WASHINGTON (May 2) - The nation's unemployment rate jumped to 6 percent in April and companies slashed jobs for the third straight month - particularly in manufacturing, airlines and department stores - as the fragile economy continued to quash hiring prospects.
Last month's jobless rate was up two-tenths of a percentage point from March, with payrolls falling by 48,000, the Labor Department reported Friday. Those figures matched economists' expectations.
The economy has lost more than half a million jobs in the past three months as the number of unemployed workers surged to 8.8 million. Nearly 2 million people have been jobless for 27 weeks or more.
''There's just no denying that these are an awful set of job figures for April,'' said Ken Mayland, president of ClearView Economics in Cleveland.
But now that the war is over, hopefully the jobs market has hit rock bottom, Mayland said. Other indicators, such as lower gasoline prices and a surge in consumer confidence, suggest that modest hiring could resume.
''It would be my best judgment that we've now seen the worst,'' he said.
In a separate report, the Commerce Department said factory orders rose 2.2 percent in March, an improvement over the 1.0 percent decline registered in February and the largest gain in eight months.
The jobless rate has hovered at or near 6 percent for more than a year. The last time it was higher was in July 1994, when the rate was 6.1 percent as the country was emerging from a previous recession.
Some economists think the rate could continue to climb through the summer because improvements in the economy could take some time to trickle down into hiring.
White House spokesman Ari Fleischer, traveling with President Bush in California
, said, ''Unemployment is a lagging indicator, and Congress must not lag in its responsibility to pass his job and growth package.''
Bush wants Congress to pass at least $550 billion in tax cuts, including eliminating taxes on corporate dividends, as a way to jump start the economy.
But support for the package is tepid, and Democrats say a better way to stimulate the economy would be to extend unemployment benefits a second time. The current extension expires at the end of the month, cutting off benefits for millions of jobless workers.
''There is no better stimulus than providing assistance to families who will spend it quickly,'' said Rep. Pete Stark of California, top Democrat on the Joint Economic Committee.
April's jobless rate increase was caused in part by 680,000 people returning to the labor force. The ouster of Saddam Hussein's regime in Iraq boosted Americans' confidence, sending many unemployed people back out to look for work. But their searches yielded little results because the economy wasn't healthy enough to create new jobs.
Even before the war, businesses were wary about making big spending and hiring commitments in a weak economy struggling toward recovery.
A big fear among economists is that consumers, whose spending accounts for two-thirds of all U.S. economic activity, will continue to keep their wallets closed as layoffs continue and hiring remains stagnant. That scenario would result in even more job losses.
Given the muddled economic environment, analysts think the Federal Reserve will continue to hold the federal funds rate at 1.25 percent, a 41-year low, when it meets next week.
In the jobs market, a healthy economy adds 200,000 to 250,000 new jobs each month, Mayland said. It could be a long time before those days return.
The costs associated with hiring new employees have skyrocketed, particularly for health care and pension benefits. Companies will make do with their existing force for as long as possible, working employees longer hours and doling out more overtime pay.
''Companies are going to want to keep the headcount down to their most minimum levels,'' Mayland said. ''That's going to delay us getting back to so-called normal times.''
Factories, which have been hardest hit in the recession, shed another 95,000 jobs in April. Those losses were widespread, with notable declines in motor vehicles, fabricated metals and electronics equipment.
In the services sector, employers added 25,000 jobs overall. Continued job losses in the airlines industry, which cut 18,000 jobs last month, held down overall gains. Overall, the air transportation category has lost 177,000 jobs since an employment peak in January 2001.
Also in the services sector, department stores cut 34,000 jobs last month. But those losses were partly offset by gains in restaurants and bars. Employment in amusement and recreation services fell 41,000, and hotels cut 20,000 jobs. Construction employment rose by 18,000.