Loss of 533,000 jobs in U.S. in 1 month raises fears of how long recession will last and how painful it will get.

Economists were expecting the November national jobless report to be dismal. But they were surprised: It was worse.

Friday’s report from the Bureau of Labor Statistics found the U.S. economy lost 533,000 jobs last month, the biggest single-month plunge since 1974.

But there was something scarier: The job market typically doesn’t turn around until after the economy has spun out of recession and started growing. With even optimists saying the year-old recession will linger well into next year, that means the labor market is likely to keep decaying for even longer.

“We are going to see unemployment continue to rise for the next year or year and a half,” said Lawrence Mishel, president of the Economic Policy Institute, a Washington-based think tank. “We will have 5 [million] or 6 million more people unemployed in February 2010 and perhaps double that number who are underemployed.”

Toss in revisions to previous months, and the economy has dropped 1.9 million jobs this year —- 1.3 million in just the last three months.

The unemployment rate, calculated from a separate survey, rose to 6.7 percent from 6.5 percent, reaching the highest level since 1993.

Data on Georgia is due later this month. But so far, the state has tracked the national economy —- albeit with a moderately higher jobless rate of 7 percent.

As in Georgia, Friday’s report showed health care as one of the few categories in which jobs were being added. Otherwise, losses through the U.S. economy were widespread: Manufacturing shed 85,000 jobs and construction lost 82,000.

Most painful for an economy no longer centered on production of goods was the disappearance of a stunning 370,000 service-sector jobs. That includes 136,000 in office work and 91,000 in retail, a sector normally booming as the holidays approach.

Those job losses reflect the way in which the recession feeds on itself. With real estate values falling, foreclosures mounting and layoffs climbing, even consumers with steady jobs were becoming more cautious.

That retreat only meant more job cuts, said economist Sophia Koropeckyj, managing director of Economy.com, a Pennsylvania-based consulting and research company.

“A sharp acceleration occurred in leisure and hospitality, business services and retail trade, all industries that depend on consumer spending,” she said.

The credit squeeze of early fall just made the problem worse.

The job loss numbers are not the only signs of pain. The number of people too discouraged to even look for work rose to 608,000, more than double that of a year ago. The number of people working part time because they cannot find full-time work climbed to 7.3 million, up 2.8 million in a year.

The jobless rate for black workers edged up to 11.2 percent.

“People think that when the unemployment rate goes from 5 [percent] to 6 percent that only 1 percent of people are affected,” Mishel said. “But it’s also everyone who has a job and has to live with lower wages and those who have to work few hours.”

Last month, the average workweek dipped to 33.5 hours, a record low.

Even the apparent good news might have come from layoffs. Average hourly earnings were up slightly, possibly because more lower-paid than higher-paid jobs were being cut.

The current situation is often called the worst job market since the Depression of the 1930s. Yet the pain has been intense at other times, too.

The job loss last month represents less than 1 percent of the nation’s payroll. In comparison, the 602,000 jobs lost to a much smaller U.S. economy in December 1974 represented nearly 8 percent of the total.

Still, Friday’s figure was the worst since then, said Dorsey Farr, principal in the investment firm French Wolf & Farr. “I’d say that 533,000 is a big number, even given the size of the employment base.”

Yet that doesn’t have to mean we are plunging into an abyss, he said.

If the economy matches the average proportion of jobs lost, about 2.5 million jobs will be cut by the summer, Farr said.

“So far, this downturn doesn’t look that extraordinary, except that the decline in employment was very modest through the first seven months of the recession and has since been quite rapid,” he said.

“It is happening faster than I anticipated, but we knew where we were going —- it’s just a question of the pace.”

 Associated Press
UNEMPLOYMENT
Chart tracks the monthly unemployment rate for the past 13 months.

A second chart tracks the monthly net change in nonfarm, payroll employment, in thousands.

Source: Department of Labor