Editor's Note: This article continues our series excerpted from AC360°'s contributor David Gewirtz's upcoming book, How To Save Jobs, which will be available in December. Over the next few months, we'll be excerpting the first section of the book, which answers the question, "How did we get here?" Last time, we looked at outsourcing the American dream. This time, we look at something rarely discussed: the national security risks offshoring creates. To learn more about the book, follow David on Twitter @DavidGewirtz.

David Gewirtz | BIO
AC360° Contributor
Editor-in-Chief, ZATZ Publishing

What's particularly disturbing in a post-9/11 America supposedly more aware of national security issues is just how much confidential American data is finding its way into the hands of foreign nationals.

According to the same U.S. Trade Commission report described last week, "Some of the earliest U.S. services outsourced to India included medical transcription services, payroll accounting, credit card call collections, mortgage and insurance claim processing, and data processing."

That means individuals and companies in foreign countries have access to our credit card records and much of our personal identity information, our confidential medical records, and even detailed information about our homes. According to a study by McKinsey Global, nearly 45 percent of the Indian business process outsourcing market consists of financial work, administration work, and payment processing activities.

In a world where identity theft is a huge problem, giving foreign nationals access to our most confidential private information is a dangerous security risk. Consider this: the countries most likely to engage in cyber-espionage with the United States are also the countries with lower-wage employees - places where we're actively sending our most confidential data.

We're also outsourcing our intellectual property and our most valuable trade secret data

Our top technology companies - IBM, Microsoft, and Oracle - are also among the most active in both bringing in foreign technology workers and in outsourcing technology work to foreign nations.

Consider that a typical American computer programmer can demand a salary from $60,000 to $90,000 (and often a lot more). In India, an equivalent job pays from $6,000 to $10,000 per year. Forrester estimates 472,632 software development jobs will be outsourced to India by 2015.

The impact of this is not just lost jobs. You're looking at nearly half a million people outside the United States who will have access to the source code that runs our computers, our systems, and our lives. Instead of Americans having access to the confidential crown jewels of modern technology, it'll be technology experts with loyalty to another nation.

There's also a huge cadre of foreigners in the United States with access to top-secret and sensitive information. Our technology universities often hire professors and graduate students who are foreign nationals. Those same universities often do research projects for both the American military and America's leading industrial firms. Who, exactly, do you think is doing the work? It's not just Americans.

In fact, there are thousands of foreign nationals working on sensitive projects in the United States. But where does their loyalty lie? To the U.S., or to their home country, where their families are often waiting for them to return?

Beyond security concerns, this drain of tech work to foreigners directly impacts American competitiveness. We have long relied on our ability to out-engineer other nations. But if the design and innovation jobs are outsourced, there will be far less reason for students in America to learn these skills and far less Americans providing the creative juice that has long fueled American economic growth.

Make no mistake: each and every one of us is competing with people across the world for our jobs and our income. You may not be a programmer trying to explain why you should be paid $120,000 (or even $60,000) when an equally competent Indian is willing to work for $6,000, but nearly everyone in America will feel the impact as spending power moves offshore.

After all, if a U.S. programmer is out of work, he's not going to buy all the stuff middle-class Americans buy. And, given that his Indian counterpart makes 10 percent of what the American would make, the overseas software developer is also not going to be able to make all the discretionary purchases that the American would have made. Each U.S. job shifted overseas has a ripple effect on America's overall economy.

And there's a lot of people available to do those jobs. Billions, in fact...

Follow David on Twitter at http://www.Twitter.com/DavidGewirtz.

Editor’s note: David Gewirtz is Editor-in-Chief, ZATZ Magazines, including OutlookPower Magazine. He is a leading Presidential scholar specializing in White House email. He is a member of FBI InfraGard, the Cyberterrorism Advisor for the International Association for Counterterrorism & Security Professionals, a columnist for The Journal of Counterterrorism and Homeland Security, and has been a guest commentator for the Nieman Watchdog of the Nieman Foundation for Journalism at Harvard University. He is a faculty member at the University of California, Berkeley extension, a recipient of the Sigma Xi Research Award in Engineering and was a candidate for the 2008 Pulitzer Prize in Letters.

