US unemployment at it’s highest rate since 1983
US unemployment is at it’s highest rate for 26 years now, with the number still yet to climb. With the economical crisis which is happening globally, the US economy has seen an increase of people being laid off, a rise of 8.1%, through out all major sectors, with only last month a huge lay off figure of 700,000 Americans, made unemployed.
Since the plunge in the US market of December 2007, figures of around 4.5 million people have been made redundant. This number of unemployment has been from mainly every sector, ranging from financial services, factory, retail and constructions, every sector doesn’t seem to be able to escape the inevitability of the economical down turn.
Figures shown in the last 3 months of this year 2009, that astonishingly this has been the worst amount of job losses in this short space of time since the Second World War.
Nigel Gault, senior US economist at IHS Global Insight. said about events, “These declines are unprecedented. The last time we had three months in a row of job losses over 600,000 was in 1945.”
New president elect Barack Obama, has set up plans with the Obama administration to inject a huge stimulus package said to be in the range of $787bn. Which will also go into reduce tax and bring in new jobs for the unemployed and try unlocking the closed employment door for so many Americans.
The most badly hit sector of unemployment, is in the construction and factory sector with a combined lay off amount of 250,000 employees.
With the rate of so many people being let go, top economists say that this will have a damaging knock on effect. With many people being unable to pay back mortgages and loans, which will further have a mightier effect on banks and lenders, driving the US economy into a deepening recession.
Olivier Garret, chief executive of the investment advisory firm Casey Research, said the knock-on effect could be highly damaging: “You will have more defaults on mortgages, more defaults on personal loans. Credit card companies are going to see an increase in their default rate and you’re going to see lower consumption as people adjust to new realities.”
