Consensus on unemployment peak is moving from a comfortable 7% to less comfortable 8%. Hoping (praying) carnage will stop there.
Unemployment curve currently tracking prior recessions. But worth remembering that trajectory is still similar to that following 1929. (And it’s for damn sure that, in 1929 and early 1930, no one expected unemployment to peak at 25%).
WaPo: Employers are moving to aggressively cut jobs and reduce costs in the face of the nation’s economic crisis, preparing for what many fear will be a long and painful recession.
The labour market has been weak all year, with a slow drip of workers losing their jobs each month. But the deterioration of the job market is now emerging as a driver of economic distress, according to a wide range of data and anecdotal reports from corporate America.
In September, there were more mass layoffs — instances in which employers slashed 50 or more jobs at one time — than in any month since September 2001, the labour Department said yesterday. And nearly half a million Americans have filed new claims for unemployment benefits in each of the past four weeks, the highest rate of such claims since just after the terrorist attacks seven years ago.
Anecdotal reports suggest that the hemorrhaging in the job market has only begun. Companies that announced plans this week to cut jobs include Internet company Yahoo (1,500 positions), pharmaceutical company Merck (7,200), National City bank (4,000) and Comcast, the cable company (300).
The weakening employment outlook is part of the reason that investors have become more fearful of a deep, prolonged recession — fears that led to yet another miserable day on Wall Street yesterday, with the Dow Jones industrial average down 514 points, or 5.7 per cent.
That’s a SOUP LINE INDICATOR up there, folks. Those are supposed to mark THE BOTTOM.
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