Rising job losses are sparking widespread anxiety.

Gloria Borger
CNN Senior Political Analyst

If you're a Democratic political adviser right now, you've got one major question heading into the 2010 midterm elections: Do voters worry more about the skyrocketing deficit or high unemployment?

The answer: unemployment.

In fact, according to a recent survey done by Democracy Corps, a Democratic research firm, Americans worry twice as much about jobs as the deficit: "...When forced to choose, voters embrace a bold jobs initiative over a long-term deficit reduction program by two-to-one."

Ipso facto, a new jobs bill is born.

Never mind that the first stimulus package has yet to truly kick in. Or that, within the next month, the Senate has to hold its nose and vote to raise the federal debt limit above its current $13 trillion level. That's a tough vote, even for big spenders.

 Keep Reading...

Amy M. Wilkinson
Special to CNN

It's the oldest trick in the political playbook: Call together a "summit" of fancy people so you'll appear to be focused on work that must get done.

Thursday, the White House convened CEOs from companies such as Boeing, AT&T, Comcast and Dow Corning, top leaders of the United Steelworkers, United Food and Commercial Workers, American Federation of Teachers unions, Ivy League academics and a few small-business representatives to brainstorm how the country might generate much-needed jobs.

A schmooze-fest is nice, but the hard work of putting America back to work will be done by entrepreneurs, not the leaders of the biggest companies in the nation and the heads of big unions.

The mom-and-pop shops, garage start-ups and small businesses across the country will put Americans back on the payroll. According to the Census Bureau, nearly all net job creation in the U.S. since 1980 has been generated by firms operating less than five years.

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Chris Isidore
CNNMoney.com senior writer

The long-suffering U.S. jobs market improved significantly in November, as employers trimmed the fewest jobs of any month since the start of the recession, and the unemployment rate posted the biggest one-month decline in more than three years.

U.S. payrolls slipped 11,000 jobs in the month, far below any of the job losses posted over the last 23 months. Economists surveyed by Briefing.com had forecast a loss of 125,000 jobs in November.

The October and September job loss estimates were also revised sharply lower, trimming previous job loss estimates by 159,000 between them.

The new reading put October job losses at 111,000 jobs, and September's loss estimate was cut to 139,000. Each of those new estimates would have been the smallest declines in more than a year.

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CNN

Americans everywhere are feeling the recession's pain – some more than others. Go here to discover the unemployement rate, state by state.

Tom Foreman | BIO
AC360° Correspondent

So many different numbers are being tossed about on the subject of unemployment; if you spend even a day trying to sort them out you can wind up feeling like Alice in Wonderland; only this time she’s tumbled down into an unemployment line where nothing makes sense.

Here is the White House crew talking about all the jobs that they’ve “created or saved” with the stimulus. The economy is getting better, but joblessness is getting worse. Initial benefits claims are up, then they are down. The Labor Department is issuing a river of reports on jobs lost, gained, outsourced, insourced, retro-fitted, repainted, fertilized, pruned, poached in a white wine sauce, you name it. Cue the Mad Hatter. It’s no wonder whacky tea parties are breaking out across the land.

Take it easy. Having traveled at great peril through the looking glass into the surreal land of economists, I have emerged with the grail; the only number you really need to know.

16 million. Actually it’s a little under that, but let’s not quibble. That’s how many Americans are looking for work. Maybe a few less at this very moment. I met some guys in Albany who usually go fishing over the weekend, but you can bet even they will be back in the hunt for work on Monday, so my point stands.

16 million. If we asked them all to join hands and stand along the borders, (hey, what else do they have to do?) they could easily encircle the entire Lower 48 states. We’d probably even have enough left over to put them two deep on the Mexican line, and end that whole debate about building a wall. Actually, this might be a good idea overall; a visual representation of our troubles. We could let them charge for access to the beaches. Or we could pay all of them from the stimulus money! Kind of like publicly funded performance art. I mean, they need the jobs anyway, right?

