Unemployment – Page 23 – Infinite Unknown

Economic clouds gather as Spain faces recession

December 7, 2008 by Infinite

A demonstrator burns a note during a protest in downtown Madrid as Spain’s economic miracle threatens to unravel

For years, it has been a staple of daytime television, alongside the inane chat, creaky old movies and decorating do’s and don’ts – the “let’s-go-live-in-the-sun” show, in which Stoke and Stoke Newington are swapped for, much more often than not, Spain.

But now it has an evil twin. You may have seen it. The we’re-not-celebrities-but-please-get-us-out-of-here show, in which the dream has gone horribly wrong. And it is symptomatic of the wider malaise that has gripped what was once a land of boom and money.

After a decade in which per capita income doubled – and household debt tripled – the Spanish economic fiesta is well and truly over. More than 40,000 workers are losing their jobs each week, a far higher rate than elsewhere in Europe. Unemployment is at 2.99 million, a 12-year record of 12.8 per cent of the workforce and the highest unemployment rate in the eurozone.

And there is no respite in sight. According to Pedro Solbes, the Economy Minister: “There is a risk the unemployment rates will be worse next year.”

In November, the grim jobless figures were compounded by a further decline in the services sector as activity, new orders and employment plunged to a record low.

The Markit Purchasing Market Index, which covers service companies ranging from hotels to insurance brokers, dropped to 28.2 in November from 32.2 in October, the sharpest monthly decline since figures were first collected in 1999. The figure is drastically below the 50 level where growth begins.

And underpinning it all is the Spanish construction industry, which accounts for 9 per cent of GDP. It has collapsed. After those years of boom, more than 150 property companies have gone bust so far this year, going into administration as debts mounted and they were unable to pay back creditors.

Fears of a million layoffs a month in corporate America

December 7, 2008 by Infinite

As many as a million American jobs could be lost every month by next spring as businesses struggle to raise capital in financial markets consumed by fear, according to a new analysis.

November was the worst month in the US labour market since the oil crisis of 1974, as more than 500,000 US workers were laid off, according to official figures released on Friday.

But Graham Turner, of consultancy GFC Economics, says the rising cost of corporate debt is now flashing a red warning signal that far worse is to come over the next few months and job losses are heading for levels last seen in the 1930s Great Depression.

Corporate bond yields have rocketed since the credit crisis began as investors flee risky assets in search of safe havens such as US Treasuries. That effectively means many firms are being forced to pay eye-watering interest rates to borrow funds.

Turner says when the gap between the yield on high-risk company bonds and US Treasuries widens sharply, unemployment tends to shoot up – and current credit conditions are pointing to a doubling in the pace of layoffs, to more than a million workers a month, by spring.

‘The correlation is holding up all too well,’ he said. ‘It’s very disconcerting.’ He added that the pace of layoffs already happening in the US ‘is indicative of panic’. During the 1970s oil crisis the panic was relatively short-lived, he says. ‘But the worry now is that this will just roll on and on.’

Welfare mothers to be forced to work

December 7, 2008 by Infinite

Rt Hon James Purnell MP Secretary of State for Department of Work and Pensions.

ALMOST all benefit claimants will be forced either to look for a job or prepare for work if they want to continue to receive state handouts, under a shake-up of the welfare state.

Single mothers of children as young as one and people registered unfit for work will be compelled to go on training courses and work experience or risk cuts to their benefits.

In an interview with The Sunday Times, James Purnell, the work and pensions secretary, said: “Virtually everyone will be doing something in return for their benefits.”

Workers occupy factory; Standoff continues as workers protest layoffs

December 6, 2008 by Infinite

CHICAGO — Workers who got three days’ notice their factory was shutting its doors voted to occupy the building and say they won’t go home without assurances they’ll get severance and vacation pay they say they are owed.

In the second day of a sit-in on the factory floor Saturday, about 200 union workers occupied the building in shifts while union leaders outside criticized a Wall Street bailout they say is leaving laborers behind.

About 50 workers sat on pallets and chairs inside the Republic Windows and Doors plant. Leah Fried, an organizer with the United Electrical Workers, said the Chicago-based vinyl window manufacturer failed to give 60 days’ notice required by law before shutting down.

