US unemployment rate in shock fall

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The Labor Department has revealed some good news for the world’s largest economy today, showing that the 247,000 jobs were lost in July – much less than analysts had forecast.

The decline meant the unemployment rate dropped from 9.5% in June to 9.4% in July – the first fall since April 2008.

Analysts had expected the so-called ‘non-farm payroll’ to fall by 320,000 during the month, with the unemployment rate rising a notch to 9.6%.

Since the onset of the recession in December 2007 – approximately 6.7 million jobs have been lost in the US economy, according to the Labor Department.

In the meantime, revised figures show that fewer jobs were lost in May and June, with 303,000 posts lost in May – less than the 322,000 previously estimated. 443,000 positions were axed in June – revised from an earlier estimate of 467,000.

There was other positive news after workers’ hours crept up after falling to a record low in June, while wages rose after having fallen.

In related news today, the US Government’s Car Allowance Rebate System (CARS), branded the “cash for clunkers” scheme has received an additional $2 billion (£1.19 billion) – approved by the US Senate, after an initial $1 billion ran out in just 10 days.

The “cash for clunkers” scheme has been designed to help bring the US economy out of recession by boosting new car sales. Car owners can receive federal subsidies of up to $4,500 (£2,600) for trading in their old cars for new ones.

The scheme is proving successful after July has been the best month for sales in almost a year.

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