Today, the release of non-farm payrolls has been the highlight of the week. Everyone has been waiting to see what they would show, since employment is a huge indicator for the economy. And there had been hopes of an improvement. However, with the latest loss of 190,000 jobs, the unemployment rate has risen to 10.2%.
Indeed, this week's job losses bring the total since the beginning of the recession to 7.3 million. Additionally, the fact that the unemployment rate broke through 10% is also big news. Some economists have been saying that such a level has been likely since the beginning of the recession, and many have said that we won't see a turnaround until after unemployment as reached 10%. MarketWatch offers this additional look at the jobs picture:
An alternative gauge of unemployment, which includes discouraged
workers and those forced to work part-time, rose to 17.5%, the highest
on record dating to 1995.
Total hours worked in the economy fell 0.2%. The average workweek was
steady at a record-low 33 hours. Average hourly earnings rose 5 cents
or 0.3%, to $18.72. Average hourly earnings are up 2.4% in the past
year.
This new unemployment level also has other implications for the economy. With unemployment so high, it is likely that consumer spending will likely remained curbed, and that we will see more difficulties in the housing market as those who continue to lose their jobs find it hard to make mortgage payments.
As a result, it is little surprise that risk aversion is setting in, and the U.S. dollar is starting to rally again.
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