During the takeover, workers have been shoveling snow and cleaning the building, Fried said.

“We’re doing something we haven’t since the 1930s, so we’re trying to make it work,” Fried said.

Profiles in Panic: The World of the Rich Collapses

May 3, 2010December 5, 2008 by Infinite

With Wall Street hemorrhaging jobs and assets, even many of the wealthiest players are retrenching. Others, like the Lehman Brothers bankers who borrowed against their millions in stock, have lost everything. Hedge-fund managers try to sell their luxury homes, while trophy wives are hocking their jewelry. The pain is being felt on St. Barth’s and at Sotheby’s, on benefit-gala committees and at the East Hampton Airport, as the world of the Big Rich collapses, its culture in shock and its values in question.

Illustrations by Barry Blitt.

A snapshot: East Hampton, late summer, a lawn party at a house on the ocean overlooking the dunes. The host is a prince of private equity known for dressing well. One of his guests is Steven Cohen, the publicity-shy billionaire whose SAC Capital, with $16 billion under management, is perhaps the most revered of the 10,000 or so hedge funds spawned by this giddily rich time. Nearby is Daniel Loeb, of Third Point, one of the better-known “activist” hedge funds, who hopes to move soon into a 10,700-square-foot, $45 million penthouse at l5 Central Park West, a Manhattan monument to the new gilded age. Gliding easily between them is art dealer Larry Gagosian, so successful at selling Bacons and Serras to Wall Street’s new titans-including to Cohen-that he now travels in his own private jet and has his own helicopter to take him to it.

Zimbabwe: Civilisation in reverse

December 5, 2008 by Infinite

Zimbabwe’s tragedy defies the world to look away

The townships of suburban Harare once boasted water and sewage systems that were the envy of Africa. They are now as broken as Zimbabwe itself. Raw sewage spills from manhole covers and is pumped into the city’s main reservoir. Thousands depend on the generosity of “water samaritans” lucky enough to have their own boreholes. Where even the poorest had taps and toilets of their own, people are queueing up at hand pumps, one engineer laments. “Civilisation has gone in reverse.”

People are also dying. A cholera outbreak that has killed more than 500 people could infect 60,000 by March, according to Oxfam. The outbreak is spreading four times faster than usual for want of transport to take victims to hospital, and basic medicines for those who get there. To contain the epidemic the Health Minister has advised Zimbabweans to stop shaking hands, but it has already spread to South Africa.

In Zimbabwe’s rural hinterland five million people will soon need food aid that the World Food Programme cannot afford to distribute. The Government is powerless to count the number dying of hunger, much less hand out food itself. But aid workers have seen children foraging in rubbish dumps alongside wild animals, and in Matabeleland one story encapsulates the despair of a nation – the story of a woman who, unable to feed her children, fed them and herself a fruit that she knew was poisonous. They were buried together.

Such are the tragedies that lend meaning to Zimbabwe’s statistics; to its 90 per cent unemployment, its 230 million per cent inflation and its average life expectancy of barely 40 years. In 1990, Zimbabweans could expect to live to 63.

U.S. Economy: Employers Eliminate 533,000 Jobs, Most Since 1974

December 5, 2008 by Infinite

This has just been starting. It will get much worse.
__________________________________________________________________________

Dec. 5 (Bloomberg) — U.S. companies slashed payrolls last month at the fastest pace in 34 years as the economy headed for its deepest and longest recession since World War II.

Employers cut 533,000 jobs, bringing losses so far this year to 1.91 million, the Labor Department said today in Washington. November’s drop exceeded all 73 forecasts in a Bloomberg News survey. The unemployment rate rose to 6.7 percent, the highest level since 1993.

“It’s unbelievable,” said Nariman Behravesh, chief economist at IHS Global Insight in Lexington, Massachusetts. “We’re well on our way to the worst recession of the postwar period.”

