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TD Economics
Commentary
February 6, 2009
U.S.: THREE CONSECUTIVE HALF-MILLION
MONTHLY JOB LOSSES
• U.S. nonfarm payrolls dropped a further massive
598K in January
• The unemployment rate surged to 7.6%
• Net revision was -385K for all of 2008
The U.S. economy shed a further 598K jobs in Janu-
ary, bringing the number of jobs lost so far since the cycli-
cal peak of January last year to 3.6 million, which is well
over the 2.8 millions jobs lost during the recession of the
early 1980s. Market consensus was for a more modest
loss of 540K. The loss in January represented the biggest
monthly drop in the ranks of U.S. employment in the post-
war period, and was the third consecutive month in which
over half-million jobs have been lost in the U.S. The an-
nual 2008 revisions reported in this release revealed a net
loss of 385K jobs. Arguably, this report would have been
even worse if January weather conditions had not been
unusually friendly – this prevented the loss of a further
118K jobs.
The unemployment rate spiked to 7.6% (from 7.2% in
December), and is now the highest rate of joblessness
since the 1990 recession. And when “discouraged” work-
ers are added to the mix the rate rises to 8.0% from 7.6%
in December. The rate of “underemployment” is also quite
troubling, and the inclusion of these workers pushes the
rate to 13.9% in January, from 13.5% in December.
For further information, contact Beata Caranci at 416-982-8067.
TD Economics Commentary
The details of the report were quite grim. As has been
the case in the past few months, virtually every sector posted
job losses, with only the acyclical government (+6K) and
education and health sector (+54K) posting any gains. On
the other hand, there were dramatic losses in construction
(-111K), manufacturing (-207K), trade and transportation
(-118), and business services (-121K). And the losses were
equally split between the goods-producing (-319K) and serv-
ices-producing (-279K) sectors.
In terms of wage pressures, average hourly earnings
rose to 4.4% Y/Y from 3.9% Y/Y in December, while av-
erage weekly earning eased to 2.4% Y/Y from 2.6% Y/Y.
And as an indication of further rationalisation in hours
worked, total private sector weekly hours declined for the
fifth consecutive month in January, falling by 0.7% M/M,
following the 0.8% M/M drop in December. This is roughly
twice as large a drop as one would have expected given
the number of jobs lost.
With the U.S. economy well into what is widely ex-
pected to be its most intense and prolonged recession since
the Great Depression, the job losses have not only mounted,
but with the economy expected to weaken even further
there is every indication that job losses will climb even more
as employers continue to shed jobs in the face of plunging
consumer demand for their products.
Millan Mulraine
Economics Strategist
TD Securities
February 6, 2009
 www.td.com/economics

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TD Economics Commentary February 6, 2009