Jobless figures rose yet again in June, inching up to a 26-year high of 9.5% and offering little reason for optimism that the stimulus plan passed by Congress earlier this year is bearing fruit.
Employers cut 467,000 jobs last month, kicking the unemployment rate up a tenth of a percent and raising the prospect that double-digit unemployment could await. The payroll drop was worse than expected and followed a 322,000 drop in May, according to Labor Department figures released today in Washington.
In a White House interview with The Associated Press, Obama said that since he took office, "we have successfully stabilized the financial markets," and "started to see some stabilization on housing."
"But what we are still seeing is too many jobs lost," the President added.
Unemployment is now at its highest since August, 1983. It is projected to keep rising for the rest of the year just as the income boost from the stimulus package fades, undermining prospects for a sustained rebound, analysts told Bloomberg News. said.
"Payrolls will be going down the rest of the year and the unemployment rate will be rising,'' Wachovia chief economist John Silvia told Bloomberg. "The challenge for the Obama administration is that we'll have positive economic growth but still no job growth. It's going to be tough on them.''
The world's largest economy has lost about 6.5 million jobs since the recession began in December 2007. That's the biggest drop in any post-World War II economic slump. More firings are in the works following the bankruptcies of GM and Chrysler as shutdowns ripple through auto-parts makers and car dealers.
It may not get better anytime soon. Even if the economy improves and the U.S. sees growth in gross domestic product, it may not mean jobs return right way.
Unemployment will "remain painfully high for several more years,'' Federal Reserve Bank of San Francisco President Janet Yellen said this week. "I expect that we will turn the growth corner sometime later this year, but I am not optimistic that the economy will spring back to normal any time soon.''
Today's labor report also showed the average work week fell to 33 hours, the lowest level since records began in 1964, from 33.1 hours in May. Workers' average hourly wages held at $18.53 for a second month.