Unemployment jumped from 6.5 percent to 6.7 percent, the U.S. Labor Department reported.

"Today's job data reflects the fact that our economy is in a recession," Bush said. "This is in large part because of severe problems in our housing, credit and financial markets, which have resulted in significant job losses."

Government officials are working on the causes of the downturn "to return our economy to health," Bush said.

The frozen credit market is showing signs of thawing, but "there's still more work to do," he said.

The housing slowdown is another cause of the downturn, he said, noting that federal officials will continue to develop programs "that will avoid preventable foreclosures and speed a return to a healthy housing market."

Bush also expressed concern about the viability of the U.S. auto industry, which was testifying before a House committee when the president commented on the economy.

The administration favors tapping into already approved funds designated to help automakers "so long as the companies make hard choices on all aspects of their business to prove that they can not only survive, but thrive," Bush said.

The president said his administration is committed to ensuring the U.S. economy succeeds "and I know the incoming administration shares the same commitment."