NEW YORK (Reuters) - The U.S. labor market will experience severe contraction and “serious job bleeding” for at least several more months, Joel Prakken, chairman of Macroeconomic Advisers, said on Wednesday.
Earlier, the ADP National Employment Report, which was jointly developed by Prakken’s economic research firm and ADP Employer Services, showed U.S. private employers axed a staggering 742,000 jobs in March, nearly 100,000 more than what analysts had forecast.
Prakken said in a teleconference with reporters he expected “serious (job) bleeding” to be similar to that in March for the “next several months.”
In response to a question, he said the U.S. unemployment rate will rise to 9.5 percent by mid-2010, above the 8.1 percent reported for February.
“There are no companies which have been untouched,” Prakken said.
While the government’s massive stimulus program could save up to 2.5 million jobs and contribute 2.5 percentage points to GDP, it will not create new jobs, Prakken said. “It will just get us back to full employment faster,” he added.
Not all the day’s jobs news was horrid.
U.S. companies planned to layoff 150,411 workers in March, the fewest since October, according to outplacement firm Challenger, Gray & Christmas said earlier Wednesday.
Reporting by Richard Leong, Editing by Walker Simon,
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