By  on December 5, 2008

WASHINGTON — Retailers jettisoned thousands of jobs in November, contributing to a free fall in the nation’s payroll levels and adding fuel to the dark holiday season.

Specialty apparel stores cut 17,600 jobs to employ 1.46 million in November, and department stores shed 3,500 positions to employ 1.47 million, the Labor Department said Friday.

The overall economy lost a staggering 533,000 jobs in November, the worst one-month drop in 34 years and the 11th consecutive monthly decline. The unemployment rate rose to 6.7 percent from 6.5 percent.

For retailers, November is typically a month when staffing levels increase as stores hire extra workers during the crucial holiday period, said Richard Yamarone, chief economist at Argus Research. But the deepening recession and sharp pullback in consumer spending has sidetracked job growth and retail sales. Same-store sales last month fell by double digits across a broad spectrum.

“It’s evident if Santa Claus isn’t coming to town, there’s no need for retail workers,” Yamarone said. “What’s the retail employment situation going to be in January or February, when we traditionally furlough those [seasonal] workers?”

Compared with November 2007, department stores employed 88,000 fewer people last month, and specialty stores dropped 65,000 jobs. Overall, there were 468,000 fewer retail jobs in the overall economy than 12 months ago, said Charles McMillion, president and chief economist at MBG Information Services.

Apparel and textile manufacturers also reported monthly job losses in November. Textile mills that make apparel fabric cut 4,700 positions. Factories producing industrial and home furnishing material, known as textile product mills, eliminated 1,200 spots. Apparel manufacturers reduced payrolls by 1,500 jobs.

Nationally, September and October job losses were revised down, reflecting the loss of an additional 199,000 workers. Updated figures now show there were 320,000 jobs lost in October, revised from initial reports of 240,000. In September, 403,000 positions were eliminated, revised down further from already-adjusted numbers.

The downward revisions included the loss of an additional 16,000 positions at specialty stores in October, McMillion said.

“It was already clear that this would be one of the worst recessions in the post-[World War II] period,” said Nigel Gault, chief U.S. economist at Global Insight. “After today’s horrendous November employment report, it is beginning to look like the worst. The economy is now locked in a vicious downward spiral in which employment, incomes and spending are collapsing together. These are extraordinarily dangerous times, which will almost certainly last at least until 2010.”

Employment levels are the most important determinant of consumer spending, economists said. As jobs disappear, fewer consumers are comfortable making purchases, which doesn’t bode well for the holiday selling period and beyond.

“I don’t think retailers can salvage the holiday season,” Yamarone said.

President-elect Barack Obama continued to push for an economic stimulus package on Friday. He already has sketched the outlines of an economic recovery plan that he says will save or generate at least 2.5 million jobs.

“There are no quick or easy fixes to this crisis, which has been many years in the making, and it’s likely to get worse before it gets better,” Obama said. “But now is the time to respond with urgent resolve to put people back to work and get our economy moving again.”

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