U.S. Unemployment Rate Climbs To 9.4%

I'm sure that really makes those 345,000 (net) folks feel wonderful. Yes, that in fact is a net number; remember that just yesterday we received Labor Department statistics showing 605,000 laid off in the last week.

While some say the recession is slowing, the increase in the nation's unemployment rate from 8.9% in April to 9.4% in May is greater than analysts had expected. Economists had estimated a 9.2% rate for last month. It also shows the continuing difficulties that America's 14.5 million unemployed are having in finding new jobs.

Let us not forget the true unemployment numbers, which include those who have given up looking for new jobs, used up their jobless benefits, or have settled for part-time work. In that case, the unemployment rate would have been 16.4% in May, the highest on record dating to 1994.

In terms of sectors, in May construction companies cut 59,000 jobs, down from 108,000 in April. Meanwhile, factories cut 156,000, up from 154,000 in the April. Retailers cut 17,500 positions, down from 36,500 in April. Financial firms cut 30,000, down from 45,000 in April. Finally, even government jobs were affected: in April 92,000 government jobs were added as 2010 census jobs were created, but in April employment dropped by 7,000.

Meanwhile, the education, health care, and leisure and hospitality sectors were adding jobs in May.

Many economists believe the jobless rate will hit 10% by the end of this year,with some estimating that it could rise as high as 10.7 percent by the second quarter of next year before beginning a slow descent. The post-World War II high: 10.8% percent at the end of 1982. It should be noted that there were, of course, significantly less people in the country then.