Associated Press
Unemployment Rate Unexpectedly Surges
Friday December 6, 8:43 am ET
By Leigh Strope, AP Labor Writer
Unemployment Rate Unexpectedly Surges to 6.0 Percent in November, Highest Rate in Nine Years
WASHINGTON (AP) -- The nation's unemployment rate unexpectedly shot up to 6.0 percent in November, the highest level since a peak almost nine years ago when the country was struggling to emerge from the last recession.
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The report, released Friday by the Labor Department, portrayed a bleak snapshot of the U.S. economy at a time when many analysts had thought that rock bottom days for job seekers were behind them. Analysts were expecting a slight increase from the 5.7 percent posted in October.
U.S. companies also slashed 40,000 jobs in November, the most since nine months ago, when 165,000 jobs were cut. Economists had forecast modest job growth for last month.
November's jobless rate was matched back in April, and it was the highest since July 1994, when the rate topped 6.1 percent.
Friday's report surprised analysts, who thought the unemployment rate might tick up to 5.8 percent for November with stabilizing layoffs and fewer workers seeking unemployment benefits in recent weeks.
That had created optimism for the holiday shopping season -- a hope that workers were lining up at cash registers rather than at unemployment offices. Consumer spending accounts for two-thirds of all economic activity in the United States and has been the main force keeping the economy going all year.
Low mortgage rates, tax cuts, and extra cash coming from a refinancing boom have helped to support consumer spending, offsetting some negative factors, including the roller-coaster stock market, a possible war and a string of corporate scandals.
Still, economists did not expect companies to go on a hiring spree. In the face of the struggling recovery and economic uncertainties, companies are keeping their work forces lean.