16 million. It’s one of those whopping numbers that’s hard to get your head around. But in a relative sense, it is a good tool for keeping track of our job troubles. If that number gets smaller, that’s good. And if it gets bigger, well, even the Cheshire Cat won’t be grinning anymore.

Follow Tom on Twitter @tomforemancnn.

Andrew Torgan
CNN Financial News Producer

The nation's unemployment rate rose above 10% for the first time since 1983 in October, a much worse jump than expected as employers continued to trim jobs from payrolls.

The reading is a sign of the continued weakness in the labor market - even though the economy grew in the third quarter following the longest and deepest downturn since the Great Depression.

The Labor Dept. said this morning that unemployment rate spiked to 10.2% last month, up from 9.8% in September. That’s the highest rate since April 1983.

There was also a net loss of 190,000 jobs in October. And while that’s worse than what economists were expecting and is still a big number – it is an improvement from the 741,000 jobs we lost in January.

The largest losses last month were in the construction, manufacturing and retail sectors.

The jump in the unemployment rate was driven up by a large drop in the number of people who describe themselves as self-employed, as well as the number of teenagers who have jobs. The unemployment rate for teenagers in the labor force soared to 27.6%, up 1.8 percentage points and hitting a third-straight record high.

It’s with that employment report as a backdrop that President Obama signed into law a bill to provide up to 20 additional weeks of jobless benefits to unemployed Americans, as well as extend the $8,000 tax credit for new homebuyers into the middle of next year.

After calling the jobless rate “sobering,” Obama said the bill he signed “will help grow our economy, help create and save jobs, and help provide necessary relief to small businesses,” in a statement following the signing.

The House approved the measures by a 403-12 vote Thursday afternoon, a day after the Senate passed the legislation.

The closely watched legislation will extend jobless benefits in all states by 14 weeks. Those that live in states with unemployment greater than 8.5% will receive an additional six weeks. The proposal will be funded by extending a longstanding federal unemployment tax on employers through June 30, 2011.

The Senate had been bickering over the details since September, and that cost more than 200,000 people their benefits. Some 7,000 unemployed Americans run out of benefits each day, according to the National Employment Law Project.

Commodities prices also reacted to the unexpected spike in the unemployment rate.

Crude oil prices dropped by more than $2 to around $77 per barrel. Oil prices have risen from a low of less than $33 a barrel last December to a high for this year of $82 in October.

And gold powered through the $1,100 an ounce barrier as nervous investors sought out the metal as a safe haven.

Gold prices have soared 5% this week amid speculation that overseas central banks may be moving toward buying more gold as they look for ways to reduce their exposure to the U.S. dollar - the traditional reserve currency of choice for many of those foreign central banks.
Follow the money… on Twitter: @AndrewTorganCNN

Chris Isidore
CNNMoney.com Senior Writer

The nation's unemployment rate rose above 10% for the first time since 1983 in October, a much worse jump than expected as employers continued to trim jobs from payrolls.

The reading, reported by the government Friday, is a sign of the continued weakness in the labor market even though the economy grew in the third quarter following the longest and deepest downturn since the Great Depression.

The government reported that the unemployment rate spiked to 10.2%, up from 9.8% in September. It is the highest that this rate has been since April 1983. Economists had forecast an increase to 9.9%.

There was also a net loss of 190,000 jobs in October, according to the Labor Department, an improvement from a revised estimate of 219,000 job losses in September. However, economists surveyed by Briefing.com had forecast a loss of only 175,000 jobs in October. This was the 22nd straight month of job losses.

Keep Reading...

CNNMoney

The Obama administration says the Recovery Act created or saved 640,000 jobs through September but the unemployment rate is still very high through out the nation. View a state-by-state breakdown.

Editor's Note: This article continues our series excerpted from AC360°'s contributor David Gewirtz's upcoming book, How To Save Jobs, which will be available in December. Over the next few months, we'll be excerpting the first section of the book, which answers the question, "How did we get here?". Last week, we discussed A short history of jobs This time, we'll look at riots, massacres and the transactional nature of work. To learn more about the book, you should follow David on Twitter @DavidGewirtz.