U.S. Economy: Jobless Rolls Climb to 26-Year High; Factory Orders Drop 5.1 Percent

December 4, 2008 by Infinite

Dec. 4 (Bloomberg) — More Americans are collecting jobless benefits than at any time in the last 26 years as companies rush to cut costs in a sinking economy.

The number of people on unemployment benefit rolls rose to 4.09 million in the week ended Nov. 22, the most since December 1982, the Labor Department said today in Washington. A separate report showed orders at U.S. factories tumbled in October by the most in eight years as demand collapsed at home and abroad.

AT&T Inc., DuPont Co. and Viacom Inc. today announced plans to eliminate more than 15,000 jobs as consumer spending falters and the recession deepens. The Labor Department tomorrow will report that the U.S. unemployment rate jumped to a 15-year high of 6.8 percent in November, according to the median forecast in a Bloomberg survey of economists.

AT&T to cut 12,000 jobs

December 4, 2008 by Infinite

NEW YORK: The U.S. phone giant AT&T said Thursday that it would eliminate 12,000 jobs, about 4 percent of its work force, as it joins a raft of corporations trying to slash costs in the face of the economic downturn.

AT&T will cut the jobs over the remainder of 2008 and 2009, and take a charge of about $600 million in this year’s fourth quarter for severance.

JPMorgan Chase to cut 9,200 jobs at Washington Mutual

December 2, 2008 by Infinite

Reporting from New York — JPMorgan Chase & Co. said Monday that it would cut 9,200 jobs at Washington Mutual Bank, which it acquired Sept. 25 after WaMu became the nation’s largest bank to fail amid the continuing credit crisis.

The most cuts will come at Washington Mutual’s Seattle headquarters, where 3,400 pink slips are going out, and at the bank’s San Francisco center, where 1,600 jobs are being eliminated, JPMorgan spokesmen said.

The other 4,200 firings will be spread throughout the United States, with fewer than 300 in Southern California, they said.

No branch closures are planned in California as JPMorgan integrates Washington Mutual, so retail customers in the state will continue to see the same faces as always, the spokesmen said.

Chinese President tells party to get ready for a rough ride from world recession

December 3, 2008December 1, 2008 by Infinite

The Chinese President has issued a rare warning to the ruling Communist Party, telling his officials that the global economic downturn is so severe that it could shake its 59-year grip on power.

President Hu Jintao’s remarks, at a weekend meeting of the ruling 25-member Politburo, appeared on the front page of the party’s official mouthpiece, the People’s Daily. It was his bluntest message yet delivered on the crisis to China’s 1.3 billion people and more than 70 million members of the party.

The subtext of his speech was the increasing risk of social unrest caused by China’s rising unemployment, as a slump in exports leads to factory closures and a fall in property sales results in abandoned construction projects.

The President, who is also the head of the Communist Party, said: “In this coming period, we will starkly confront the effects of the sustained deepening of the international financial crisis and pressure as global economic growth clearly slows.” He said that the slowdown would “steadily weaken our country’s traditional competitive advantages”.

The speech is the most authoritative warning yet of the blow dealt to the world’s fourth-largest economy by the international financial crisis. Tens of thousands of migrant workers at failed factories are already heading back to their farms, and economists say that the real drop in export orders may not be felt until early next year.

1.5 Million Job Cuts So Far This Year, Factory Slump Probably Worsened: U.S. Economy Preview

November 30, 2008 by Infinite

Nov. 30 (Bloomberg) — The recession engulfing the U.S. economy deepened this month as employers slashed more jobs and manufacturing contracted at the fastest pace in a quarter century, economists said before reports this week.

Payrolls shrank by 320,000 workers in November, the biggest one-month drop since the 2001 terrorist attacks, according to the median estimate of economists surveyed by Bloomberg News before the Labor Department’s Dec. 5 report. The jobless rate may have jumped to 6.8 percent, the highest level since 1993.

Employment may keep deteriorating as the credit crunch continues to bite, with Goldman Sachs Group Inc. analysts forecasting a 9 percent unemployment rate by late 2009. The worsening outlook prompted President-elect Barack Obama to craft a plan to save or create 2.5 million jobs in two years to stave off what he called a “crisis of historic proportions.”

