Knight Ridder News
WASHINGTON — The unemployment rate rose to 6 percent last month as the U.S. economy lost jobs for the third month in a row, the Labor Department reported Friday.
Manufacturing and tourism were hit especially hard. Overall, the number of jobs in America shrank by 48,000, on top of declines of 124,000 in March and 353,000 in February.
The job losses partly reflected the war clouds that hung over the economy for much of last month. Analysts expect the economy to bounce back in the second half of the year. In one promising sign, factory orders rose 2.2 percent in March, the Commerce Department reported Friday.
But even if the anticipated second-half pickup materializes, the job market probably will remain weak, analysts said. The so-called "jobless recovery" may last even longer than a similar tepid recovery after the 1990-91 recession.
Firms generally are cautious about adding workers after an economic downturn. This time, hiring may rebound even more slowly, because new technologies and other advances have made American companies more productive. That enables them to increase production with the same number of workers.
"Employment should recover in the months ahead, but the pace of gains is likely to remain modest," said John Silvia, chief economist at Wachovia Securities in Charlotte, N.C. "The economy continues to grow through productivity and not job gains."
Analysts forecast that the unemployment rate, up from 5.8 percent in March, will continue rising to the 6.2 percent to 6.3 percent range.
The unemployment rate for blacks rose to 10.9 percent in April. The Hispanic rate held steady at 7.5 percent, and the white unemployment rate was virtually unchanged at 5.2 percent. The Labor Department doesn't provide a figure for Asians.
The average length of unemployment rose to 20.6 weeks, from 18.9 weeks in March. More than a fifth of the unemployed have been out of work six months or longer.
The deterioration in the job market probably will give a small boost to President Bush's push for a tax cut, which he says would help the economy. Still, Congress remains on track to pass a smaller tax cut than Bush proposed, amid lawmakers' concern about a growing federal budget deficit.
With a re-election campaign coming next year, the president wants to do all he can to ensure a healthy job market by then. He argued for a large tax cut Friday in a speech at a defense plant in Santa Clara, Calif.
"I urge the United States Congress to look at the unemployment numbers that came out today and pass a tax relief plan that will matter, a tax relief plan robust enough so that the people of this country who are looking for work can find a job," Bush said at United Defense, which makes the armored Bradley Fighting Vehicles that were used extensively in the Iraq war.
Manufacturing jobs fell by 95,000 in April, about double the loss in each of the previous two months. In the travel sector, air transport lost 18,000 jobs and hotel employment fell by 20,000.
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