Protesters in the United Kingdom gathered outside an oil refinery this summer, after hundreds of striking workers were laid off.

David Gewirtz | BIO
AC360° Contributor
Editor-in-Chief, ZATZ Publishing

In today's civilization, it's virtually impossible to survive without money. One-hundred-and-fifty centuries ago, if a Natufian wanted to build a hut, he'd find an empty spot of land and dig. But, today, if an American wants to build a house (or even a hut), land has to be bought. If you want to live inside a structure, a transaction of some sort has to take place and that requires money.

It is the transactional nature of a job that creates its complexity in terms of the rest of society. If you want to work for someone else (and have them pay you), you have to convince them that employing you will meet their needs. If you're self-employed, you have to convince prospective clients and customers that hiring you will meet their needs.

In other words, getting a job or getting a gig requires some level of marketing to make someone aware you're there to do the job and some level of sales to convince them you're the right person for the job.

Over the centuries, the nature of work evolved to eventually result in the world of employment we've all come to know and love. There's now always someone buying work and someone else selling it.

The transactional nature of work has also led to all sorts of power imbalances. When there's too much work and not enough workers, it's a seller's market and the workers have more power over what jobs they accept and at what pay level.

When there's not enough work to go around, we have a buyer's market and then the employers can set the terms, confident that if one worker won't accept the pay or conditions, some other worker will.

This power imbalance has led to some seriously bad situations.

The 1999 massacre at Columbine High School wasn't the first Columbine massacre. Back in 1927, in a town with the sadly ill-suited name of Serene, Colorado, miners at the Columbine Mine went on strike. More than 500 miners had brought their families to the mine as part of their strike demonstration.

Members of the newly-created Colorado state police, dressed in civilian clothes, blocked the miners' path to the mine. A fight broke out, machine guns were fired into the crowd of demonstrators, and five of the striking workers were killed.

On May 26, 1937, members of the United Auto Workers planned a demonstration at the Ford River Rouge car plant. The union wanted workers to make $8 for a six-hour work day, instead of the $6 for the eight-hour day they were then working. Adjusted for today's money, workers were making about $11.25 an hour and the union wanted wages raised to the 1937 equivalent of today's $20 per hour.

Timed for a shift change with 9,000 workers cycling through the plant, union organizers planned a photo-op. Two of the organizers posed in front of a Ford sign for Detroit News photographer James E. Kilpatrick. Reports claim that as many as 40 members of Ford's security force came down on the workers, leaving the demonstrators battered and bruised, and at least one demonstrator was left with a broken back as a result of the beating.

These are just two examples of protests and fights that have taken place between employees and employers. American history is filled with stories of labor riots, like the Haymarket Affair that took place in Chicago's Haymarket Square in 1886. A bomb was thrown at police, eight police officers died, eight protesters were charged with murder, four were put to death, and one committed suicide while serving time in prison.

Stay tuned. Next up, we'll look at our changing relationship with work.

Follow David on Twitter at http://www.Twitter.com/DavidGewirtz.

Editor’s note: David Gewirtz is Editor-in-Chief, ZATZ Magazines, including OutlookPower Magazine. He is a leading Presidential scholar specializing in White House email. He is a member of FBI InfraGard, the Cyberterrorism Advisor for the International Association for Counterterrorism & Security Professionals, a columnist for The Journal of Counterterrorism and Homeland Security, and has been a guest commentator for the Nieman Watchdog of the Nieman Foundation for Journalism at Harvard University. He is a faculty member at the University of California, Berkeley extension, a recipient of the Sigma Xi Research Award in Engineering and was a candidate for the 2008 Pulitzer Prize in Letters.

Even if the stock market broke the 10,000 point barrier a few weeks ago, many Americans can't see what all the enthusiasm is about.

Julian E. Zelizer
CNN

When the stock market broke the 10,000 point barrier a few weeks ago, many investors celebrated. Economists have started to talk about the end of the "Great Recession." But many Americans can't see what all the enthusiasm is about.

