U.S. jobless rate at 9.5%

Employers cut a larger-than-expected 467,000 jobs in June, driving the unemployment rate up to a 26-year high of 9.5%, suggesting that the economy’s road to recovery will be bumpy. The Labor Department report, released today, showed that even as the recession flashes signs of easing, companies likely will want to keep a lid on costs and be wary of hiring until they feel certain the economy is on solid ground. June’s payroll reductions were deeper than the 363,000 that economists expected and average weekly earnings dropped to the lowest level in nearly a year. However, the rise in the unemployment rate from 9.4% in May wasn’t as sharp as the expected 9.6%. Still, many economists predict the jobless rate will hit 10% this year, and keep rising into next year, before falling back. All told, 14.7 million people were unemployed in June. If laid-off workers who have given up looking for new jobs or have settled for part-time work are included, the unemployment rate would have been 16.5% in June, the highest on records dating to 1994.