Job Losses Up Sharply Last Month; Fed Cuts Key Rate Again; Skinner Says Economy `Staggering'
The Labor Department reported yesterday morning that the number of jobs in the United States plunged by about a quarter million in November, and within hours the Federal Reserve took steps to lower a key interest rate.</br></br>Although the nation's unemployment rate remained steady at 6.8 percent in November, economists, politicians and financial markets saw the steep drop in the number of construction, factory and retail jobs as a further sign of what President Bush's new chief of staff, Samuel Skinner, yesterday called a "staggering" economy.</br></br>The total number of payroll jobs, which usually closely tracks the rise and fall in the economy, is at its lowest point since the beginning of the recession.</br></br>"This is hard evidence that this recession is still going," said Joseph Carson, chief economist for Chemical Bank. "Now 16 months long, it is tied with the two longest recessions since World War II." "This is clear confirmation that the recovery has stalled," said Lyle Gramley, a former Federal Reserve governor and chief economist for the Mortgage Bankers Association of America. "We now have to think about a fourth quarter in which we have no growth at all."</br></br>David Hale, an economist with Kemper Financial Services Inc. in Chicago, said the "odds are very high of one or two more negative quarters."