Posted on 07 Aug 2009
According to a government report released today, the U.S. economy lost 247,000 jobs in July, and in a reversal, the unemployment rate fell slightly, to 9.4 percent.
Although businesses are expected to keep cutting jobs through the rest of the year, the Labor Department’s latest figures offered some faint signs that the sinking job market was approaching bottom.
The length of the workweek increased, albeit slightly, for the first time since August, a sign that businesses were not scaling back hours to cut their payroll costs. The government said fewer jobs were lost this spring than it had initially estimated, revising June’s lob losses to 443,000 from 467,000.
“The basic message is that the rate of job cuts is diminishing, and that’s good news,” said Nariman Behravesh, chief economist at IHS Global Insight. “Still, you’re seeing job cuts everywhere except education, health care, government. I don’t think we’re at bottom yet in employment.”
Still, economists cautioned that the unemployment rate had only declined because 400,000 people gave up their search for work and left the labor force. The White House and economic forecasters still expect unemployment to reach 10 percent or more before it begins to fall. The monthly decline in payroll positions was the smallest since August.