The U.S. Department of Labor released December’s unemployment figures and the unemployment rate shot up to 7.2%.  This is an increase from 6.8% from November.  The number of job losses was 524,000.  These figures were roughly matching the consensus estimate for this time.

The total number of unemployed rose to 11.1 million.  The report stated that since the recognized start of the recession in December 2007, the number of unemployed persons has grown by 3.6 million, and the unemployment rate has risen by 2.3 percentage points.

Based on the government figures, the civilian labor force stood at 154,447,000, the number employed was 143,338,000 and the total unemployed was 11,108,000. These figures lead to a labor force participation rate of 65.7 percent which was little changed in December for those who may put any value in those statistics.

The total weekly hours worked was 33.3 hours per week.  This is down from 33.5 hours in November and down from the third quarter average of 33.7 hours per week.  The drop in weekly hours can be seen as an early indicator that more jobs will be losses since many firms will cut back hours before ultimately cutting back jobs.  
  
A significant and so far overlooked statistic was the previous month revisions.  The change for November was revised from down 533,000 to down 584,000 and the change in total nonfarm employment for October was revised from down 320,000 to job losses of 423,000.

Other highlights from the employment report:

Manufacturing employment fell by 149,000 in December, the largest over-the-month decline since August 2001.  Factory job losses totaled 791,000 in 2008, with nearly half of the decrease occurring in the fourth quarter.

The temporary help industry lost 81,000 jobs in December.  Another sign of more job losses to come.

Employment in retail trade declined by 67,000 in December.  In December, employment decreased in automobile dealerships by 22,000.

Employment in transportation and warehousing declined by 24,000 in December.

Employment in construction continued to declined by 101,000 in December.

This is going to put more pressure on the Obama administration, the Fed and the Treasury to keep priming the money pumps and boost the stimulus package. Expect interest rates to remain low for the foreseeable future.  Downward pressure on bank rates including money market rates and CD rates should decline slightly further.

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