Jobless Rate’s Rise Viewed as Bad News : 5.3% Unemployed; Report Fires Fears of Ailing Economy
The nation’s unemployment rate edged up one-tenth of a percentage point to 5.3% in September as manufacturing payrolls shrank by more than 100,000 jobs, the government said today.
The unemployment rate was up from 5.2% in both July and August, the Labor Department said in the first comprehensive look at the economy last month.
The report was weaker than many analysts had expected even though payroll declines at factories were offset by gains from teachers returning to their classrooms and telephone workers ending a strike.
‘Heading for a Tailspin’
“This report is the first in quite a while that suggests the economy could be heading for a tailspin,” said economist Allen Sinai of the Boston Co. “The report was quite soft . . . with meager employment gains. Where there were big gains . . . they are explained away by special factors.”
“The Federal Reserve Board has put more than 100,000 Americans out of work since March,” charged economist Richard Rahn of the U.S. Chamber of Commerce. “The September rise in unemployment is the direct result of the Fed-induced economic slowdown.”
The unemployment rate for adult men jumped to 4.8% last month from 4.4% in August, while the rate for women fell to 4.5% from 4.7% a month earlier.
The jobless rate is derived from a survey of American households. A separate survey of employers showed that the economy added 209,000 non-farm payroll jobs in September, bringing the total to a seasonally adjusted 109.1 million. August job growth was only 88,000, revised downward from a previous estimate of 110,000.
September growth was artificially bolstered by the return of 75,000 striking telephone workers. In the household survey, strikers are counted as employed, so their return did not affect the unemployment rate.
The department said more industries lost than gained jobs in September. Goods-producing industries, representing about one-fourth of the economy, were particularly hard hit, losing 108,000 jobs.
Loss in Manufacturing
Most of the loss was to manufacturing payrolls, which have been declining since the spring and lost 103,000 workers in September--33,000 of them in the auto industry. Thirty of 31 manufacturing industries showed declines or were unchanged.
Construction payrolls were unchanged last month while mining, which includes oil drilling, lost 5,000 jobs.
Service industries added 317,000 jobs, bolstered by the returning telephone workers and by a gain of 95,000 government jobs, most of those in local government, the likely result of the start of a new school year.
