2 million jobs lost so far in '09
Unemployment rate spikes to 8.5%, a 25-year high, as 663,000 jobs lost in March. 5.1 million jobs have now been lost since the beginning of 2008.
NEW YORK (CNNMoney.com) -- Job losses continued to mount in March and unemployment hit a 25-year high, according to the government's latest reading on the battered labor market Friday.
Employers trimmed 663,000 jobs from their payrolls last month, roughly in line with forecasts of a loss of 658,000 jobs, according to economists surveyed by Briefing.com.
For the first three months of the year, 2 million jobs have been lost, and 5.1 million jobs have been lost since the start of 2008.
To put the three-month loss in context, if no more jobs are lost over the next nine months, 2009 would still be the fourth worst year for job losses since the government started tracking the number of workers in 1939.
March's monthly loss is up slightly from the loss of 651,000 jobs in February, although it's less than the number of jobs lost in January. That figure was revised up to a loss of 741,000 jobs -- which now stands as the biggest monthly drop in 59 years.
More big job losses likely lie ahead, said Tig Gilliam, chief executive of Adecco Group North America, a unit of the world's largest employment staffing firm. He said many of the layoffs announced in recent months have yet to be implemented.
He predicted that between 600,000 and 700,000 more jobs will be lost in April, and that the best people can hope for is that the pace of job losses starts to slow down heading into summer.
"What we have to hope is as we get to May and June, the losses can be limited to only 300,000 or 400,000 range," Gilliam said.
The unemployment rate climbed to 8.5% from 8.1% in February, in line with economists' forecasts. It was the highest since November, 1983.
Labor Secretary Hilda Solis issued a statement citing steps that the Obama administration has taken to address the problems in job market, including the economic stimulus bill passed earlier this year, as well as steps taken to get credit flowing to small businesses.
"Today's numbers show that we have more work to do," she said.
The job losses were felt throughout all areas of the economy, with the manufacturing and construction sectors as well as business and professional services industries all cutting more than 100,000 jobs each in March.
Retailers and leisure and hospitality companies also trimmed jobs, as did the government. The only industry to post a gain in jobs during the month was the education and health care services group -- and that sector only added a modest 8,000 jobs in the month.
John Silvia, chief economist with Wachovia, said that the widespread nature of the job losses may only make the recession worse. Rising unemployment could batter consumer confidence and spending, which could lead to businesses cutting more down the road.
Silvia also expressed concern that the typical length of time people are out of work continued to climb and now stands at an average of 20.1 weeks.
"Such increases suggest that the impact on those losing jobs will be longer and more severe. Therefore we expect greater financial stress, credit delinquencies and foreclosures," he said.
Employers cut back the number of hours for their workers as well. The average hourly work week fell to 33.2 hours, the lowest level on record going back to 1964.
There also was an increase in the number of people working part-time jobs who want to get a full-time job. A record 9 million Americans were "underemployed" in March.
Including those people along with discouraged job seekers no longer counted in the main unemployment rate, the government's so-called underemployment rate stood at 15.6% in March.
Employers also cut the number of temporary workers by 72,000 in the month, taking the percentage of temporary workers in the overall work force down to the lowest level since 1994. Employers have cut 20% of temporary workers in the last six months.
Gilliam said the fact that employers are cutting temporary workers and hours are signs that some are trying to find creative ways to cut labor costs without laying people off.