| | |  Business News | May 2009 
US Unemployment Rate Rises as Pace of Layoffs Slows
 Annys Shin & Scott Wilson - Washington Post
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| | At Virginia Tech University, job seekers enter the National Capital Region Job Fair. Although layoffs have decelerated, unemployment continues to increase nationwide. (Jonathan Ernst/Reuters) | |
The ranks of Americans looking for work continued to swell in April, as the nation's unemployment rate rose to 8.9 percent, the Labor Department reported this morning.
Although it is the highest jobless rate since September 1983, the pace of job losses slowed appreciably last month compared with February and March, another sign that the severe economic slump might be starting to ease.
President Obama later addressed the unemployment issue in a speech, announcing several modest steps to make it easier for those looking for work to retrain without losing jobless benefits.
The unemployment rate "underscores the point that we're still in the midst of a recession that was years in the making and will be months or even years in the unmaking; and we should expect further job losses in the months to come," Obama said. Nevertheless, he said, "the gears of our economic engine are slowly beginning to turn."
The number of private-sector jobs fell by 611,000, the Labor Department report said, but that loss was offset somewhat by the addition of 72,000 government jobs - most of them connected with the 2010 Census. The total of 539,000 jobs lost was slightly less than the 600,000 expected by analysts.
Some experts predicted the jobs report would beat expectations after the ADP Employment Report released earlier this week showed a job loss of 491,000 in April, far lower than the 600,000-plus tallies seen in prior months.
A separate report from outplacement consultancy Challenger, Gray, & Christmas also found layoffs had moderated to 133,000, from 150,000. And first-time jobless claims fell sharply last week, further suggesting job losses could be moderating.
But the report today confirmed businesses were still in cost-cutting mode in April.
The number of Americans who are officially unemployed now stands at 13.7 million. The Labor Department also revised its estimates to show steeper job losses in months leading into April - 681,000 non-farm jobs lost in February, up from an earlier estimate of 651,00, and 699,000 fewer jobs in March, compared with the initial estimate of 663,000.
To be counted as unemployed in the jobs report, a person must not be working currently and must have looked for work in the past four weeks.
An alternative measure of unemployment includes other groups, such as people who have become discouraged and stopped looking and people who are working fewer hours than they would like for economic reasons. If those groups are included, the unemployment rate in April was 15.8 percent, up slightly from 15.6 percent in March.
The jobs report showed it has become increasingly more difficult to find employment, with the median amount of time out of work edging up to 12.5 weeks, from 11.2 in March.
Analysts expect unemployment to persist well into the recovery, which they say probably will be sluggish. That has implications for broader economic growth by slowing wage growth, dampening consumer spending, and helping fuel foreclosures and loan defaults.
Federal Reserve Chairman Ben S. Bernanke on Tuesday offered a somewhat optimistic outlook on the economy but said unemployment would likely hover around 9 percent for many months.
Obama, who is facing rising Republican criticism about unemployment, has ordered the Department of Labor to advise state agencies to change rules that eliminate jobless benefits for unemployed people who enroll in school.
State agencies often require anyone receiving unemployment benefits to be looking for work full-time in return for the assistance. Obama wants state agencies to grant more leeway to unemployed people who enroll in part-time retraining programs so they can keep their benefits while going to school.
Obama also has asked all state labor agencies to send letters outlining the array of aid, retraining programs, and other assistance available to anyone receiving unemployment benefits. The federal Departments of Labor and Education have created a Web site to explain some of these measures.
"We're moving forward because now is not a time for small plans," Obama said at the Eisenhower Executive Office Building. "It's not a time to pause, to be passive or to wait around for our problems to fix themselves. Now is the time to put in place a new foundation for growth - to rebuild our economy, retrain our workforce, and reequip the American people."
Obama added: "In a 21st century economy where the most valuable skill you can sell is your knowledge, education is the single best bet we can make - not just for our individual success, but for the success of our nation as a whole." He called for "a rigorous new approach to higher education and technical training," which he said "starts by changing senseless rules that discourage displaced workers from getting the education and training they need to find and fill the jobs of the future." |
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