WASHINGTON U.S. businesses eliminated workers in March for the first time in seven months, and the unemployment rate rose to 4.3%, the highest in more than a year and a half.
Payrolls unexpectedly fell by 86,000 during the month, after a revised gain of 140,000 jobs in February, the Labor Department said. The decline was the largest since November 1991, when the economy was emerging from the last recession.
Jobs in services declined more than in any other month since November 1991, and factory employment fell for an eighth straight month. Companies such as Citigroup Inc. and Delphi Automotive Systems Corp. are eliminating jobs to cut costs as the economy slows, profits slump, and the stock market weakens.
With this degree of job decline, you run the risk that there isnt enough income to support increased consumer spending, which accounts for about two-thirds of economic growth, said David Orr, chief economist at First Union Corp. in Charlotte.
Unemployment rose from 4.2% in February and was the highest since July 1999. Analysts expected an unemployment rate of 4.3% in March and an increase of 60,000 jobs after Februarys previously reported gain of 135,000.News