In a shower of pink slips, U.S. employers cut jobs last month for the first time in more than four years, the starkest signal yet that the economy is grinding to a halt if it hasn’t already toppled into recession reports the Associated Press in the San Francisco Chronicle.

 

Conditions are deteriorating, according to the latest employment snapshot by the Labor Department, which showed nervous employers slicing payrolls by 17,000. The country hadn’t seen such a nationwide job loss since 2003, when employers were still struggling to recover from the last previous recession.

 

“We are certainly on thin ice,” said John Silvia, chief economist at Wachovia. And even President Bush, normally a cheerleader for the economy, said there were “serious signs” it was weakening.

 

Wall Street, however, took the news in stride. The Dow Jones industrials rose 92.83 points to 12,743.19.

 

Job losses were widespread in January. Factories, construction companies, mortgage brokers and real-estate firms were among those eliminating jobs — casualties of the housing bust and credit crunch. The government cut jobs for the first time since last July.

All those cuts swamped job gains in education, health care, retailing and elsewhere. The unemployment rate actually dipped slightly to 4.9 percent, from 5 percent in December, as people left the labor force.

 

“Discouraged by a sluggish job market, many more adults are sitting on the sidelines,” said Peter Morici, an economist and business professor at the University of Maryland.

 

Wage growth also slowed, another indication of belt-tightening. Smaller wage gains could make people who still have jobs — already squeezed by high energy prices — reluctant to spend, further hurting the economy.

 

Read it here: Employment Drops in a Pink Slip Blizzard