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Economists see long, tough road to job recovery

The U.S. economy unexpectedly lost 85,000 jobs last month, after posting its first employment growth in 23 months in revised November figures. Some economists warned of more tough times as the worst job market in a generation tries to regain its footing.

But December's loss surprised some economists. Those surveyed by Bloomberg News expected December's number to move little from November. That month's original 11,000 loss was revised to a gain of 4,000 jobs, the first job growth since December 2007, when the recession began.

The unemployment rate was 10 percent last month, unchanged from the month before, according to federal data released Friday. The United States now has 15.3 million unemployed workers, nearly double the number at the recession's start, and some economists don't expect much improvement in the unemployment rate this year.

In fact the rate could get worse before it gets better as discouraged workers begin looking for jobs again. Discouraged workers, who give up looking for work, aren't counted in unemployment statistics. Their numbers rose to 929,000 in December, up from 642,000 in December 2008.

Ken Goldstein, an economist for The Conference Board, a Manhattan business-research group, believes the 10 percent unemployment level will be a mainstay in 2010.

He said that slowed consumer and business spending and tighter bank lending will continue to depress the job market. The hard-hit employment market will take a while to recover, even though he believes a turnaround is on the horizon.

"When we do make this turn, it's going to be a very long, very tough road," Goldstein said. "We are going to crawl out. We aren't going to run out."

In remarks at the White House, President Barack Obama said the unexpected losses show that "the road to recovery is never straight." He also highlighted the awarding of $2.3 billion in tax credits for clean-energy projects that are expected to generate 17,000 jobs, according to Bloomberg.

Some sectors added jobs but others shed some. The temporary-help services, considered a harbinger of permanent hiring, added the most jobs last month - 47,000. The sector added 52,000 in November.

Manufacturing had the second-highest losses, 27,000, but those losses narrowed significantly from the negative 41,000 in November.

Charles Hansen, the director of manufacturing at Visiontron Corp. in Hauppauge, said the construction downturn has meant fewer orders for his company, which makes posts and ropes used to direct consumer traffic in banks and other businesses. The company has 55 employees, down 15 percent in the last year.

"Before I start hiring, I am going to have to see the orders, the flow of work coming back into the plant," Hansen said.

He had no idea when that might be.

"I have been in manufacturing all my adult life," he said. "This is the hardest set of circumstances to figure out."

State data released last month show that Long Island lost jobs at an annual rate of 30,600 in the 12 months that ended in November. Unemployment edged down to 6.8 percent, from 7.2 percent in October.

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