Unemployment has hit a 25-year high, but analysts say it will worsen as job cuts force consumers to cut back, triggering yet more payroll reductions, Bloomberg reports. Manufacturers, service providers, and even the US Postal Service are planning to lay off workers in the face of declining consumer demand. “We expect labor-market conditions to remain appalling for many months to come,” said one US economist.
Employers, panicked despite a revived stock market, may be the economy's worst enemy. “In the past, businesses seemed to show a bit of caution,” one analyst said. “Now, the philosophy seems to be cut massively now and ask questions about whether too much has been done later.” In addition to 633,000 layoffs last month, hours worked by employees per week has fallen steadily to 33.2, the lowest since record-keeping started in 1964.