National unemployment rates remain extraordinarily high, having reached almost 10 percent. According to the Congressional Budget Office, unemployment will climb to 10.2 percent in 2010 before falling to around 9.1 percent the following year.

Within particular states, the situation is dire. In Massachusetts, unemployment rates have reached a level not seen since 1976. Michigan's unemployment rate is at a little over 15 percent. State budgets, according to a report by the Rockefeller Institute of Government, are still devastated by rapidly declining tax revenue. According to its study, collections by states fell by 16.6 percent from April to June.

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President Barack Obama signs the Lily Ledbetter Fair Pay Act earlier this year.

Dana Goldstein
The Daily Beast

It was sold as the silver lining of the recession: With the national unemployment rate inching toward 10 percent—and the bloodletting especially severe in testosterone-fueled industries like finance and manufacturing—women were supposedly doing dandy. Federal stimulus dollars protected typically female jobs in nursing and teaching. The New York Times trumpeted that laid-off dads were picking up more chores around the house while “opt-out” moms headed back to the office, saving their families from financial destitution. For the first time in American history, women accounted for 49 percent of the labor force. Within the next few weeks, it is likely that more than half of all workers will have two X chromosomes, a milestone that would have been unimaginable to previous generations.

It’s true that men account for four-fifths of all layoffs since the downturn began nearly two years ago. But scratch the statistical surface and you’ll find that American women are hardly sailing through the economic storm. A new report by California's first lady, Maria Shriver, and the Washington-based Center for American Progress contains some encouraging news on shifting attitudes about gender. It finds that both men and women are enthusiastic about increased gender diversity in the workplace, and men are taking on more responsibility at home. But it also finds that most American women remain mired in unstable jobs with few employee benefits.

Read More...

Tom Foreman | BIO
AC360° Correspondent

During the second George Bush presidency, when the economy started its long trip over the falls in a barrel, there was a joke: “The President says he’s creating jobs and I know it must be true. I’ve got three of them!”

I don’t know who came up with that one, but it could have been any of the millions of people who were underemployed. Underemployment is the evil twin of unemployment. Many of the underemployed have jobs, but often for far fewer hours a week than they might want or at much lower skill and pay levels than they have earned. We’ve all heard the chilling, albeit apocryphal, tales of accountants waiting tables, and doctors driving cabs. (Although trust me, the cabbie I had last week was no brain surgeon.) People who have given up looking for work also swell the ranks of the underemployed.

And the underemployment rate is staggering: 17 percent last month. It has soared like an Iranian test missile over the past two years, and is now much worse than it was the last time the economy tanked. The insidious effects are touching virtually every sector of the economy in ways that can sometimes be even worse than straight joblessness.

Losing your house is awful, but psychologically it maybe even harder to take when you are working as hard as you can at several different jobs and still not covering the bills. The underemployed worker can spend so much time chasing the meager dollars that are available, that he or she may have little time, energy, or opportunity left for pursuing more substantial work. Many of the underemployed, almost by definition, certainly are less likely to have health insurance or other benefits.

Businesses lose too. Underemployment means less productivity, and the American market being deprived of the best skills available. After all, who benefits from a computer programmer bagging groceries? Last year on the radio show, Marketplace, a respected economic analyst said of underemployment, “It has gone up considerably faster than unemployment and that’s partially because when this recession got started, employers didn’t necessarily lay off people as much as they cut their hours.” That was Jared Bernstein, and he’s now a top economic policy advisor in the Obama White House.

Many economists have suggested underemployment is more damaging to prospects for recovery than unemployment; in part because underemployment allows businesses to limp along, neither growing and creating sustainable work, nor failing and making way for other businesses that might be more robust.

So despite claims of progress by the White House, many Americans can still tell that old joke with a sneer: “Is the President creating jobs? Sure, I’ve got three of them.”

Follow Tom on Twitter @tomforemancnn.

Editor's Note: This article begins our new series excerpted from AC360°'s contributor David Gewirtz's upcoming book, How To Save Jobs, which will be available in October. Over the next few months, we'll be excerpting the first section of the book, which answers the question, "How did we get here?". The second section consists of recommendations about what we need to do as a country to save jobs. The third, final section is a series of hands-on tips and techniques, things real people and real companies can do right now to help keep and create jobs - without waiting for anyone in Washington to get it right. To learn more about the book, follow David on Twitter @DavidGewirtz.

