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March 8, 2008
WASHINGTON - Dangerous cracks are appearing in the nation's job market.
Employers slashed jobs by the largest amount in five years - and hundreds of thousands of people dropped out of the labor force - an ominous sign that the country is falling toward a recession or has already toppled into one.
For the second straight month, employers got rid of jobs nationwide. In February, they sliced payrolls by 63,000, even deeper than the 22,000 positions cut in January, the Labor Department reported Friday.
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"It sounds like the recession bell is ringing for the U.S. economy, although it is still faint," said Stuart Hoffman, chief economist at PNC Financial Services Group.
The unemployment rate dipped slightly from 4.9 percent to 4.8 percent, as 450,000 people left the labor force.
Economists thought many likely gave up looking.
The shower of pink slips was widespread. Factories, real-estate firms, retailers, hotels, accounting firms and computer designers were among those shedding jobs. All those cuts swamped job gains at health care sites, restaurants, legal services and the government.
"Losing a job is painful, and I know Americans are concerned about our economy; so am I," President Bush said. "It's clear our economy has slowed."
To relieve persistent credit problems, the Federal Reserve announced it will increase the amount of loans it plans to make available to banks this month to $100 billion. The Fed also said it will make $100 billion available to a range of financial players through separate transactions.
Workers with jobs saw modest wage gains. Average hourly earnings for jobholders rose to $17.80 in February, a 0.3 percent increase from the previous month. Over the last 12 months, wages were up 3.7 percent.
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