It's an Employers' Market: Job Losses Grow

By Dennis Romero of Entrepreneur.com



American pink slips continue to mount this winter, with the national unemployment rate reaching a postwar high of 7.2% for the month of December, according to the U.S. Department of Labor. Job losses reached 2.6 million in 2008 -- the most since 1945 -- and some experts predicted that 2009 would bring the worst unemployment rate since the Great Depression of the 1930s.

In New York, North Carolina and Ohio this week, unemployment claims hit a snag when Web sites crashed and phone lines faltered under a barrage of requests for relief. December and January losses are fed by some of the nation's biggest corporations, including AT&T (T Quote), DuPont (DD Quote), Walgreen (WAG Quote) and Alcoa (AA Quote).

Sectors hard hit in the labor department's just-released end-of-2008 report include construction, which has dropped 899,000 total jobs since 2006; factory jobs, down 791,000 for 2008; temp work, down 490,000 positions last year; and retail, which saw 522,000 fewer gigs in '08. The few employment bright spots included education, government and health care, the latter of which was up 32,000 positions in December alone.

"The jobs market is still in a freefall," said Global Insight chief economist Nariman Behravesh, in a statement. His firm predicts that the unemployment rate will continue to climb to as high as 9.5% in 2009 if a federal stimulus package doesn't stem the flow of job losses.

Some experts suggest that the percentage of unemployed workers is actually in the double digits when the marginally employed and perpetually unemployed are counted. "We think it's going to be a nasty employment situation in 2009," says Kevin Feltes, associate director of the Jerome Levy Forecasting Center.