November 8, 2003	Saturday	Ramazan 12, 1424

WASHINGTON, Nov 7: The US labour market crunch crumbled in October as the surging economy churned out 126,000 jobs — twice as many as had been expected — and the unemployment rate fell to 6.0 per cent, the government said on Friday.

It was the clearest sign yet that the years of lengthening jobless queues may be over, as businesses get caught up in an economy which soared to a 19-year record growth rate of 7.2 per cent in the third quarter.

“We had been expecting at some stage to see some decent pickup in job creation and now we are finally starting to see it,” said BMO Financial Group senior economist Rick Egelton.

“The real mystery was how was the economy growing so quickly while jobs were continuing to decline.”

Firms also took on 125,000 workers in September, far more than first estimated, bringing the total for the past two months to more than quarter of a million, the Labour Department said.

The unemployment rate in Sept was 6.1pc. Employers appeared to have squeezed the last drop out of existing workers, pushing up productivity, or output per hour, to an 18-month record pace of 8.1pc in the third quarter.

Now, earlier than predicted by economists, rising demand was forcing companies — who had axed about 2.8 million jobs since 2001 — to accept new workers.

President George W. Bush’s administration has taken credit for fuelling the third quarter economic growth spurt with a “Jobs and Growth Act” — a 350-billion-dollar tax cut package that fattened people’s wallets.

But work opportunities expanded in every other major sector of the US economy.

Builders, helped by the searing housing market, which benefitted from the extended period of super-low interest rates, hired 6,000 people.

The education and health industry hired an extra 56,000, professional and business services took on 43,000, retailers took on 30,000, the leisure and hospitality industry hired 23,000 and government took on 10,000.

In October, the vast services sector gained speed in its seventh straight month of expansion and factories grew for the fourth month in a row, according to industry surveys by the Institute for Supply Management.—AFP