U.S. Jobless Rate Hits 3.5 Year High in May

For Americans, never has the expression “don’t quit your day job” been more timely and appropriate.

The U.S. unemployment rate has risen sharply in recent months to hit 5.5%, the highest it has been since October 2004.

One of the people who has been aversely affected by the struggling economy is NowPublic contributor master_jim2008, who recently lost his job and his home, and has been writing about his experience. Follow his most recent stories here and here.

Have you or your family been affected by the declining American economy? Share your experience on NowPublic by posting a story or commenting below.

The U.S. unemployment rate jumped by the most in 22 years in May, reaching its highest level in more than 3-1/2 years and underscoring the recessionary risk the economy still faces.

The jobless rate rose to 5.5 percent last month from 5 percent, its highest level since October 2004, the Labor Department said on Friday. Some 49,000 jobs were cut from payrolls in May, the fifth straight month of job losses.

Wall Street economists surveyed by Reuters forecast that 58,000 jobs would be lost in May, but had foreseen the unemployment rate rising only to 5.1 percent. So far in 2008, job losses have totaled 324,000, the department said.

The surprisingly high jobless rate shocked financial markets, causing prices for U.S. Treasury bonds to rise as investors bet the dismal employment outlook pushed back any possibility of early interest-rate rises from the Federal Reserve.

The dollar’s value fell against other major currencies and stock futures dropped.

“Let’s be clear: the economy is still very weak,” [Paul] Ashworth, [senior US. economist with London-based Capital Economics] said. “The economy has little forward momentum, employment is shrinking and the unemployment rate could reach 6 percent by the end of the year.”

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