Unemployment Reaches for the Sky as Economy Deteriorates

The American economy lost almost 600,000 jobs last month and the unemployment rate jumped to 7.6 percent, its highest level in more than 16 years, the Labor Department said Friday. Overall, the Labor Department reported that since the U.S. economy went into recession in December, 2007,

3.6 million jobs have been lost.

Businesses in all sectors except health care are cutting back on their payrolls. It is a major retrenchment and is still getting worse. The chart above shows the change in employment levels by month. Considering that the U.S. needs, on average, about 1.5 million new jobs each month in order to keep up with labor force growth, the effects on the economy are worse than the bar chart shows. As jobs become harder to get, as they are now, this discourages many workers from even looking for work. These “discouraged workers,” as they are called, are then no longer counted in the labor force—thus understating the unemployment levels.

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