Jobs Data Raise Recession Fears on Wall Street


Wall Street stocks were set to fall on Friday after unemployment rose sharply and employers added far fewer jobs than expected last month raising fears the US economy is on the verge of tipping into recession.

Non-farm payrolls increased just 18,000 in December, compared with a revised 115,000 the previous month, the worst reading since August 2003. The payroll figure was much lower than an expected 70,000 increase.

Unemployment jumped from 4.7 per cent to 5 per cent, the highest rate since November 2005.

The construction, manufacturing and retail sectors all saw job losses which were only partially offset by gains in the professional and technical services.

US markets are acutely sensitive to unemployment data as they are considered a leading indicator of a potential economic downturn.


TradingEconomics.com, Financial Times
1/4/2008 6:53:04 AM