9 Mar 2009

US unemployment rate hits 25-year high

3:30 pm on 9 March 2009

The United States unemployment rate hit 8.1% last month, the highest in 25 years, as employers cut 651,000 jobs.

Since the start of the recession in December 2007, the economy has shed 4.4 million jobs, with more than half purged in the last four months alone.

The Obama administration, which is rolling out a $US787 billion stimulus package to try to break the economy's alarming downward spiral, said February's jobs statistics were more evidence of the depth of the recession.

The success of this plan depends on stabilising the fractured financial system and collapsed housing market, which are at the centre of the economic rout.

The Labor Department said the unemployment rate in February was the highest level since December 1983.

Job losses in February were broad-based, with only government, education and health services adding jobs. In addition, the department said a combined 161,000 more jobs had been lost in January and December than was previously believed.

The department also noted a sharp rise in the number of people experiencing long spells of unemployment, with 2.9 million people having been unemployed for 27 weeks or longer in February, compared with 1.3 million in January.