The number of Americans collecting unemployment benefits surged to a 26-year high as the labor market worsened in a yearlong recession.
Initial jobless claims unexpectedly fell by 24,000 to 467,000 in the week that ended Jan. 3, the lowest level in almost three months, the Labor Department said today in Washington. The total number of people getting benefits rose a week earlier to 4.6 million, the most since 1982.
While the government projects a surge in firings in late December and early January, job cuts may have come earlier last year as sinking sales and the worst credit conditions in seven decades forced companies such as General Motors Corp. and Chrysler LLC to pare costs. The claims report came as President- elect Barack Obama warned the U.S. risks sinking deeper into an economic crisis without a stimulus package of about $775 billion.
“The labor market is just hemorrhaging here,” said Joshua Shapiro, chief U.S. economist at Maria Fiorini Ramirez Inc. in New York, who correctly forecast claims would fall. “Just look at the continuing claims numbers, they give you a better idea of what is going on. Nobody can find work once they’re fired.”
This is not looking good.
However, I still think (maybe it's a wild hope) that we're in the absolute worst part of the storm right now. I am hoping it will get better by the end of the second quarter.
4 comments:
"we're in the absolute worst part of the storm right now."
Alternatively, we could be nearing the end of phase I. Phase II would be the Federal Government going belly up as the costs converge on years of Supply Side deficits, bailouts for criminal enterprises and futile attempts to borrow and spend our way out of the economic morass we are in as a result of over borrowing and over spending.
I will reiterate, we have been engaged in 8 years of reckless fiscal overspending with last year's deficit over 1 trillion dollars and interest rates have been coming down for 18 months. Even so the economic engine is stalling as we push harder on the gas. This is not your conventional recession. We must:
Cut spending for the Wars, empire building, homeland insecurity, CIA and defense by 500 billion.
Reverse the privatization efforts using crony capitalism and expunge the budget of unnecessary spending.
Return the tax format to the pre Bush structure. This includes so called middle class tax cuts.
End the bailouts for both corporations and individuals.
Enact a tax on gasoline high enough to discourage wonton consumption and make alternative sources viable.
Once these necessary items are in place well thought out infrastructure and alternate energy spending of a significant magnitude is in order. A large but temporary payroll tax cut limited to the bottom 85% of the income scale is advised. Targeted business tax cuts for real investment and job creation can be enacted.
Unemployment usually continues to rise even after recessions end. There's lots more left I fear....
Uh, oh. Things will get better in six months, you say? Are we going to have to call them Friedman-Bonddad Units now?
All kidding aside, I'm not nearly so optimistic. It'll be three or four Friedman Units... at least.
+1 to what olephart... say's.
The bush bunch's scorched earth policy has us in a very bad place.
I fear for the coming years, never mind the Friedman units.
Steve.
COAMO, PR
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