David Gewirtz | BIO
AC360° Contributor
Editor-in-Chief, ZATZ Publishing

Job. Such a simple word has such a profound meaning for everyone in our society. Three simple letters reflect where we spend much of our time as adults, how well we can support ourselves and our families, and even our standing in our communities.

When we're making a living, or having an occupation, a trade, a career, a profession, a calling, a vocation, and a livelihood, we're also talking about jobs. But what exactly is a job? Why do jobs exist? How are they created? How are they lost? And, most importantly, how can we save them?

You need to understand why a job exists.

Let's talk for a minute about what, exactly, a job is. Fundamentally, a job is a trade of time, skill, and spirit for something of value, usually money. You and I put in a good work week and we expect to get paid.

But who pays for the jobs? To answer that question (and it's a very important question), you need to understand why a job exists. At its root, a job exists because somebody needs something done and either can't, or won't - or doesn't want to - do it himself.

Sometimes, we rent that skill. For example, when you go to see a doctor, you're renting a portion of her time, in return for her wisdom, experience, and skill. Many people who freelance or who perform trade work (plumbers, electricians, carpenters, etc.,) often also rent their skill like doctors – a few hours at a time to each client or customer.

If you're a freelancer or a sole proprietor, you not only have to do a good job, you need to create your jobs, get your gigs, and run your own business. This information might help you, because it will help make your business more successful. It might even help you reach the point where you're creating additional jobs.

The more traditional job exists because a company hires an employee. The company needs work done, and the employee agrees to do the work in return for a paycheck - and those all-important benefits.

What's your occupation? How are you occupied? Do you work for someone else, have them tell you what to do and how to spend your time, in return for money and benefits? Many jobs are great and people love them. But many other people hate their jobs, staying simply because the job market is so soft or because they're trapped by a benefits package.

Your company does not exist to create jobs. Jobs are the by-product of enterprise.

When I first left engineering school more than a quarter of a century ago and entered the labor force as a newly-minted computer scientist, I didn't really understand what made my job possible and, honestly, as long as I got paid and the work didn't suck too much, I certainly didn't care why my job existed.

Many employees don't think very far beyond that basic transaction of time for work (and health insurance). Oh, at a very general level they understand the company needs to be making money, but the details of that process often seem very far removed from the tasks done each day.

Things become more tangible during down markets. It's at this time that layoffs happen. A company usually reduces its headcount because it's not making enough money or is somehow not successful enough to keep everyone employed. A company reduces headcount because something's not working right.

Sometimes, the company hired people it shouldn't have and layoffs are a correction. Sometimes, the company uses a down economy as an excuse to get rid of poor performers and those with bad attitudes. And sometimes, the company simply can't afford to make its payroll.

In all these cases, it's the business climate that informs the company's employment strategy. Clearly, the better the company is doing, the more likely it is to keep its employees - and perhaps even hire more.

A job, fundamentally, is a way of supporting oneself and his or her family. It doesn't necessarily mean going to a place of work and having a boss. Your job could involve freelancing or building your own business.

My job is like that. I last had an official, go-to-work boss all the way back in 1986. That means I've been making my own living by creating products and services, writing and publishing, and helping other businesses succeed for almost 25 years.

But while a job, in the eyes of most employees, is a way of supporting themselves, companies do not exist to create jobs. Jobs are not the purpose of enterprise. Jobs are the by-product of enterprise. This is a very important concept and is absolutely fundamental to the mission of saving jobs.

A company is not successful because it has created jobs. A company creates jobs because it has some level of success. The more successful a company is, the more jobs it creates to support that success.

It stands to reason, then, that if we want more jobs and we want to save the jobs we have, our companies need to be more successful. The answer to the question of "How do we save jobs?" is this: create more successful and sustainable companies.