“All signals point to a very weak labor market and further weakening,” said Dean Maki, co-head of U.S. economic research at Barclays Capital Inc. in New York. “We should expect a large stimulus program shortly after Obama takes office.”

The 11th consecutive drop in payrolls would follow a 240,000 decline in October and bring the total number of jobs eliminated so far this year to 1.5 million. Factories probably reduced staff by 80,000 workers, according to the survey median.

The jobless rate was 6.5 percent in October.

Top Chinese official warns on downturn

November 27, 2008 by Infinite

The downturn in the Chinese economy accelerated over the past month and could lead to high unemployment and social unrest, the country’s top economic planner warned on Thursday.

Zhang Ping, chairman of the National Development and Reform Commission, said the government needed to take “forceful” measures to limit the slowdown in the economy, which included Wednesday’s large cut in interest rates and a sharp increase in fiscal spending. The rate cut was the fourth since September.

“The global financial crisis has not bottomed out yet. The impact is spreading globally and deepening in China. Some domestic economic indicators point to an accelerated slowdown in November,” Mr Zhang said on Thursday at a rare news conference.

Mr Zhang’s warning about the potential for social unrest as a result of factory closures underlined the mounting concern in Beijing about the fallout from the global financial crisis.

“Excessive production cuts and closures of businesses will cause massive unemployment, which will lead to instability,” Mr Zhang said.

His comments came a day after the mayor of Shenzhen, China’s largest export centre, said factory closures had claimed 50,000 jobs in the city so far this year after 682 factories closed or stopped production.

Americans’ Food Stamp Use Nears All-Time High

November 27, 2008 by Infinite

Fueled by rising unemployment and food prices, the number of Americans on food stamps is poised to exceed 30 million for the first time this month, surpassing the historic high set in 2005 after Hurricane Katrina.

The figures will put the spotlight on hunger when Congress begins deliberations on a new economic stimulus package, said legislators and anti-hunger advocates, predicting that any stimulus bill will include a boost in food stamp benefits. Advocates are also optimistic that President-elect Barack Obama, who made campaign promises to end childhood hunger and whose mother once briefly received food stamps, will make the issue a priority next year.

“We soon will have the most food stamps recipients in the history of our country,” said Jim Weill, president of the Food Research and Action Center, a D.C.-based anti-hunger policy organization. “If the economic forecasts come true, we’re likely to see the most hunger that we’ve seen since the 1981 recession and maybe since the 1960s, when these programs were established.”

China slashes interest rates as panic spreads

November 26, 2008 by Infinite

The People’s Bank of China cut interest rates by more than 1pc point as the economy crumbles and millions of jobs are predicted to go ahead of Christmas.

Factory workers surround a damaged police car during a protest outside Kai Da toy factory in Dongguan, China. Photo:REUTERS

The move came just one day after the World Bank predicted that China would grow by 7.5pc next year. The level of growth may appear robust by Western standards, but it would represent the slowest economic expansion in China for the last two decades.

It is also perilously close to the 7pc minimum level of growth that Chinese economists believe is necessary in order to create enough jobs for the 6m university graduates who will enter the jobs market next year.

Factory workers smash an office during a protest at Kai Da toy factory in Dongguan, China. Photo: REUTERS

It is the fourth interest rate cut from the Chinese central bank in the last ten weeks as the government desperately battles an evident economic collapse. “China is out to save itself here,” said Patrick Bennett, an analyst with Societe Generale in Hong Kong.

The PBOC reduced its main borrowing rate by 1.08pc points to 5.58pc, the biggest one-off cut since the Asian Financial Crisis in 1997.

In recent weeks, a series of riots across central and southern China have flowered as disgruntled employees aired their grievances at the downturn.

More than 80,000 jobs cut in just five days

November 22, 2008 by Infinite

More than 80,000 job losses were announced around the world this week as the global recession tightened its grip in virtually every business sector.

A Financial Times study of company announcements, press briefings and union statements over the past five working days reveals the spread and depth of the downturn.

