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Employers cut 49,000 jobs in May

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The U.S. unemployment rate increased from 5 percent in April to 5.5 percent in May as companies shed 49,000 jobs compared with 28,000 jobs in April. The increase is the biggest monthly rise in unemployment since 1986, according to USA Today.

"The report has recession written all over it," says Mark Zandi, chief economist for Moody's Economy.com. "It's a big job decline, a large increase in the unemployment rate across all industries and the U.S."

The 5.5 percent unemployment rate is the highest since October 2004, and the number of unemployed individuals increased from 6.9 million one year ago to 8.5 million in May. Meanwhile, the labor force—including individuals looking for jobs—increased 577,000 to 154.5 million.

The construction industry was hit hard with 34,000 job losses; it has cut 475,000 jobs since September 2006. Manufacturing lost 26,000 jobs, and professional services lost 39,000 jobs. Some gains were experienced in industries such as education, health and government.

So far this year, job losses have totaled 324,000. The unemployment rate is expected to increase to 6 percent or higher in early 2009.


6/11/2008

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