NEWS
11/4/2009 10:45:00 AM
Employment losses smallest in more than a year
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Companies in the United States cut an estimated 203,000 jobs in October, according to a private report based on payroll data, Bloomberg reported.
The drop was the smallest in more than a year and followed a revised 227,000 decline in the prior month, based on data from ADP Employer Services released today. The figures had been expected to show a decline of 198,000 jobs, according to the median estimate of 34 economists in a Bloomberg survey.
The report signals that unemployment will keep climbing even after the economy begins to expand, which is one reason Federal Reserve policy-makers may pledge to keep interest rates low for a long time after their meeting today. ADP has overstated the Labor Department's initial estimate of payroll losses by 103,000 per month on average in the five months to September.
"The losses, while smaller than in previous months, were nonetheless widespread," Joel Prakken, chairman of Macroeconomic Advisers LLC, said in a conference call with reporters. "I'm still expecting to see payroll employment decline probably through the end of the year, not turn up until January or February."
ADP includes only private employment and doesn't take into account hiring by government agencies. Macroeconomic Advisers in St. Louis produces the report jointly with ADP.
The report comes two days before a Labor Department release that is forecast to show the unemployment rate rose to 9.9 percent in October, the highest since 1983, while employers cut 175,000 jobs. The economy already has lost 7.2 million jobs since the recession began in December 2007, the most of any economic slump since the Great Depression.
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