U.S. job loss worst since 1974

NEW YORK — Employers slashed another 598,000 jobs off of U.S. payrolls in January, taking the unemployment rate up to 7.6%, according to the latest government reading on the nation’s battered labor market.

The latest job loss is the worst since December 1974, and brings job losses to 1.8 million in just the last three months, or half of the 3.6 million jobs that have been lost since the beginning of 2008.

January’s job loss was also worse than the forecast of a loss of 540,000 jobs from economists surveyed by Briefing.com

The rise in the unemployment rate also was worse than the 7.5% rate economists expected. The unemployment rate is now at its highest level since September, 1992.

As bad as the unemployment rate was, it only tells part of the story for people struggling to find jobs. Friday’s report also showed that 2.6 million people have now been out of work for more than six months, the most long-term unemployed since 1983.

And that number only counts those still looking for work. The so-called underemployment rate, which includes those who have stopped looking for work and people working only part-time that want full-time positions, climbed to 13.9% from 13.5% in December. That is the highest rate for this measure since the Labor Department first started tracking it in 1994.January was a brutal month for layoffs, as major companies ranging from Microsoft (MSFT, Fortune 500), Boeing (BA, Fortune 500) and Caterpillar (CAT, Fortune 500) to Home Depot (HD, Fortune 500) and Starbucks (SBUX, Fortune 500) all announced substantial job cuts.

The job losses in January were widespread, with the manufacturing sector shedding 207,000 jobs, the construction industry cutting 111,000 jobs and business and professional services companies losing 121,000 jobs.

Retailers also cut 45,000 workers, while the leisure and hospitality sector lost 28,000. Among the only sectors posting narrow gains in jobs were education, health services, and the government.

The jobs report comes as the Senate debates the Obama administration's proposal for a nearly $900 billion economic stimulus bill. During a debate late into the night Thursday Republicans and some Democrats questioned the bill's mix of measures and its size. To top of page