Out of a Job? You and 49,000 Others This Month
The jobless rate jumped to 5.5% in May, with reports of another 49,000 pink slips being handed out with paychecks. This marks the highest rate of unemployment since 1986. Is it time to say “recession”?
The latest snapshot of business conditions showed a deeply troubled economy, with dwindling job opportunities in a time of continuing hardship in the housing, credit and financial sectors.
It’s the trickle down effect. Following the housing and banking crises, employers are getting antsy. When employers get antsy about their businesses, they start cutting back. Cutting back means laying off employees. Laying off employees means less money to spend in the open marketplace. Less money to spend at the store and employers lay off more workers and in expanding sectors. We are in the recession spiral.
How has the announcement hit the nation today?
On Wall Street, stocks slid. The Dow Jones industrials tumbled more than 200 points in morning trading.
The big jump in the unemployment rate surprised economists who were forecasting a tick-up to 5.1 percent. Payroll losses, however, weren’t as deep as the 60,000 that analysts were bracing for. Still, job losses in both March and April turned out to be larger than the government previously reported. Employers now have cut payrolls for five straight months.
The White House expressed disappointment, too.
If there is one upside, it is that the inhabitants of the disappointed White House will soon be unemployed along with the rest of us.
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