AS THE FIRST African-American president prepares to start his term, the job situation continues to deteriorate. The nation has lost jobs in each of first 10 months of this year, and statements from automakers suggest we’ll see more layoffs before President-elect Obama is sworn in.
The Department of Labor reports that employers cut 240,000 jobs in October and 284,000 in September, raising this year's total loss to 1.2 million jobs. At the end of October, the unemployment rate stood at 6.5 percent, the highest since 1994. Nearly 10.1 million workers were unemployed in October, 2.8 million more than a year ago.
Analysts predict heavy job losses will continue through at least the first three months of 2009, owing to a worldwide economic downturn that many economists say will be far worse than the recessions of 2001 and 1990-1991. Some say the unemployment rate might rise above eight percent, the highest since 1983.
Adding to the discouraging employment outlook, General Motors Corp. and Ford Motor Co. both announced that losses in the third quarter of 2008 force them to continue reducing their salaried workforces. Both companies plan to cut white collar personnel costs by 10 percent through job cuts and further benefit reductions in addition to reductions begun earlier this year.
The Big Three automakers, GM, Ford, and Chrysler, have asked Congress for financial aid to weather the crisis. Their request includes $25 billion in loans so they can meet their health care obligations to more than 780,000 retirees and dependents.
President-elect Obama has called for congressional action on a stimulus package to restore growth and prosperity, but it is unlikely Congress will take any such action before Obama officially become president January 20, unless President Bush backs the plan.
