2008 Worst Job Losses since World War II

by wildcherry on Friday, January 9th, 2009 | Business, News

WASHINGTON (MarketWatch) — The U.S. economy lost 524,000 jobs in December, closing out the worst year of job losses since World War II, the Labor Department said Friday.

Nearly 2.6 million jobs were lost in 2008, with 1.9 million destroyed in just the past four months, according to a survey of workplaces. It’s the biggest job loss in any calendar year since 1945, when 2.75 million jobs were lost as the wartime economy was demobilized.

The 1.5 million jobs lost in the fourth quarter were the most in any three-month period since 1945.

As a percentage of employment, job losses in 2008 totaled 1.8%, the worst since 1982 and the third-largest since the war.

The unemployment rate rose to 7.2%, the highest in 16 years. Unemployment increased by 632,000 to 11.1 million, according to the survey of households. That same household survey showed employment falling by 806,000 in December.

In 2008, the unemployment rate rose by 2.3 percentage points and unemployment increased by 3.6 million. Another 3.4 million workers were forced into part-time work during the year.

“Both the U.S. economy and job market fell off a cliff in September,” said Nariman Behravesh, chief economist for IHS Global Insight, who said the unemployment rate would rise to at least 9% by early 2010.

“The speed and the breadth of the deterioration in the U.S. economy since September are staggering,” wrote Richard Moody, chief economist for Mission Residential.

The grim report will increase pressure on Congress to quickly pass a major fiscal stimulus package to prop up the economy. President-elect Barack Obama has suggested the government inject as much as $800 billion into the economy over the next two years. The report “underscores the need for us to move forward with a sense of urgency and common purpose” to prevent the dire economic downturn from getting even worse, Obama said.

“It is now beyond rational debate that we need a significant infusion of public funds to work with the private sector so that we can restore economic growth,” said Rep. Barney Frank, D-Mass., chairman of the House Financial Services Committee.

“America cannot buy its way to prosperity with more and more government spending,” said House Republican Leader John Boehner of Ohio, who urged Obama and the Democrats to make tax cuts a central part of any plan.

“Even with passage of a large fiscal stimulus package, labor market conditions will continue to deteriorate through 2009,” Moody said.

The report was worse than expected, with payrolls in October and November revised lower by a total of 154,000 jobs. November’s loss was revised to 584,000, the highest in 24 years.

The number of people working part-time because of the slowing economy rose by 715,000 in December to 8.04 million.

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Tags: job data, job losses, labor department

2 Responses to “2008 Worst Job Losses since World War II”

1
warren lee Says:
January 10th, 2009 at 3:28 pm
Well, it’s not apples to apples when comparing the Great Depression to what it is now, 70-80 years ago. Population size of the US back then was around 120 million people compared to 300 million in 2006. 2006 GDP is 11,200 billion dollars vs 1925’s 750 billion dollars.
2
joboutlets Says:
January 21st, 2009 at 5:46 am
Everyone is expecting recession getting over soon. I have a very close friend, who graduated from Harvard. Worked for ML for over 8 years, recently he’s been “right sized” too, despite of his outstanding performance and the increasing revenue he generated. OMG, now the banking industry is badly hurt, how long it would take for those financial background guys like him get back to the job market. Banking jobs are not there as much as before as easily seen on http://www.joboutlets.com and other job sites in the region