U.S. Economy: Companies Cut Payrolls at Faster Pace

[Omaha Steve]

http://www.bloomberg.com/apps/news?pid=20601068&sid=arG1gnJh3mng&refer=home

By Bob Willis and Courtney Schlisserman

Jan. 7 (Bloomberg) -- Reports issued two days before the release of U.S. jobless data showed private employers cut payrolls at a faster pace in December, threatening to send the unemployment rate to levels unseen in a quarter century.

“The level of unemployment is going to be higher” and may exceed 10 percent, Martin Feldstein, the former National Bureau of Economic Research president and Harvard University professor said in a Bloomberg Television interview. “It’s really bad and it needs a fix,” he said before a hearing on the fiscal-stimulus plan with House lawmakers in Washington.

Companies cut an estimated 693,000 jobs in December, the most since ADP Employer Services began its gauge based on payroll data in 2001. Chicago-based Challenger, Gray & Christmas Inc. said firings announced by U.S. employers rose 275 percent last month from December 2007, to 166,348.

Stocks fell the most in more than a month after reports from Alcoa Inc. and Intel Corp. spurred concern the outlook for profits is worsening. Feldstein, a White House economic aide in the Reagan administration, endorsed the $775 billion fiscal stimulus planned by the incoming administration of Barack Obama, which aims to save or create 3 million jobs.

‘Facing a Crisis’

“We are facing a crisis in our economy, one that requires immediate and decisive action to spur the creation of new jobs,” Obama said at a press conference in Washington. House Speaker Nancy Pelosi said at the forum attended by Feldstein that “a failure to act quickly can only lead to more job losses,” saying Congress should act on the recovery package by mid-February.

FULL story at link.

[ananda]

1. I see a lot of military fodder down the line..

.. in the near future.