American job losses plunge to worst in 34 years as 598,000 people are laid off in ONE month

America hurtled deeper into recession tonight after jobless figures slumped to their worst in 34 years.

• The bleak unemployment figures dramatically raised the stakes for President Obama as he desperately tried to rally support for his massive economic recovery plan.
• Struggling US employers slashed 598,000 jobs in January as the national unemployment rate rocketed to 7.6 per cent.
• Tonight, the brinkmanship on Capitol Hill is continuing with the White House warning Republicans opposing the president’s rescue plan that a failure to act swiftly could be disastrous.
• President Barack Obama said the job losses in January were ‘devastating news’ and underscored the need for immediate action to revive the economy.   
• ‘It is inexcusable and irresponsible to get bogged down in distraction and delay while millions of Americans are being put out of work,’ Obama said in prepared remarks for an event to announce an economic advisory panel.
• ‘It is time for Congress to act. It is time to pass an Economic Recovery and Reinvestment Plan to get our economy moving again,’ he said.
• Today he also announced members of a team of advisers meant to be an economic sounding board that reports to him directly.
• Obama planned to use the Economic Recovery Advisory Board announcement as a way to address the millions of out-of-work Americans.
• He has already tapped Paul Volcker, a former Federal Reserve chairman and a top Obama adviser, as the leader of his high-profile panel.
• Its mission will include responding to requests from Obama – such as delving into a particular subject – without competing with the National Economic Council government agency or day-to-day decision-making at the White House.
• Obama, who is increasingly losing patience with critics blocking the passage of the bill in the US Senate.
• He spelled out the danger of further bureaucratic delays. ‘An economy that is already in crisis will be faced with catastrophe,’ he added.
• The worse than expected jobless tally reinforced the need for ‘bold fiscal action,’ said Christina Romer, head of the president’s Council of Economic Advisors.
• ‘If we fail to act, we are likely to lose millions more jobs and the unemployment rate could reach double digits,’ she warned.
• More than three-and-a-half million jobs have been lost in the U.S. since the recession began a little over a year ago, with half of those disappearing in the past three months.
• Ironically, Wall Street was showing a triple digit rise in afternoon trading.
• Analysts said investors were relieved the jobless figures weren’t even more dismal.
• Nevertheless, the economy’s rapid deterioration is the biggest stick Mr Obama has in his arsenal to push his stimulus package through Congress.
• The president’s personal and political prestige are on the line because he has reached out to reluctant Republicans and appealed for bipartisan support to tackle the crisis.
• Last week, his bill was approved by the lower House of Representatives but without the backing of a single Republican.
• So far, he has also been rebuffed by opposition lawmakers in the Senate, where the passage of the bill is not guaranteed.
• If the vote runs along strict party lines, the Democrats may not get the 60 seat majority they need in the 100-member Senate to avoid a filibuster, which is a parliamentary tactic to indefinitely delay the debate.
• It hasn’t helped Obama that the cost of his proposed bill to taxpayers has grown by nearly £68 billion since reaching the Senate to a staggering £637 billion.
• The president claims that by plowing huge amounts of cash into public spending projects like building roads and bridges, providing new power lines and modernising schools and hospitals he will help kick-start the nation’s paralysed financial system.
• But Senate Republican leader Mitch McConnell said tonight that the ‘aimless spending spree’ being forced through Congress was a ‘Trojan horse’ containing costly clauses that will do nothing to promote job growth.
• ‘The more that Americans hear about this bill, the less they like about it,’ he said, labelling the president’s plan a ‘trillion dollar mistake.’
• Republican Senator Lindsey Graham was even more blunt.’This bill stinks,’ he said.
• Senate leaders postponed a planned vote on Thursday night to try and come up with a compromise to cut the cost of the bill and offer some additional tax cuts that Republicans were demanding.
• Democrat leader Harry Reid claimed tonight that ‘some progress’ had been made to strike a deal with Republicans.
• Last month’s job reductions in the US were the largest since 602,000 were thrown out of work in December, 1974, while the unemployment rate reached its worst level in more than 16 months.
• The manufacturing sector bled jobs at the sharpest rate during January in more than 26 years, shedding 207,000 workers. Construction industries dropped 110,000 jobs and retail firms cut 45,000 people last month.