Unemployment Rate Surges to 9.8%, Economists Again Proven Wrong

Good thing Barack Obama is focused on the important issues, like attacking Fox News and trying to get the O-lympics to Chicago.

Maybe he can eventually do something about the unemployment rate, somethign he can't blame on Bush any longer and will surely cost the Democrats dearly at the polls next November. Naturally this story says the losses were worse than expected. Isn't that always the case when they're making excuses for a Democrat?

The American economy lost 263,000 jobs in September and the unemployment rate rose to 9.8 percent, the government reported on Friday, dimming the prospect of any meaningful job growth by the end of the year.

The Labor Department’s monthly snapshot of unemployment dashed hopes that the pace of job losses would continue to slow as the economy clawed its way back from a deep recession. Economists had been hoping for 175,000 monthly job losses.

In one bright spot, fewer jobs were lost in August than originally reported — with 201,000 positions gone instead of earlier figures of 216,000.

But overall, the report offered little good news for the 15.1 million unemployed people in the United States. The number of hours worked stagnated. Overtime hours slipped in many industries. And temporary help companies — typically, among the first to rebound after a recession — shed 1,700 jobs.

Indeed, while many businesses are making money again and seeing new orders trickle in, most are not ready to hire back the workers they laid off, even part-time.

To economists, that suggests that unemployment could remain at historically high levels through next year, if not longer.

“It’s a little bleak,” said Marissa Di Natale, senior economist at Moody’s Economy.com. “We’re not going to see job growth until the second half of next year. And even when it does start to grow, it’s going to be slow.”

What happened to all those "shovel-ready" projects we heard about last winter?

For Democrats, a slow recovery — and an unemployment rate at a 26-year high — could quickly become a liability,if businesses are not hiring by next year’s mid-term elections.

The Obama administration has said job losses would be even worse without the tax credits and spending projects from the $787 billion stimulus, but Republicans have pilloried the programs as ineffective.