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Unemployment hits 14-year high
SHUTTING ITS DOORS: The Kmart store at 1920 W. Broadway in Mesa is closing.
Tim Hacker, Tribune
The nation's unemployment rate bolted to a 14-year high of 6.5 percent in October as 240,000 more jobs were cut, far worse than economists expected and stark proof the economy is deteriorating at an alarmingly rapid pace.
The new snapshot, released Friday by the Labor Department, showed the crucial jobs market quickly eroding. The jobless rate zoomed to 6.5 percent in October from 6.1 percent in September, matching the rate in March 1994.
Unemployment has now surpassed the high seen after the last recession in 2001. The jobless rate peaked at 6.3 percent in June 2003.
In Arizona, the latest jobless figure reported for September was 5.9 percent, up from 5.6 percent the previous month, but slightly below the national figure. October figures for the state will be released later this month.
Officials of the Arizona Department of Commerce have said they think the Arizona unemployment rate will rise to 7.5 percent next year.
In an indication of continuing trouble for the local economy, Honeywell Aerospace said this week it plans to cut 700 manufacturing jobs at the company's jet engine plant at Phoenix Sky Harbor International Airport and transfer the work to Mexico and the Czech Republic.
The move is needed to make the company more "globally competitive," said Honeywell spokesman Bill Reavis.
The transfers are expected to begin in the second quarter of 2009 and continue for three years.
October's employment decline marked the 10th straight month of payroll reductions, and government revisions showed that job losses in August and September turned out to be much deeper. Employers cut 127,000 positions in August, compared with 73,000 previously reported. A whopping 284,000 jobs were axed in September.
So far this year, a staggering 1.2 million jobs have disappeared. Over half of the decrease occurred in the past three months alone.
Although the unemployment report was worse than expected, and Ford Motor Co. reported dismal third-quarter results and announced plans to cut more than 2,000 additional white-collar jobs, Wall Street investors appeared to take it all in stride. The Dow Jones industrial average jumped 248.02 to close at 8,943.81.
About 10.1 million people were unemployed in October, an increase of 2.8 million over the past year.
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