The unemployment rate of US climbed 0.8 per cent in December, the highest in six years, as businesses cut 124,000 jobs and the year ended with the job market in the depths of recession. The unemployment rate was up 0.2 percentage points from a revised 5.6 per cent in November, the Labor Department reported Friday. Since the recession began in March, businesses have slashed 1.4 million jobs. December`s loss of 124,000 jobs reflected continued declines in manufacturing, retail, air transportation and temporary employment services. But the hemorrhaging slowed somewhat last month. Job losses had averaged about 400,000 a month in October and November.
The last time the nation`s unemployment rate stood at 5.8 per cent was March 1995. It hit 5.9 per cent in September 1994.
But 2001 was a particularly bad year for manufacturing, which shed 1.3 million jobs - or about 7 per cent of its work force. Many manufacturing companies lost more than one in 10 of their workers last year, mainly in furniture, metals, industrial machinery, textiles and apparel. A sliver of hope for manufacturing appeared in December`s employment report, as the factory workweek increased by 0.4 hour to 40.7 hours and factory overtime rose 0.2 hour to 3.9 hours.
December declines also were heavy in retail with 77,000 job cuts, particularly at general merchandise stores and retailers such as toy stores and jewelry stores, both of which fell short of their typical holiday hiring.
Those declines were tempered slightly by job gains in auto dealerships as free financing beckoned customers. During 2001, retail had added 200,000 jobs by July, but losses since then have left employment down by 73,000 during the year. Bureau Report