US unemployment rate hits 8.5%
Figures from the Labor Department have revealed that the US unemployment rate rose from 8.1% in February to 8.5% in March – the highest level since 1983.
Since the recession took hold in December 2007 in the world’s largest economy, over 5 million jobs have been eliminated – with more than half of these (3.3 million) in the last five months alone.
Approximately 663,000 people lost their jobs last month, taking the number of unemployed to just over 13 million.
However, the figures for March were as economists had expected and therefore did not have a major impact on the stockmarkets.
According to the Labor Department, March’s job losses were “widespread across the major industry sectors.” However, the worst hit was the manufacturing sector with 161,000 jobs eliminated in March, while the construction sector axed 126,000 jobs – the majority of which were among speciality trade contractors.
Furthermore, 133,000 jobs were lost in the professional and business services sector, while retail lost 48,000. Leisure and hospitality lost 40,000 jobs – with the majority of these in the accommodation industry. Finally, around 34,000 workers lost their jobs in transport and warehousing.
Ian Shepherdson, chief US economist at High Frequency Economics, described the figures as “terrible.”
Meanwhile, Nigel Gault, chief US economist at IHS Global Insight, expects the US unemployment rate to reach a high of 10% before it falls.
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