Companies report serious case of blues
Job seekers look at a job board at a career center in Oakland, Calif.
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KAI RYSSDAL: If we could flip back the calendar a couple of months, this recession would look pretty different than it does right now. We got by for a year or so thinking the economic distress was limited to housing and, more recently, big banks. The news today wipes that theory clear off the map and leaves no doubt that bad mortgages have caused problems in just about every corner of the U.S. economy.
Marketplace's John Dimsdale reports earnings reports today from the bluest of the blue chips -- supposedly stable, reliable, rock solid companies -- are showing the effects.
JOHN DIMSDALE: Applications for government jobless benefits surged in today's weekly report -- to levels not seen since the early 1980s. Microsoft will be adding to the unemployment lines, announcing 5,000 layoffs today. Chipmaker Intel said it will close factories and get rid of more workers. And Sony reported its first annual loss in 14 years. The Japanese electronics maker is in the process of cutting 16,000 jobs.
JACK ALBERTINE: This unemployment is very egalitarian.
Economic forecaster Jack Albertine says highly educated workers used to be recession-proof.
ALBERTINE: In this recession we're seeing, of course, unskilled workers being laid off, but we're also seeing hot-shot MBAs from Harvard and Princeton and Yale -- all through the financial sector and in the high-tech sector -- laid off.
Big, stable technology companies are being hit harder in this economy than they were when the high-tech bubble burst nine years ago, says S&P Chief Economist David Wyss.
DAVID WYSS: As you get mature, your growth isn't as good. It's a little harder to shrug off a weak economy. Plus, let's face it, this is a much weaker economy than we were looking at in 2001 -- 2001 was barely a recession. This one could be the worst recession since the '30s.
Wyss says it's hard to gain a toehold when consumer spending is falling off a cliff. The big blue chip company, General Electric, reports earnings tomorrow. Analysts fear any profit will be due to tax write-offs rather than real growth.
In Washington, I'm John Dimsdale for Marketplace.