Off The Cliff

533,000.

Skittish employers slashed 533,000 jobs in November, the most in 34 years, catapulting the unemployment rate to 6.7 percent, dramatic proof the country is careening deeper into recession.

As companies throttled back hiring, the unemployment rate bolted from 6.5 percent in October to 6.7 percent last month, a 15-year high.

"These numbers are shocking," said economist Joel Naroff, president of Naroff Economics Advisors. "Companies are sharply reacting to the economy's problems and slashing costs. They are not trying to ride it out."

The unemployment rate would have moved even higher if not for the exodus of 422,000 people from the work force. Economists thought many of those people probably abandoned their job searches out of sheer frustration. In November 2007, the jobless rate was at 4.7 percent.

And job losses in September and October were revised downward as well. Basically it's something like 750,000-800,000 less jobs in all. And combine this with the really pathetic retail sales figures in November.

By the way, people holding their breath that the credit crisis is over had better think again. It's not, despite hundreds of billions of dollars pumped into banks. And that's driving the job loss. If small businesses can't receive credit, they're not going to increase payroll or even keep it the same.

I don't know what the President-elect can do about this and I think it's pretty silly to criticize him for, what, not storming the gates of the White House and taking over, but clearly this interregnum period is having disastrous effects. With more Administration meetings on the "Bush legacy project" than the economy, seemingly, there's really nobody at the controls of the ship of state.

"At a time of great crisis with mortgage foreclosures and autos, he says we only have one president at a time," (Barney) Frank said. "I'm afraid that overstates the number of presidents we have. He's got to remedy that situation."

But how? He can start making some calls and leaning on lawmakers, I suppose. But to what end? We're not going to pass a trillion-dollar stimulus while George Bush is still President.

I think people have to get used to the fact that nobody really knows the proper course of action here. This is a very scary time.

UPDATE: Obama statement:

"The 533,000 jobs lost last month, the worst job loss in 34 years, is more than a dramatic reflection of the growing economic crisis we face. Each of those lost jobs represents a personal crisis for a family somewhere in America. Our economy has already lost nearly 2 million jobs during this recession, which is why we need an Economic Recovery Plan that will save or create at least 2.5 million more jobs over two years while we act decisively to maintain the flows of credit on which so many American families and American businesses depend.

"There are no quick or easy fixes to this crisis, which has been many years in the making, and it's likely to get worse before it gets better. But now is the time to respond with urgent resolve to put people back to work and get our economy moving again. At the same time, this painful crisis also provides us with an opportunity to transform our economy to improve the lives of ordinary people by rebuilding roads and modernizing schools for our children, investing in clean energy solutions to break our dependence on imported oil, and making an early down payment on the long-term reforms that will grow and strengthen our economy for all Americans for years to come," said President-elect Obama.

There's been a subtle shift in language. Now we're talking about saving or creating 2.5 million jobs. I think that's a signal that recovery money will go to state and local governments to fill the holes in their budgets. But beyond that, it's a bad sign. Because it means Obama no longer thinks it realistic to create that many jobs. 2009 is going to be awful. And there will be many who blame him.