WASHINGTON, Oct. 5 (UPI) -- The Labor Department on Friday reported that the unemployment rate in September remained unchanged at 4.9 percent, but reflected the largest decline in jobs in a decade.
The release of the unemployment figures indicate the economy was struggling prior to the terrorist attacks on Sept. 11 that completely destroyed the World Trade Center Twin Towers in New York City's financial district and severely damaged the Pentagon building outside Washington. Wall Street economists were expecting the jobs to decline by 100,000 while the unemployment rate was expected to rise to 5.0 percent.
"The president is concerned about the current economic situation," said Deputy Press Secretary Scott McClellan. "But that's why he worked quickly to pass tax relief. That's why he's working with Congress to provide more immediate help."
The unemployment rate at the end of August was 4.9 percent, the highest in four years. In the week ending Sept. 22, the number of unemployment insurance claims rose by 58,000 to 450,000, according to the U.S. Department of Labor. As of the end of last week, that number jumped to 528,000 unemployment claims.
The news comes as the White House and Congress have been working to forge an economic stimulus package aimed at boosting the ailing economy. And it emerges one day after President Bush proposed an emergency aid package for people laid off after the attacks, many in the aviation and related industries.
The aid package would extend by 13 weeks unemployment compensation for people who became unemployed after Sept. 11 and in states where the state's total unemployment rate increases by 30 percent over pre-attack levels. The program, paid for with federal dollars, remains in effect for 18 months. It also provided $3 billion in health coverage assistance and income supplements.
The package provides $3 billion in national emergency grants for states experiencing plant closing and mass layoffs. The grants would be used for job training, re-employment services, childcare and transportation for people making the transition back to work. It would also be used to help workers who have medical plans maintain their health insurance benefits.
And the aid package would also provide $11 billion to the states for health insurance for low-income workers. That would include expansion of coverage of children under the State Children's Health Insurance Program, in addition to the $3.1 billion in SCHIP appropriations for fiscal year 2002. Bush said tax cuts and child tax credits would also remain in effect in 2002.
Labor unions had criticized the Bush administration for considering a lucrative $15 billion airline bailout plan without including the more than 100,000 aviation and related industry workers that had been laid off or fired after the attacks.
In an effort to shore up the slowing economy that Bush said suffered a "shock" as a result of the attacks, he has backed a recommendation by Treasury Secretary Paul O'Neill for a stimulus package of between $60 billion and $75 billion. Congressional Democrats said they have been discussing a package in the "$50-billion range." Both sides agree that while a more lucrative package could be necessary since the country is in a state of emergency, it will be important for lawmakers to be conservative in their spending.
McClellan said the president had no concrete timetable for an agreement on the stimulus package, but that he wanted it "as soon as possible."
Still both Democrats and Republicans agree that an economic stimulus package could ultimately place the country back into a federal budget deficit after years of an expansive surplus that had been the center of debate prior to the attacks.
Senate Minority Leader Trent Lott, R-Miss., emerged from the White House on Thursday saying that it might not be possible to come up with a stimulus package that does not place the country in debt.
"But these are unusual times that require unusual actions. We should be careful how we act. We should not loose the dogs of deficit spending," Lott said. "We may decide we may not want to go that size. I think we're still talking parameters."
