Economy loses 80,000 jobs

NEW YORK (CNNMoney.com) -- U.S. employers slashed jobs on their payrolls for the third straight month in March and unemployment rose to a nearly three-year high, offering the latest signs that the economy has fallen into a recession.
The Labor Department's much anticipated report showed a net loss of 80,000 jobs in the month, marking the longest period of decline since early 2003.
February's loss was revised to 76,000 jobs. Economists surveyed by Briefing.com had forecast that payrolls would fall by 50,000 in the latest reading.
The job losses in both January and February were revised sharply higher, adding an additional 67,000 job losses to the previous readings. The Labor Department now estimates that the economy has shed 232,000 jobs in the first three months of this year.
The job losses were widespread, with the battered construction sector losing 51,000 jobs and manufacturing employment falling by 48,000. But there were also losses in key service sector industries. Retail employment dropped by 12,000 jobs, and business and professional service employers cut staff by 35,000.
The unemployment rate jumped from the 4.8% reading in February to 5.1%, the highest level since May 2005. Economists had forecast that unemployment would rise to 5%.
The unemployment rate is based on a separate survey of households, rather than the employer survey that produces the closely watched payroll number.
The household survey gave an even grimmer view of the job losses in the economy, with the number of Americans saying they were unemployed soaring by 434,000, the biggest jump in that reading since October 2001, right after the Sept. 11 attacks.
The job outlook will be a key factor influencing interest rate decisions by the Federal Reserve when it meets on April 29 and 30.
Earlier this week Fed Chairman Ben Bernanke made his bleakest and bluntest assessment on the economy's condition. The central bank chief told a joint Congressional committee that a recession is possible in the first half of this year.