Jobs have haemorrhaged from businesses as diverse as a Chicago kosher hot dog factory, a German airline and car plants in Japan. Companies have been forced into savage cost cutting as the effects of the credit crunch have sapped confidence and sent order books and commodity prices plummeting.

Almost 30,000 job losses have been announced by British companies alone in the past two weeks.

Toyota Will Cut 3,000 Jobs in Japan as Car Sales Fall

November 21, 2008 by Infinite

Workers assemble engines of Toyota Motor Corp.’s Lexus LS600 hybrid sedan on the production line at its Tahara plant in Tahara, central Japan, on June 28, 2007. Photographer: Kimimasa Mayama/Bloomberg News

Nov. 21 (Bloomberg) — Toyota Motor Corp., Japan’s biggest carmaker, will cut its domestic temporary workforce by 50 percent as vehicle demand slumps globally.

Toyota will cut the number of temporary workers to 3,000 from 6,000 by the end of March, spokesman Paul Nolasco said today in a phone interview.

The automaker follows Mazda Motor Corp. and Isuzu Motors Ltd., which yesterday said they would slash a combined 2,700 temporary jobs in Japan in response to slowing sales. Earlier this month, Toyota forecast a 68 percent drop in full-year net income, the biggest decline in at least 18 years, as a global recession cripples auto demand.

Top official meets rioters as China seeks stability

November 21, 2008 by Infinite

Wrecked cars are seen outside a damaged building in Wudu town, Longnan city, Gansu province in this video grab from CCTV footage of November 20 released November 21, 2008. REUTERS/CCTV via Reuters TV

BEIJING (Reuters) – The governor of a Chinese province sat down with protesters after they fought pitched battles with police, a rare concession by a leader and a sign of government concerns about stability as the economy slows.

Xu Shousheng held a meeting with 10 representatives in Wudu in the poverty-stricken northwestern province of Gansu two days after the riot in which dozens were injured, state media said.

Minister of Human Resources and Social Security Yin Weimin said on Thursday stabilizing employment was the top priority for China as he revealed a rise in jobless workers triggered by a weakened export sector.

The protests were sparked by local residents’ worries about a government resettlement plan after the May 12 earthquake killed more than 80,000 people, and in Gansu alone made 1.8 million people homeless.

JPMorgan May Fire 10 Percent of Investment Bank Staff

November 20, 2008 by Infinite

Nov. 20 (Bloomberg) — JPMorgan Chase & Co., the largest U.S. bank, plans to fire about 10 percent of its investment banking staff, or about 3,000 people, as the global economy slides into recession, a person familiar with the bank said.

The reductions are in line with New York-based JPMorgan’s rivals, including Goldman Sachs Group Inc., which said it will eliminate about 10 percent of staff. JPMorgan’s cuts will be global and include various groups within the investment bank, the person said, speaking anonymously because the news isn’t yet public. Some employees at the New York-based firm have been notified.

“There are aggressive cuts going on everywhere,” said Rupert Della-Porta, the London-based chief operating officer of research firm Atlantic Equities. “There are marked differences between business conditions now and the forward views that even the most conservative managers had. JPMorgan has to right-size their business model.”

JPMorgan also plans to freeze base salaries next year for most employees who earn more than $60,000 to $70,000, another person said. Tasha Pelio, a spokeswoman for JPMorgan declined to comment. JPMorgan’s decision to fire employees was reported earlier by the Sunday Telegraph and Reuters.

Fed sharply lowers forecasts, hints of rate cut

November 20, 2008 by Infinite

Fed sharply lowers economic forecasts for this year, 2009; signals another rate cut coming

WASHINGTON (AP) — The Federal Reserve on Wednesday sharply lowered its projections for economic activity this year and next, and signaled that additional interest rate reductions may be needed to help combat the worst financial crisis to jolt the country in more than a half-century.

With the economy forecast to lose traction, or even jolt into reverse, unemployment will move higher, the Fed predicted.

Facing the likelihood of “significant weakness” in the economy, some Fed officials suggested “additional policy easing could well be appropriate at future meetings,” according to documents from the Fed’s most recent closed-door deliberations on interest rate policy at the end of October.

