The U.S. economy lost 85,000 jobs last month while the unemployment rate held steady at 10 percent.
The Labor Department released the disappointing figures in its worse-than-expected December report Friday. IG Markets senior market analyst Dan Cook explains how the financial community is responding.
"The reaction is definitely negative," said Dan Cook. "Although I don't think everybody necessarily believed that things were as rosy or as good as what we saw last month, seeing a number of 85,000 jobs lost was pretty bad, particularly where we had just come from, people started to speculate that hey, we might actually see growth, and it was when those hopes were dashed that I think it had even a more profound effect."
The December report followed an encouraging November report, and has experts projecting the financial recession to be more prolonged than they previously predicted.
Cook says many of the report's findings could be misleading and, to get the full financial picture, you have to dig deep into the data.
For example, December's unemployment rate appears to have stayed the same as the previous month, at 10 percent. However, Cook says when factoring in those people working part-time who would prefer full-time work and those who have become discouraged and stopped seeking jobs, the total so-called "underemployment rate" for December rose to 17.3 percent from 17.2 percent in November.
On the positive side, the report notes about 47,000 people were hired as temporary workers during the month. As companies typically hire workers on a temporary basis before bringing them on permanently, Cook says this number certainly seems cause for optimism. However, he notes these workers may have been brought on as seasonal employees. He says we won't know until February whether their work status has been made permanent.
Looking ahead, Cook summarizes this latest jobless report and says financial experts are watching for President Barack Obama to provide immediate relief.
"The sky isn't falling as we probably felt it was last year at this time, but there's definitely a lot of work that needs to be done, and it's not a rosy picture by any means," he said.
He says while big banks saw improvements thanks to economic stimulus deals in 2009, small- and medium-sized businesses have yet to feel positive effects.
"Hopefully as we move into the later stages of this year we start to see some of those stimuluses really trickle down and really start to bolster the true economy and get down to Main Street where it belongs," said Cook.
December marked two years since the start of the worst U.S. recession in decades, which has seen a net loss of more than seven million American jobs.