm payroll drop was much weaker than the 22,000 job gain projected by economists in a Reuters survey.
All in all, Friday’s report was a sobering reminder that, despite occasional hopeful signs that the nation’s struggling economy is beginning a slow turnaround, significant weaknesses still remain.
Friday’s report follows word from the DoL Thursday that t he number of Americans seeking initial jobless benefits fell by 19,000 – more than expected – for the week ending January 4. (See Jobless Claims Fall Ahead of Forecasts ).
Also this week, President Bush signed a bill authorizing an extension of jobless benefits for up to 2.5 million Americans. (See President Inks Benefits Extension ).
The bill, which the DoL said had to be signed by Thursday to ensure no interruptions in benefit payments, provides 13 weeks of benefits for the unemployed who have exhausted their 26 weeks of assistance. An estimated 750,000 people will be immediately impacted, in addition to an estimated 1.6 million who are expected to become eligible.