According to a new article on CNN money, the unemployment rate increased from 5% to 5.5% in May. This represents the highest increase since 1986, and another sign of the looming economic recession. To read the full article, click here, or enjoy the excerpt below.
"A spike in the unemployment rate - the biggest in more than two decades - raised new concerns Friday that a weak labor outlook, high oil prices and continuing woes in the housing and credit markets are leading the U.S. economy into a painful recession.
The government said Friday that the unemployment rate soared to 5.5% in May from 5% in April - much higher than economists had forecast.
The surge marked the biggest one-month jump in unemployment since February 1986, and the 5.5% rate is the highest level seen since October 2004. Unemployment is now a full percentage point higher than it was a year ago.
‘You're not going to have a lot of people arguing "no recession" with this data,’ said Lakshman Achuthan, managing director of the Economic Cycle Research Institute. The prolonged job loss and jump in unemployment are better indicators that the economy is in a downturn than is the traditional thumbnail rule of two quarters of falling gross domestic product, he said.
The jobs report came on the same day that oil prices soared to $134 as the dollar lost value against the euro and the yen. It also comes the day after the Mortgage Bankers Association reported that homes in foreclosure crossed the 1 million mark during the first quarter, a record high."
