just as workers face record-high prices for gasoline and food.
The unemployment rate stayed steady in June at 5.5 percent, the highest level in four years. The elevated figure dispelled speculation among some economists that last month’s half-percentagepoint jump, the biggest monthly spike in 22 years, was a statistical anomaly.
Yikes - lasting into 09? I mentioned in my post concerning the outreach with the Health department ladies that Tent City is bursting at the seams.
People are calling me every day now that I've never spoken to previously, all looking for answers on how to stave off homelessness as they see their hours cut, their jobs end, their unenjoyment run out and their bills mount.
Sigh.I got nuthin for em but bad news, with worse news to follow when they have to vacate their happy homes....
Employers Cut Workers for a Sixth Month
About 62,000 jobs disappeared in June, the government reported Friday, the sixth consecutive month that payrolls have declined, as businesses rushed to lay off workers amid the worst economic climate in a generation.
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The Labor Picture in June
Back Story with Louis Uchitelle (mp3)Deepening Cycle of Job Loss Seen Lasting Into ’09
And as job losses mount, even those still on payrolls have felt the pain: employers are cutting hours for their full-time employees and shrinking salaries, just as workers face record-high prices for gasoline and food.
The unemployment rate stayed steady in June at 5.5 percent, the highest level in four years. The elevated figure dispelled speculation among some economists that last month’s half-percentage
Indeed, employers have been steadily shedding jobs for the last three months. Businesses cut 52,000 more workers in May and April than the government first thought, the Labor Department said, casting aside initial estimates that suggested some deceleration.
In the last 12 months, the economy had seen a net gain of only 15,000 jobs, the lowest net increase since November 2003.
In the last 50 years, the economy has entered a recession every time jobs have dropped for six consecutive months.
And most Americans who are still employed earned less money in June than they did a year ago. Wages, which have been steadily shrinking in recent months, took a sharp hit last month, growing at the slowest pace since September 2005.
Among rank-and-file workers, who make up the majority of the nation’s work force, weekly paychecks have grown 2.8 percent in the last 12 months. That was down from 3.2 percent in May and well below the rate of inflation.
Average hourly earnings grew 3.4 percent, the slowest pace since the start of 2006.
The drop in payrolls was in line with many economists’ forecasts, and stocks on Wall Street were trading higher on some relief that the June numbers were not worse.
The presumptive presidential candidates quickly weighed in on the numbers, with each calling for changes that fell along ideological lines.
“At a time when our small businesses need support from Washington, we cannot raise taxes, increase regulation and isolate ourselves from foreign markets,” Senator John McCain, the Republican candidate, said in a statement. He called for tax relief, job creation, and investment in innovation.
Senator Barack Obama, the Democratic candidate, attributed the downturn to “the failed economic policies of the past eight years” and said his opponent “has fully embraced the Bush economic agenda.”
“I’m calling on Congress and the president to enact real, immediate relief with energy rebates for working families this summer, a fund to help families avoid foreclosure, extended benefits for the long-term jobless, and assistance to states that have been hard-hit by the economic downturn,” Mr. Obama said.
June’s job losses affected a range of industries, including banks, construction companies, manufacturing firms and car dealerships. Janitors and administrative workers were the hardest hit, with about 70,000 workers losing their jobs last month alone. Temp agencies lost 30,000 jobs.
Among the few businesses still hiring were restaurants, government agencies and health care companies. Mining companies also added workers last month.
“The weak bargaining power of most workers means they are subject to pressures from three sides: declining jobs and hours, slower hourly wage growth, and faster price growth,” Jared Bernstein, of the Economic Policy Institute, wrote in a note. “This punishing combination is lowering their living standards.”
Jan Hatzius, chief domestic economist at Goldman Sachs, said the weak report suggests that the Bush administration’
“It is a sign that the fiscal stimulus, the tax rebates, are not having much of an impact on the broader economy,” Mr. Hatzius said.
And there is little relief on the horizon. The softening job market has prompted millions of families to reduce their spending, further hurting businesses and the economy as a whole. Soaring prices for food and gasoline are overwhelming modest wage gains for most workers, leaving households with even less money to spend.
“The labor market is clearly deteriorating, and it’s highly likely to keep deteriorating,”
The national unemployment rate climbed a full percentage point over the last year. That does not include people who are jobless and have given up looking for work, or people who have been bumped to part-time jobs from full time. Add in those people and the so-called underemployment
A separate report on Thursday revealed unexpected weakness in the services sector. An activity index devised by the Institute of Supply Management dropped to 48.2 in June from 51.7 in May, on a scale where readings under 50 show contraction. Businesses were pressured by significantly higher prices and a drop-off in customer demand. Employment levels fell as well.
