NEW YORK (Reuters) - The U.S. unemployment rate, which rose more than expected in October to 10.2 percent, confirms a “deeper and more protracted” problem in the labor market, Mohamed El-Erian, chief executive of bond giant Pacific Investment Management Co (PIMCO), said in an interview on Friday.
“Today’s unemployment numbers confirm that, unfortunately, the problem is becoming deeper and more protracted,” El-Erian told Reuters.
“It’s not just the increase in the headline number to 10.2 percent. It’s also about the longer-term nature of unemployment, the increase in underemployment, and the prospect for only a very gradual recovery.”
Payrolls fell by 190,000 workers last month, compared with a drop of 175,000 anticipated by economists, the Labor Department said. The jobless rate was the highest since April 1983 and had gained from 9.8 percent in September.
El-Erian said: “This jobs report will place unemployment even more front and center on the political agenda. The challenge for the government is that unemployment will get worse before it gets better, and there is no quick way to counter this unfortunate development.”
Editing by Jeffrey Benkoe