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The 10.2 percent October unemployment rate, the highest level since 1983, has cast a pall over the prospects for a sustained recovery, put Democratic members of Congress facing re-election next year in jeopardy, and it risks further erosion of President Barack Obama's popularity.
And prospects for improvement over the next few months remain in doubt.
"We will certainly have very bad payroll numbers in November and December," said Harm Bandholz, an economist at UniCredit Global Research in New York, whose forecast for a 10.1 percent unemployment rate matched the highest among economists surveyed by Bloomberg News. "We don't foresee businesses going on a hiring spree anytime soon."
Unemployment numbers in Utah during the same period won't be released until mid-month. The state's September rate was 6.2 percent, fourth lowest in the nation but up markedly from 3.4 percent a year earlier, according to the Department of Workforce Services. At 6.2 percent, Utah had 84,332 unemployed workers out of a labor force of 1.37 million.
Nationally, a U.S. Labor Department report showed that payrolls fell by 190,000 last month, and the jobless rate rose from 9.8 percent a month earlier. Payrolls had been forecast to drop 175,000, according to the median estimate of 84 economists surveyed by Bloomberg News. The jobless rate was projected to rise to 9.9 percent.
The figures prompted Obama, who signed a bill Friday extending jobless benefits,
Obama also signed a measure that extends a tax credit of up to $8,000 for homebuyers and benefits for unemployed workers, and he promised to pursue further measures to create jobs.
"My economic team is looking at ideas such as additional investments in our aging roads and bridges, incentives to encourage families and business to make buildings more energy efficient," additional tax cuts, and more steps to ease the flow of credit to small business and promote exports, he said today at the White House.
For congressional Democrats facing challengers in midterm elections next year, the continuing erosion in the job market puts them at political risk. Voters on Nov. 3 overwhelmingly cited unease with the economy and worries about jobs as they ousted the Democratic governor of New Jersey and installed a Republican governor in Virginia after eight years of Democratic rule there. Obama carried both states in 2008.
The entire House of Representatives, 34 senators and 37 governors are up for re-election next year.
Since Obama took office in January, the economy has lost 3.49 million jobs. The U.S. economy has lost 7.3 million jobs since the recession began in December 2007, when the unemployment rate stood at 4.9 percent.
The administration said last week that the $787 billion stimulus package plan signed into law in February was directly responsible for saving or creating about 640,000 jobs.
Some people are pulling up stakes and moving to where they think the job prospects may be brighter, and the average work week held at a record low of 33 hours in October, while average weekly earnings rose to $617.76 from $616.11 a month earlier. Workers' average hourly earnings were 2.4 percent higher than October 2008, the smallest gain since 2004.
Factory payrolls dropped 61,000 after decreasing 45,000 in the prior month, Friday's report showed. The median forecast by economists called for a drop of 42,000. The decline included a gain of 4,600 jobs in auto manufacturing and parts industries.
The unemployment rate rose to 10.2 percent in October -- a 26-year high -- as employers continued to cut jobs.
The economy grew in the third quarter, but with 15.7 million Americans unable to find work the recovery remains fragile.
The unemployment rate is forecast to keep rising, perhaps above 10.5 percent. Some economists say a return to pre-recession employment levels could take five years.
