Joblessness mounts during grim February

WASHINGTON — February is shaping up to be another brutal month of job losses: The number of laid-off workers receiving unemployment benefits hit an all-time high of nearly 5 million, and new jobless claims are at levels not seen since the early 1980s.

The Labor Department reported Thursday that the number of people receiving regular unemployment benefits rose by 170,000 to 4.99 million for the week ending Feb. 7, marking the fourth-straight week continuing claims have hit a record.

The surge in joblessness has pushed those claims far above the 2.77 million people getting benefits a year ago. The number totals 6.54 million with the inclusion of an additional 1.5 million people who are getting extended benefits under a program passed by Congress last summer.

And those numbers are sure to climb higher, based on the flood of newly laid-off workers seeking benefits. The government reported Thursday that new jobless claims for last week totaled 627,000, the same level as the previous week but higher than economists expected.

In other economic news, wholesale inflation surged unexpectedly in January, according to the Labor Department. Wholesale prices jumped 0.8 percent last month, the biggest gain since July and well above the 0.2 percent increase that economists expected.

The acceleration was led by a 3.7 percent surge in energy prices. Gasoline prices jumped 15 percent, the biggest gain in 14 months.

Meanwhile, the New York-based Conference Board said its January index of leading economic indicators rose 0.4 percent, the second-straight monthly gain.

However, economists dismissed the gains in both wholesale prices and economic indicators as temporary blips that did not signal either a problem with inflation or a potential rebound in the economy.

The Conference Board said the single biggest boost to the index was the real money supply. The government's effort to address the credit crisis has put more money in circulation, but banks still have not returned to normal loan operations.

The cascade of layoff notices in recent weeks has shown that many employers are starting to trim payrolls drastically, abandoning hopes they could retain workers until a rebound took hold.

Goodyear Tire & Rubber Co., said Wednesday it will cut nearly 5,000 jobs, or almost 7 percent of the biggest U.S. tire maker's work force, this year after it posted a fourth-quarter loss and revenue sank 21 percent. The cuts follow the elimination of about 4,000 jobs in the second half of last year.

General Motors Corp. and Chrysler on Tuesday filed plans with the government more than doubling their request for aid to a total of $39 billion and announced plans for thousands more job cuts. GM alone said it would cut 47,000 jobs globally by the end of the year — 19 percent of its work force, and Chrysler said it will cut 3,000 more jobs.

Borders Group Inc. said Thursday that it will cut 136 jobs at its headquarters.

The company said the cut represents about 12 percent of its work force at its Ann Arbor, Mich., headquarters and about 1 percent of its total work force. The reduction is effective immediately and spread across nearly all of its departments.

And auto parts maker Autoliv said it is laying off about 7 percent of its Utah work force — or 250 workers — because of the downturn in the automotive market.

Spokeswoman Kathy Whitehead says the company has been forced to make cuts to its production, development and technical staff.

Autoliv, which makes air bags and seat belts, employs about 37,500 people around the world. Since last July, it has laid off 5,900 workers.

For the week ending Feb. 7, the states with the largest increases in jobless applications were Kentucky and Arkansas, which blamed the jumps on rising layoffs in the mining, trade and manufacturing industries. The biggest decreases were recorded in California and Tennessee, which reported fewer layoffs in the construction, trade, service and manufacturing industries.

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