Jobless rate soars to 6.1%
Unemployment surges to 5-year high as employers cut workers for eighth
straight month, bringing '08 job losses to 605,000.


NEW YORK (CNNMoney.com) -- The unemployment rate soared to a nearly
five-year high in August, topping 6%, as employers trimmed jobs for the
eighth straight month, according to the latest government reading Friday
that came in weaker than forecasts.

The big surprise in the report was that the unemployment rate rose to
6.1%, the highest level since September 2003. That's up from the 5.7%
rate in July and 4.7% a year ago. Economists surveyed by Briefing.com
had forecast the rate would remain unchanged from the July reading.

There was a net loss of 84,000 jobs in August, according to the Labor
Department, compared to a revised reading of a 60,000 job loss in July.
Economists surveyed by Briefing.com had forecast a loss of 75,000 jobs.

With the August report, the U.S. economy has now lost 605,000 jobs so
far this year.

Manufacturing lost 61,000 jobs, while construction employment fell by
8,000. But the job losses were widespread beyond those two troubled sectors.

Retailers trimmed 20,000 jobs despite the back-to-school shopping season
that is second only to the holiday period for many stores. Business and
professional services, a broad category that includes industries such as
accountants, consultants and legal services, lost 53,000 workers.
Leisure and hospitality cut 4,000 jobs.

The few sectors showing gains were government as well as education and
health services, which gained 72,000 between them to temper the losses
elsewhere.

But while economists generally study the payroll numbers most closely in
this report, it's the unemployment rate that registers with most
Americans when they think about the labor market.

The jump is likely to be a new blow to consumer confidence, which had
just started to show gains from earlier lows due to declining gasoline
prices. And if consumer confidence starts to fall again, it could put a
brake on spending which in turn would be a new drag on the economy.

The unemployment rate doesn't even tell the whole picture about how
difficult the job market has become. It only counts those who looked for
work during the month, not unemployed people who want jobs but who have
become discouraged from looking for work. And it also doesn't count
those who want full-time jobs but can only find part-time position.

The so-called underemployment rate, which includes those two other
groups, rose to 10.7%, the highest reading since 1994.