In a hammer blow to hopes for the U.S. jobs recovery, the unemployment rate surged to 9.8% in November, the Labor Department reported on Dec. 3.
The economy created many fewer jobs than expected and the unemployment rate rose dramatically from the 9.6% seen in October, to its highest level since April.
A measly 39,000 jobs were created, well short of the 130,000 predicted by economists and well beneath the levels needed to make a dent in unemployment rates.
Job losses in the retail and manufacturing sector led the decline.
More than 15 million jobseekers were unemployed in November. With nearly 40% of the jobless unemployed for more than six months, fears are growing that high jobless rates may be more than a temporary result of a brutal recession.
"Todays jobs report marks the 19th consecutive month in which unemployment has exceeded nine percent, an unacceptable result," said Eric Cantor, a leading Republican lawmaker in the House of Representatives. He urged Congress to extend Bush-era tax cuts that critics argue the deficit-ridden country can ill afford, but supporters argue will help spur the recovery.
"Congress should reassure job creators and investors by taking the impending tax hikes off the table."
With Congress frozen by partisan politics and gripped by fears about U.S. debt levels, Obama has hoped to lower the unemployment rate by clinging on to what government stimulus still exists.
Ahead of the report, the White House warned that Congress's refusal to extend unemployment benefits would damage the economy as two million Americans will see their incomes slashed. "Extending this support to those hardest hit by this crisis is not only the right thing to do, it's the right economic policy," said top Obama adviser Austan Goolsbee.
"Letting millions more Americans fall into hardship will hurt our economy at this critical point in our recovery and immediately undermine consumer spending."
The Labor Department raised its estimates of job creation in October from 151,000 to 172,000, a hike that was of little succor to markets.
"Despite some upward revisions, the headline number was wildly off, and wildly disappointing," said Jason Schenker, President of Prestige Economics.
Copyright Agence France-Presse, 2010