Job Losses Reach Five Year High

Washington, DC, Oct. 3, 2008--The economy lost more jobs last month than in any month in more than five years, led by a sharp drop in service sector jobs and continuing losses in the construction, manufacturing and retail sectors, the Labor Department said today.

The economy lost 159,000 jobs in September, far more than the 100,000 that economists were expecting. September's decline is the largest seen since March 2003, when the economy lost 212,000 jobs.

The economy has now lost 760,000 jobs since January. Economists have said the economy needs to create about 100,000 jobs each month to keep up with new workers, but with September's numbers, the economy has now averaged a monthly loss of about 43,000 jobs over the last 12 months.

Labor upwardly revised July and August payrolls by 4,000, for a cumulative two-month total loss of 140,000 jobs.

The unemployment rate, taken from a separate survey of households, remained unchanged in September at 6.1 percent, as expected. That's the highest unemployment level seen since September 2003.

The official unemployment rate only includes workers who are actively seeking a job. The labor force participation rate, which includes the number of working-aged people with jobs, fell slightly to 66.0 percent.

Services jobs are usually a major factor in job gains, but 82,000 jobs were lost in this sector in September, the biggest monthly loss seen since March 2003. Service-sector jobs have declined for the last four months.

Construction jobs fell once again, by 35,000, and manufacturing jobs lost 51,000. Manufacturing jobs have not increased in 27 months. Retail jobs dropped by 40,000, and September was the tenth straight month of job losses in this sector.

Government and education/health services were the only sectors to gain jobs in September. Government added 9,000 jobs, and education/health services gained 25,000.