More workers in the United States lost jobs last year than in any year since World War II, with employers axing 2.6 million posts and 524,000 in December alone.
The US jobless rate rose to 7.2% in December, the highest in 16 years, the BBC reports.
Companies are cutting jobs as consumers reduce spending, amid fears the world's biggest economy will be in recession for a long time.
US President-elect Barack Obama said that the situation is dire and action is urgently needed to help the economy.
Mr Obama said he was making good progress in talks with Congress on a new stimulus package - estimated to cost $US800 billion.
The annual jobless total was higher than expected, partly because jobless figures in November and October were revised upwards.
November's job losses were revised to 584,000 from 533,000 while October's losses were revised to 423,000 from 320,000.
More than half of the job losses last year were in the last four months of the year.
Analysts had forecast that 550,000 jobs would go in December.
Most December job losses were in the service sector, which shed 273,000 jobs. Manufacturing jobs fell by 149,000 in December, while employment in construction fell by 101,000, with retailers cutting staff by 67,000.
Some of those lucky enough not to lose their jobs, had their hours reduced. The number of aggregate hours worked in December fell 0.2 hours to 33.3 hours, the lowest level since records began in 1964.
