Unemployment Rises in Katrina's Wake

The Washington Times (Washington, DC), October 8, 2005 | Go to article overview
Save to active project

Unemployment Rises in Katrina's Wake

Byline: Patrice Hill, THE WASHINGTON TIMES

The unemployment rate edged up to 5.1 percent last month as the economy lost jobs for the first time in two years in the wake of Hurricane Katrina, the Labor Department reported yesterday.

The number of people reporting they are out of work jumped by 270,000, reflecting deep job losses in retail, hospitality and manufacturing businesses.

The finding closely tracks a separate report on first-time claims for jobless benefits, which as of last week found 363,000 people displaced from their jobs by Hurricanes Katrina and Rita, a Gulf Coast storm that struck later in the month after the department completed yesterday's unemployment survey.

But the blow to the economy from Katrina was less than expected for the many analysts on Wall Street who give greater weight to a measure of payroll changes by businesses in yesterday's report.

That measure recorded a smaller net decline of only 35,000 jobs in September, following two robust months of job gains over 200,000.

The business survey comforted the financial markets, as it suggested that outside the hard-hit Gulf region, businesses continued to create jobs and added close to 200,000 in spite of the hurricanes, offsetting many of the storm-related losses.

"It suggests that the impact of Katrina may not have been as awful as we feared," said Bill Cheney, chief economist at John Hancock Financial Services.

The payroll figure may have been flawed, economists said, because the department was not able to reach businesses and individuals in New Orleans, which was evacuated and flooded at the time of the survey, so it had to estimate the job losses there.

"The picture is still murky and I think we'll have to wait for the employment report next month to see what kinds of reverberations and revisions occur," Mr. Cheney said.

The biggest danger to the economy, at any rate, is not so much from the job losses as from the huge spike in energy prices that resulted from the shutdown of oil and gas-production facilities in the Gulf region, he said.

"My prime concern for the rest of the year is the impact of higher energy prices on consumer spending," he said. "For large parts of the country, the cost of heating homes this winter is expected to double and gas prices are already sapping cash from consumers' wallets.

The rest of this article is only available to active members of Questia

Sign up now for a free, 1-day trial and receive full access to:

  • Questia's entire collection
  • Automatic bibliography creation
  • More helpful research tools like notes, citations, and highlights
  • Ad-free environment

Already a member? Log in now.

Notes for this article

Add a new note
If you are trying to select text to create highlights or citations, remember that you must now click or tap on the first word, and then click or tap on the last word.
Loading One moment ...
Project items
Cite this article

Cited article

Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

Cited article

Unemployment Rises in Katrina's Wake


Text size Smaller Larger
Search within

Search within this article

Look up

Look up a word

  • Dictionary
  • Thesaurus
Please submit a word or phrase above.
Print this page

Print this page

Why can't I print more than one page at a time?

While we understand printed pages are helpful to our users, this limitation is necessary to help protect our publishers' copyrighted material and prevent its unlawful distribution. We are sorry for any inconvenience.
Full screen

matching results for page

Cited passage

Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

Cited passage

Welcome to the new Questia Reader

The Questia Reader has been updated to provide you with an even better online reading experience.  It is now 100% Responsive, which means you can read our books and articles on any sized device you wish.  All of your favorite tools like notes, highlights, and citations are still here, but the way you select text has been updated to be easier to use, especially on touchscreen devices.  Here's how:

1. Click or tap the first word you want to select.
2. Click or tap the last word you want to select.

OK, got it!

Thanks for trying Questia!

Please continue trying out our research tools, but please note, full functionality is available only to our active members.

Your work will be lost once you leave this Web page.

For full access in an ad-free environment, sign up now for a FREE, 1-day trial.

Already a member? Log in now.

Are you sure you want to delete this highlight?