The US unemployment rate has hit double digits for the first time since 1983 — and is likely to go higher. The 10.2 per cent jobless rate for October shows how weak the economy remains even though it is growing. Rising unemployment also could threaten the recovery if it saps consumers’ confidence and makes them more cautious about spending as the holiday season approaches.

Nearly 16 million people can’t find jobs even though the worst recession since the Great Depression has apparently ended. The unemployed rate jumped to 10.2 per cent, the highest since April 1983, from 9.8 per cent in September, the Labor Department said on Friday. The economy shed a net total of 190,000 jobs, more than economists had expected.

The number of unemployed hit 15.7 million, up from 15.1 million. The job losses occurred across most industries, from manufacturing and construction to retail and financial. The job-loss total is based on a survey of businesses, separate from a survey of households that produces the unemployment rate.

Economists say the unemployment rate could reach 10.5 per cent next year because employers remain reluctant to hire. US president Barack Obama called the new jobs report another illustration of why much more work is needed to spur business creation and consumer spending. Noting legislation he’s signing to provide additional unemployment benefits for laid-off workers, Obama said, “I will not rest until all Americans who want work can find work.”

Still, counting those who have settled for part-time jobs or stopped looking for work, the unemployment rate would be 17.5 per cent, the highest on records dating from 1994. “It’s not a good report,” said Dan Greenhaus, chief economic strategist for New York-based investment firm Miller Tabak & Co. “What we’re seeing is a validation of the idea that a jobless recovery is perfectly on track.”

... contd.