Independent to shed quarter of journalists

November 18, 2008 by Infinite

The Independent newspaper and its Sunday sister title will cut up to a quarter of their editorial staff in one of the most savage cuts to hit the UK newspaper industry in recent years, as management seeks £10m of savings the company said on Tuesday.

The UK operations of Sir Tony O’Reilly’s Independent News & Media (INM) will see a total of 90 employees made redundant by early 2009 out of a total of 424 staff in its London office. But the brunt of the cuts, about 60 jobs, will come from the 250 or so editorial staff.

50,000 estate agents face axe in next nine months

November 17, 2008 by Infinite

Experts have warned that up to 50,000 estate agents may lose their jobs in the next year

As many as 50,000 estate agents could lose their jobs by next Autumn because of the worsening economic crisis, experts today warned.

Economists said the collapse in the housing markets meant the true figure would be double previous predictions of 15,000 job losses, with some experts forecasting at least 50,000 out of work by next year.

The panic has led to some businesses making desperate attempts to secure their survival, with one estate agent even converting part of his office into a cafe to generate extra income.

Ben Read, managing economist at the Centre for Economics and Business Research, said the toll of job losses would be shocking.

He told the Evening Standard: ‘It will definitely be worse. The housing market has dropped significantly more since May and the outlook for the next nine months is pretty ropey.

‘Because of the worsening situation in the economy you could easily expect that figure of 15,000 to go up by 50 per cent. The true figure could even be as much as 50,000.

‘Most estate agents have let go significant numbers of staff and are working on skeleton staff. I’m sure it will surprise everyone how bad it is.’

Chrysler leaders get millions

November 16, 2008 by Infinite

Unsold Chrysler products sit at a dealership in Dormont, Pa.

As Detroit’s crumbling auto industry asks Congress for a bailout, Chrysler is in the awkward position of paying about $30 million in retention bonuses to keep top executives while the company cuts thousands of jobs.

Chrysler owes the bonuses under its contracts with about 50 executives, based on a retention incentive plan crafted early last year by former German parent DaimlerChrysler, when it was preparing to sell the Chrysler unit.

Related article: Daimler: Chrysler worth nothing

Nancy Rae, Chrysler executive vice president for human resources and communications, said the move made sense at the time to ensure potential buyers that key Chrysler executives would remain in place after a sale. She acknowledged that the bonuses could be seen as controversial now.

GM Collapse at $200 Billion Would Exceed Bailout Tab, Firm Says

November 15, 2008 by Infinite

Nov. 15 (Bloomberg) — General Motors Corp., burning through cash as sales slump, would cost the government as much as $200 billion should the biggest U.S. automaker be forced to liquidate, a forecasting firm estimated.

A GM collapse would mean “more aid to specific states like Michigan, Ohio, and Indiana, and more money into unemployment and extended benefits,” Nariman Behravesh, chief economist at IHS Global Insight Inc. in Lexington, Massachusetts, said yesterday in an interview.

Behravesh’s projection of $100 billion to $200 billion in costs dwarfs the $25 billion industry bailout plan that will be debated in Congress next week to prop up Detroit-based GM, Ford Motor Co. and Chrysler LLC. The drain on taxpayers from a rescue or a GM failure is a central issue for U.S. lawmakers.

Included in the Global Insight estimate, which Behravesh supplied to Bloomberg News, are the anticipated costs for existing programs, such as unemployment insurance, and new measures that the economist said would be needed to revive economic growth after millions of auto-related job losses.

A GM shutdown would wipe out jobs among suppliers as well as at the automaker itself, pushing the U.S. unemployment rate next year to 9.5 percent, compared with current projections of as high as 8.5 percent, Behravesh said.

Citigroup to lay off another 10,000 – report

November 14, 2008 by Infinite

Financial services company said to be adding to the 23,000 lost jobs from the last four quarters.

NEW YORK (CNNMoney.com) — Citigroup is getting ready to lay off thousands of workers and raise credit card interest rates, according to a published report Friday.

The battered financial services company will be laying off 10,000 workers, on top of the 23,000 job cuts it has already made over the last four quarters, reported The Wall Street Journal.