It’s not my intention to load up my blogs with bad news but it just keeps coming, hand over fist, faster than I can write it down. This week the Labor Dept released employment figures that were far worse than anyone expected.
Joblessness soared and employers cut back in March, the deepest job losses in five years and strong evidence that the housing and financial market distress has spooked employers.
The Labor Department numbers released yesterday were far worse than economists had forecast. The unemployment rate rose to 5.1 percent from 4.8 percent in February and 4.4 percent in March 2007. Employers reduced their payrolls by 80,000 jobs in March, the third straight month of decline. And the department revised the previous two months’ employment levels down by 67,000 positions.
“We’re in recession,” said David Wyss, chief economist of Standard & Poor’s. “It’s hard to conclude anything else.”
Yes, well, when it gets to the point that professional Bush cheerleader and Fed Chief Ben Bernanke is forced to admit in front of Congress that the R-word is indeed in force, you know it’s beyond bad and heading for really really awful.
Mind you, the 80,000 jobs lost in March (don’t you just love that “reduced their payrolls” dodge? It’s like firing people and telling them they’re not really fired, they’ve been “involuntarily leisured”. That’s right-wing PC.) were on top of the 63,000 lost in February, making the grand total for just the last 2 months some 143,000 jobs down the Bush spout.
All of which makes the Admin’s prediction that job losses for the entire year will top out at 2-300,000 kind of, you know, rosy.
300,000 jobs lost is the upbeat projection?? Only in Bush’s America.
This wouldn’t be such a problem if new jobs were being created alongside the lost ones only in different fields, but that isn’t what’s happening. The economy is so bad right now (the Dow went in the tank again Friday) that businesses are reluctant to expand and no new industries have appeared (possibly because govt R&D, which corporate America generally feeds off of like sharks on minnows, has been cut to the bone for nearly a decade) to take their place.
Among the latest to cut jobs: GE Healthcare Information Technologies in Tampa notified the state this week that it was laying off 72 workers that helped design patient monitoring systems used in hospitals. Mercury Insurance Group in Clearwater said it is laying off 58 workers in its call center and billing departments.
In the meantime, few new jobs are being created, Brown said. “The problem here is a lack of new hiring, rather than job losses.”
The WaPo’s Neil Irwin & Michael Fletcher for a change do a pretty neat job of laying out the chain of effect.
The report shows how the problems in the housing and financial markets are rippling through other sectors, reflecting the deep connections between seemingly separate parts of the economy.
The number of construction jobs, which has declined steadily for 18 months, continued to fall. That sector shed 51,000 positions, as fewer homes are being built.
Fewer houses mean less construction and building materials; the number of manufacturing jobs fell 48,000, with some of the steepest losses among makers of lumber, drywall, and other materials. Automakers also cut jobs.
With their homes less valuable, U.S. consumers seem to be spending less, which means stores need fewer workers. The number of retail jobs fell 12,400, with the steepest losses in sellers of building materials and appliances, which are strongly tied to the housing business.
Financial firms cut 5,000 jobs, with the biggest losses in “credit intermediation” companies, which includes banks and mortgage brokers.
This has caused businesses that have little to do with housing to become less confident about the future. Professional and business services, a sector that had been keeping the economy afloat, trimmed 35,000 jobs.
Yup, that’s pretty much how she blows. Which is, no doubt, why Sen Chris Dodd – the guy we didn’t want to be president – is trying to pass a bill to do what the DLC/BD Alliance has so far refused to do: help the homeowners instead of the bankers.
The chairman of the Senate Banking Committee, reacting to criticism that a bipartisan housing bill would do little for homeowners facing foreclosure, vowed yesterday to move quickly on broader legislation to help troubled borrowers get cheaper mortgages backed by public funds.
Sen. Christopher J. Dodd (D-Conn.) said he will hold hearings next week on the measure, which is aimed at assisting distressed borrowers, particularly those who owe banks more than their homes are worth because of plummeting prices — an issue at the heart of the nation’s housing crisis. Under the proposal, the Federal Housing Administration would encourage lenders to forgive a portion of the loans and issue new, more affordable mortgages in exchange for the federal government’s financial backing.
Barney Frank is working on a similar bill in the House. The GOP/DLC/BD/Corporate Alliance is gearing up to torpedo both of them.
Hang onto your hat, everybody. It’s going to be a bumpy ride.