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Spending Less, Working Less

Published 10/27/08 Dustin Ensinger - Print Article
E-mail - editor@economyincisis.org

The economic meltdown is taking its toll on industries across the board. From the auto industry to the financial industry jobs are being cut, further deepening the crisis.

American giants like Merck, Yahoo, General Electric, Goldman Sachs, Bank of America and Coca-Cola are just a few of the companies that have cut jobs recently to offset disappointing third quarters.

In the month of September, 2,269 companies laid-off 50 or more employees. The hardest hit sectors of the economy were the financial industry, the auto industry, the airline industry, the retail industry and construction.

Since the credit crisis hit last summer, the financial industry has shed 300,000 jobs. Goldman Sachs has cut 10 percent of its 32,594-person workforce. The airline industry has cut 36,000 jobs.

As consumers continue to rein in spending the job market is expected to worsen. When Oct. jobs losses are announced Nov. 7, they are expected to exceed 200,000. Unemployment, currently at 6.1 percent, could reach nearly 10 percent by the end of 2009, according to some analysts.

“People have grown very nervous,” said Harry Holzer, a labor economist at Georgetown University and the Urban Institute, tracing cause and effect. “They have seen a lot of their wealth wiped out and as they cut back their spending, companies are responding with layoffs, which hurts consumption even more.”

Source The New York Times:

As the financial crisis crimps demand for American goods and services, the workers who produce them are losing their jobs by the tens of thousands.

…

When October’s job losses are announced on Nov. 7, three days after the presidential election, many economists expect the number to exceed 200,000. The current unemployment rate of 6.1 percent is likely to rise, perhaps significantly.

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