Unemployment Climbs to 7.6 Percent

January brought unwelcome signs of an ever deepening recession, as unemployment reached 7.6 percent, up from 7.2 percent in December, and nonfarm payrolls fell by the largest amount in thirty-four years, the Labor Department reported Friday. Nonfarm payrolls plunged 598,000, after dropping 577,000 in December. Payroll employment has now declined a total of 3.6 million, representing about 2.6 percent of employment, since the start of the recession in December 2007, according to the report. If that’s not astonishing enough, about one-half of that 3.6 million decline occurred in the past three months. Job losses were “large and widespread across the major industry sectors,” in January. Manufacturing was particularly weak, experiencing its largest decline — 207,000 job losses — in 26 years, while construction was also hit hard, losing 111,000 jobs. But Profiles International Inc., specializing in the development of high-performance workforces through human resources management solutions, said some sectors of the economy remained vibrant; those included healthcare, transportation and Credit Unions, all of which added staff in January. Nonetheless, the number of long-term unemployed persons — those jobless for at least 27 weeks — sat at a whopping 2.6 million in January, similar to December’s reading. As for those who were employed, they might have seen their hours cut. Total hours worked in the economy fell by 0.7 percent in January, down 4.6 percent from a year ago. The average workweek clocked in at a record-low 33.3 hours. “The only positive of today’s report is that these ugly numbers put even more pressure on policymakers to finally agree on fiscal measures to stop the downward spiral of the economy,” wrote Harm Bandholz, economist for UniCredit Markets. The Senate is expected to vote on the newly proposed economic stimulus late Friday. The current bill has a price tag of over $900 billion, after several amendments were approved. Senate Majority Leader Harry Reid said Thursday evening that Democrats have enough votes to pass the bill in its current state. But under Senate rules, a few Republicans would need to join the Democrats to reach the 60-vote threshold and avoid a filibuster. “Every day, our economy gets sicker — and the time for a remedy that puts Americans back to work, jump-starts our economy and invests in lasting growth is now,” wrote Obama in an op-ed in the Post, as he urged a speedy passage of the bill. Write to Kelly Curran at kelly.curran@housingwire.com. Disclosure: The author held no relevant investment positions when this story was published. Indirect holdings may exist via mutual fund investments. HW reporters and writers follow a strict disclosure policy, the first in the mortgage trade.