Jobless rate rises to 8.5 percent

Layoffs at local law firms, hospitals, factories, and call centers contributed to job losses that pushed the nation's unemployment rate to 8.5 percent in March, the highest since late 1983.

U.S. employers cut 663,000 jobs, bringing to 5.1 million the total number of jobs lost since the recession began in December 2007, the Labor Department reported yesterday.

"The economy is shifting to permanently lower levels of production and employment," University of Maryland professor Peter Morici said. "Lacking confidence that the demand for what Americans make and sell will recover significantly anytime soon, businesses are girding for the long siege - slashing employment . . . and hunkering down," he said.

The number of unemployed people climbed to 13.2 million in March, and the workweek shrank to 33.2 hours, a record low, according to federal data.

The numbers, as bad as they are, mask the real toll. Add in the 9 million taking part-time jobs because they could not get full-time work, and those who want jobs but are too discouraged to look, and the jobless rate jumps to 15.6 percent, the department said. Nearly a fourth have been unemployed longer than 27 weeks. The average duration is up to 20 weeks, from 16 weeks a year ago.

The statistics worry such college graduates as Robel Andemicael, 23, of Carneys Point, N.J., who attended a career fair at Rutgers University in Camden on Tuesday.

He graduated in January with an accounting degree. "I thought there would always be a need for [accountants]," he said, plaintively. Now he's back living with his parents.

Job losses were widespread last month. Construction companies cut 126,000 jobs. Factories axed 161,000. Retailers got rid of nearly 50,000. Professional and business services eliminated 133,000. Even governments cut jobs - 5,000 of them, though government hiring rose in the first quarter.

Companies would have to create at least 120,000 jobs a month just to absorb new entrants into the labor force, economists agree.

Yesterday, the Labor Department reported that in February, employment fell by 67,400 year-over-year in the Philadelphia area stretching south to Cecil County, Md., and north to Burlington, Bucks and Montgomery Counties.

That includes 24,200 jobs in the four Pennsylvania suburban counties, 9,400 in the city, 20,800 in the three nearby Jersey counties, and 13,000 jobs in the rest of the area, including Wilmington. The unemployment rate in the region was 8 percent in February. Local jobless figures usually lag by about a month.

Economists expect monthly job losses to continue for most - if not all - of this year.

However, they are hoping that cuts in the current quarter won't be as deep as the roughly 685,000 average monthly job losses in the January-March period. They say the job market might not get back to normal - meaning a 5 percent unemployment rate - until 2013.

"There's going to be quite a long haul before you see the jobless rate head down," said Bill Cheney, chief economist at John Hancock Financial Services.

In the best-case scenario, losses in the present quarter would be about half that pace, some economists said.

It can't come soon enough for Ibiyemi Amoo, a recent Rutgers graduate distributing her resume at the campus job fair. "I'm still looking," she said.

Maybe Amoo will get lucky, but it's a tough road. Employers expect to hire 22 percent fewer grads from the Class of 2009 than they hired from last year's class, says the National Association of Colleges and Employers, the Bethlehem, Pa., group that tracks college hiring.

At the Camden job fair, the number of job-seekers doubled to 300 from last year, while the number of companies declined from 40 to 27. "We had a lot more students than usual because of the job market," said James Marino, who runs the campus career center.

On Thursday, Philadelphia University held its annual job fair for students in fashion merchandising, architecture, textile design, and graphic art. The number of students stayed the same, but the number of companies dropped from about 80 to 63. Of the 63, only about 40 were actively recruiting for jobs or internships, said Trish Shaffer, director of the university's career service center.

"The students are anxious," she said.

Abdul Shariff, a Rutgers senior majoring in finance and economics, refuses to be discouraged and showed up at the Camden job fair to encourage his classmates.

"You are still in the better part of everything," said Shariff of Voorhees. "You have a degree. You are in the best economy in the world. It's going to pay off. Right now, we're just caught in a bad time."

Still, three job offers that Shariff had received were eventually rescinded, including one from Merrill Lynch, he said. One company even mailed pre-employment documents, before calling to delay and then cancel the offer.

Shariff finally landed a job selling financial services, starting in June. "I applied for jobs like it was my job over the summer," he said. "I didn't want to be an unemployed college graduate."