Mar 6

Written by: Russ Henke
3/6/2009 6:48 AM 

We all found out on February 27, 2009 that the US economy at the end of last year actually contracted at a far faster rate than initially estimated, according to a US Bureau of Economic Analysis report. The decline in the country's gross domestic product in Q4 2008 was the worst since the 1982 recession. Output fell 6.2% at an annualized rate in the fourth quarter of 2008, revised downward from a previous estimate of a 3.8% decline.

Today, more bad news was released by the US Labor Department. The nation's unemployment rate rose to 8.1% in February 2009, the highest since 1983, as employers chopped another 651,000 jobs.

Both figures were (as usual) worse than analysts expected. And as predicted in this blog space on February 6, 2009, revised figures released today show even deeper payroll reductions in the prior two months: the economy lost 681,000 jobs in December 2008 and another 655,000 in January 2009. Since the recession began in December 2007, the economy has lost an incredible 4.4 million jobs.

If it were not for the strong likelihood that the February figure of 651,000 jobs lost might still be revised upward, could it be argued that 651,000 begins a trend downward from 681,000 and then 655,000 in the prior two months? Not a chance!