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Jobless rate tops 10 pct. for first time since '83
The unemployment rate has hit double digits for the first time since 1983 -- and is likely to go higher. The 10.2 percent jobless rate for October shows how weak the economy remains even though it is growing. The rising jobless rate could threaten the recovery if it saps consumers' confidence and makes them more cautious about spending as the holiday season approaches.The October unemployment rate -- reflecting nearly 16 million jobless people -- jumped from 9.8 percent in September, the Labor Department said Friday. The job losses occurred across most industries, from manufacturing and construction to retail and financial. Economists say the unemployment rate could surpass 10.5 percent next year because employers are reluctant to hire. President Barack Obama called the new jobs report another illustration of why much more work is needed to spur business creation and consumer spending. Noting legislation he's signing to provide additional unemployment benefits for laid-off workers, Obama said, "I will not rest until all Americans who want work can find work." The government's monthly unemployment report is based on two surveys, one of households, one of companies' payrolls. The household survey showed that about 558,000 more people were unemployed last month than in September, raising the total to 15.7 million. The company survey, however, showed only a third as many job losses -- 190,000. The disparity can be explained by the fact that the company survey doesn't count people who are self-employed and undercounts employees of small businesses. That's why some analysts, like Diane Swonk, chief economist at Mesirow Financial, say last month's household survey could be an ominous sign for the economy. One struggling small business, Miller and Smith Inc., a home builder in McLean, Va., has trimmed its work force to about 97 from 350 at the height of the housing market in 2005. The company has been hurt by a slowdown in building and surging health care costs. Miller and Smith faced a 44 percent increase in the cost of health insurance over the past year that it managed to reduce to 23 percent. Posted by: Fred 2009-11-07 |
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