By Mike Caggeso
The U.S. unemployment rate rose to 7.6% in January, the highest level since 1992, as payrolls knocked off 598,000 jobs to start the year.
The nearly 600,000 jobs is the biggest monthly loss since December 1974. Since the recession began in December 2007, 3.6 million jobs have been lost. Worse, about half of those jobs were cut in the past three months, the U.S. Department of Labor reported.
Nearly every major industry shed jobs in January. Manufacturing employment fell 207,000. Durable goods cut 157,000 jobs. Construction loss 111,000, bringing its total to 1 million since peaking in January 2007. Nondurable goods shed more than 50,000.
Private education and healthcare were the only sectors that added jobs, 33,000 and 19,000, respectively, the Labor Department said.
"Let's not mince words, conditions in this economy are bad and are deteriorating," Joel Naroff, president of Naroff Economic Advisers, wrote in a note to clients. "The depth and extent of the cuts is breathtaking and seems to indicate that every executive that is not named Rip Van Winkle has decided to act and act right now."
Naroff said there's a chance that the spike in layoffs could mean job cuts will slow in the spring. But regardless, our elected officials should focus on the data today. If anything, the report puts the continuing stimulus debate in Congress under a brighter spotlight.
"This truly disturbing employment report should make it clear that the economy needs both a jump start and a confidence boost," Naroff said. "If there ever is an infrastructure stimulus bill passed, there will be plenty of workers to do whatever needs to be done."
No coincidence, the Senate resumed their debate on the $800 billion-plus stimulus measure soon after the Labor Department's report.
President Barack Obama quickly jumped on the data, too,the Associated Press reported
"These numbers demand action," Obama said. "It is inexcusable and irresponsible to get bogged down in distraction and delay while millions of Americans are being put out of work. It is time for Congress to act."
And while Obama said it'll take years to renew the U.S. economy, "every day that Washington fails to act, that recovery is delayed."
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The Employment Situation: January 2009