America's civilian unemployment rate hit a 3 1/2-year high of 6.2 percent in January as the worst stretch of layoffs since 1982 wore on, forcing businesses to cut 230,000 jobs, the government said Friday.
So bleak were the numbers that the Federal Reserve Board moved within an hour of their release to cut the discount rate for the second time in six weeks. The cut, from 6.5 percent to 6.0 percent, spurred several major banks to lower their prime lending rate, making it cheaper for businesses and consumers to borrow.On Capitol Hill, House Majority Leader Richard Gephardt, D-Mo., cited the dreary jobs report in chiding President Bush, who, in his State of the Union address Tuesday, called the recession a ``temporary interruption' in business expansion.
``For millions of Americans, this means more than a 'temporary interruption' in their wages, their rents, their mortgage payments and their health care bills. It means an enormous disruption in their lives,' he said.
Private analysts said the new unemployment calculation may destroy hopes for a short, mild recession.
Last month's rise in the jobless rate, up from December's 6.1 percent, means that unemployment since June has shot up at its fastest pace since the last recession. Seven months ago, unemployment was at a relatively low 5.3 percent.
Since then, 1.2 million Americans have joined the ranks of the unemployed and the nation's businesses have cut more than 1 million jobs, said the Labor Department report, based on a survey of payrolls.
In January, payrolls tumbled by 232,000 jobs. Manufacturing and construction were particularly hard hit.
That huge loss followed a December decline of 150,000 jobs, a revised number about twice as bad as that first reported by the government.
In a separate survey of households, the government said the number of Americans who lost their last jobs, rather than voluntarily leaving, rose by 270,000 in January to 4.1 million.
Many of those job losers didn't show up as additions to the unemployment rolls - the net total of newly jobless was 115,000 - because thousands of them probably didn't try to find another job, analysts said. The government counts as unemployed only those actively seeking work.
The number of newly unemployed can differ from the payroll loss total because the numbers come from different surveys of households and business establishments.