Here comes figures indicating that 533,000 jobs were lost in November, the biggest single month of losses since 1974, taking unemployment to 6.7%, the highest since 1993.
This unemployment rate does not include those too discouraged to look for work any longer or those working fewer hours than they would like. Add those people to the roster of the unemployed, and the rate hit a record 12.5% in November, up 1.5 percentage points since September. The share of all men aged 16 and above who are working is now at its lowest level since the government began keeping statistics in the 1940s. The number of people working a part-time job, counted as employed, because they couldn’t find a full-time job rose by 621,000 last month. 1.2 milion jobs have been lost in the three months of September-November.
The rising job losses will increase the pressure to mount a large enough fiscal stimulus. Jan Hatzius of Goldman Sachs estimates the need for a $1.2 trillion stimulus for the next two years, in order to offset private sector retrenchment. Meanwhile the growth forecast is that the US economy will continue to decline throughout 2009, at about 2%.
Paul Krugman says that the employment-population ratio, the ratio of employed Americans to the adult population, had been declining since beginning of 2007, is now falling off the cliff! More on the dismal unemployment figures here.