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Unemployment Surges To Record High

By CityTownInfo.com Staff

March 9, 2009

A new wave of layoffs has pushed unemployment to 8.1 percent, its highest level in more than 25 years.

With the notable exception of the healthcare field, which added 30,000 jobs, most industries keenly felt the economic downturn: United Press International reports that according to payroll company Automatic Data Processing Inc., the construction industry shed 114,000 jobs in February, while service jobs also declined by 395,000 and manufacturing jobs decreased by 219,000.

In addition, the Associated Press reports that during February among retailers, a total of 22,300 jobs were cut from motor vehicle and parts dealers as well as automobile dealers. Department stores lost 9,300 jobs, sporting goods, hobby, book and music stores lost 8,600 jobs, and furniture and home furnishings stores shed 8,200 jobs.

The Labor Department released the grim statistics last Friday, and The New York Times reacted to the news by reporting that that in manufacturing, financial services and retail industries, the layoffs may be indicating a complete abandoning of whole areas of business.

According to John E. Silvia, chief economist at Wachovia in Charlotte, North Carolina, many of these jobs will not be coming back. "A lot of production either isn't going to happen at all, or it's going to happen somewhere other than the United States," he told The Times. "There are going to be fewer stores, fewer factories, fewer financial services operations. Firms are making strategic decisions that they don't want to be in their businesses."

The Times noted that economists are now concluding that rather than providing unemployment checks, the government instead needs to focus on retraining workers for other careers.

"We have to seriously look at fundamentally rebuilding the economy," said Andrew Stettner, deputy director of the National Employment Law Project in New York. "You've got to use this moment to retrain for jobs."

Robert E. Hall, an economist at Stanford University's Hoover Institution, agreed. "The decimation of employment in legacy American brands such as General Motors is a trend that's likely to continue," he told The Times. "We have to stimulate the economy to create jobs in other areas."

But The Seattle Times counters that merely calling for retraining is unrealistic, since nobody can accurately predict where the jobs will be. "The recession does mean, as The New York Times says, that the American economy is to be renewed," says The Seattle Times' editorial. "Government needs to accommodate that renewal. It cannot do it by massive increases in job training, because for the most part, it does not know what jobs to train for."

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