U.S. Sept job losses steepest in 5-1/2 years

U.S. employers cut payrolls at the steepest rate in 5-1/2 years during September, slashing an unexpectedly large 159,000 nonfarm jobs as employment contracted for a ninth straight month.

The unemployment rate was unchanged from August at 6.1 percent.

September's job losses were more severe than predicted by Wall Street economists surveyed by Reuters, who had forecast 100,000 jobs would be cut.

The report likely will ratchet up pressure on members of the U.S. House of Representatives to vote for a $700-billion rescue package for banks and other financial firms burdened by bad mortgage-related assets, which is contributing to a spreading credit crunch.

September's cuts follow revised losses of 73,000 jobs in August and 67,000 in July and show the decline in employment is accelerating. Some 51,000 manufacturing jobs were lost last month on top of 56,000 cut in August, the 27th straight month in which manufacturers slashed their payrolls.

The average work week in manufacturing industries was the lowest in three years at 40.7 hours.

Department officials said Hurricane Ike, which hit the Gulf coast, and a strike at aircraft maker Boeing Co. did not affect the data.