Unemployment rate hits record highs in September

Unemployment continued to rise in September, as the Bureau of Labor and Statistics released data on Friday showing that the federal unemployment rate hit levels not seen in more than 26 years.

According to the BLS, nonfarm payroll unemployment declined by 263,000 in September. The declineexceeded estimates by economic experts who had forecast more conservative job loss figures that ranged from 175,000 to slightly more than 200,000.

Because of the larger than expected rate of job loss, the unemployment rate increased by 0.1 percentage points to hit 9.8 percent, driven primarily by losses in the construction, manufacturing, retail trade, and government sectors.

The BLS data supports what has become a chorus of warnings from Federal Reserve officials who have warned that a continued rise in unemployment will occur despite other economic improvements. While speaking to the Georgia State College School of Business in Macon, Atlanta’s Fed President Dennis Lockhart echoed the opinions of Fed Chairman Ben Bernanke in saying that unemployment rates were likely continue to rising into 2010.

"To bring people back to work, it’s going to take a while," said Lockhart, according to the Wall Street Journal. "Unemployment’s going to be frustratingly high for some period of time."

The rise in monthly unemployment figures came just days after the Department of Labor released weekly figures that showed the week of September 26 had 551,000 unemployed workers seeking debt solutions by filing initial unemployment insurance claims, an increase of 17,000 from the week prior.