MarketWatch: December job toll: 524,000

More than half a million Americans lost their jobs last month, capping the worst year for US unemployment since the end of the Second World War.

The US Labour Department said today that 524,000 people were sacked in December, following 584,000 job losses in November. December's total took total US job losses for 2008 to 2.589 million - the worst unemployment number since 1945.

Investors sent the Dow Jones industrial average down 109.83 points to 8,632.63.

Nearly two million of last year's job losses occurred in the final four months of 2008 as employers including AT&T, Bank of America and Dow Chemical announced thousands of staff cuts.

At 7.2 per cent, the jobless rate in America is now at a 15-year high. The US had been prepared for the terrible figures following shocking unofficial unemployment numbers released on Wednesday.

President-elect Barack Obama yesterday acknowledged the huge economic problems facing America, warning of a "crisis unlike any we've seen in our lifetime". He urged Congress to quickly approve his $800 billion programme designed to stimulate the economy. December's figures included 21,400 job cuts in the auto and related industries, while manufacturing payrolls fell by 149,000.

The service industry, which includes shops and banks, lost 273,000 jobs.

The new year has not started cheerfully on the jobs front. Yesterday Walgreen, the drug store chain, announced 1,000 staff reductions.

Ian Shepherdson, chief US economist at High Frequency Economics, said, however, that the US may be nearing the worst in unemployment.

"Overall, a terrible report," he said of today's figures. "The only possible glimmer of light is that the maximum rate of fall of payrolls is hopefully not far off."

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