Later in thisseries, I'll tell you how to do just that. I'll help you understand some tactics and strategies for making sure your business is more successful, and help you understand how you can thrive in times of challenge and times of change.

Follow David on Twitter at http://www.Twitter.com/DavidGewirtz.

Editor’s note: David Gewirtz is Editor-in-Chief, ZATZ Magazines, including OutlookPower Magazine. He is a leading Presidential scholar specializing in White House email. He is a member of FBI InfraGard, the Cyberterrorism Advisor for the International Association for Counterterrorism & Security Professionals, a columnist for The Journal of Counterterrorism and Homeland Security, and has been a guest commentator for the Nieman Watchdog of the Nieman Foundation for Journalism at Harvard University. He is a faculty member at the University of California, Berkeley extension, a recipient of the Sigma Xi Research Award in Engineering and was a candidate for the 2008 Pulitzer Prize in Letters.

Andrew Torgan
CNN Financial News Producer

The first of this week’s big employment reports is out and the numbers are a bit of a disappointment.

Payroll-processing firm ADP says private-sector employers cut 254,000 jobs in September, down from a revised 277,000 in August. But that is the smallest monthly total since July 2008, even though it’s worse than the 200,000 loss economists had forecast.

Large businesses, those with 500 or more workers, let 61,000 workers go in September. Medium-sized businesses, with between 50 and 499 workers, shed 93,000 jobs. And small businesses, those with less than 50 workers, reduced payrolls by 100,000.

Small businesses held will continue to shed more workers than larger and medium-sized firms, ADP said. That's because large businesses started shrinking payrolls earlier and therefore will recover sooner.

The report is seen as a precursor to Friday's closely-watched monthly jobs report from the Labor Dept.

That report is expected to show that the economy shed 180,000 jobs in September, down from the 216,000 reported for August. Meanwhile, the unemployment rate is predicted to rise to 9.8% from 9.7%.

Fewer metro areas suffer 10% unemployment

Separately, the number of metropolitan areas in the U.S. with jobless rates above 10% decreased in August, according to the latest government figures.

The Labor Dept. says 129 metropolitan areas suffered unemployment rates of at least 10% last month. That was down from 139 metro areas in July.

And the number of urban centers with unemployment rates above 15% fell to 16 from 19 the month before.

El Centro, Calif., had the highest unemployment rate of any metro area at 28.7%. But that was down from 30.5% in July.

The second highest rate was in Yuma, Ariz., where unemployment toped 26.1% in August. Both El Centro and Yuma are urban centers near agricultural areas that experience extreme heat, which impacts the workforce there, the Labor Department said.

Among the metro areas with rates above 15%, seven were in California and four were in Michigan.

Economic growth improves

Gross domestic product - The broadest measure of the nation's economy - declined in the April-June period, but not by as much as previously reported.

The government said its final reading of GDP shrank at a 0.7% annual rate, better than the 1% rate reported last month because business spending in the quarter wasn't as weak as initially thought.

That’s also better than the 1.2% economists were expecting - and is a vast improvement from the first quarter's 6.4% decline.

YouTube credit card rant gets results

Ann Minch, a disgruntled Bank of America customer, says the bank “jacked up” the interest rate on her credit card to 30%.

So she did what any other angry consumer would do in the information age: She posted a video on Youtube.com ranting about the increase and calling Bank of America, “evil, thieving bastards.”

Her rant went viral, and Minch says the bank scaled her rate back to its original 12.99%.

The video, titled "Debtor's Revolt Begins Now!," has been streamed nearly 400,000 times and earned a five-star user rating since it was posted earlier this month.

Toyota recall: 3.8 million cars with risky floor mats

Toyota has issued a safety recall for 3.8 million Lexus and Toyota cars because of potentially deadly floor mats.

In statements released Tuesday, the world's largest automaker and the National Highway Traffic Safety Administration warned drivers to remove the mats or risk a forced-down accelerator pedal that could lead to a fatal crash.

The seven models being recalled could potentially have removable mats that would interfere with the pedal and cause it to stick.

The Toyota models being recalled include the 2007-2010 Camry, 2005-2010 Avalon, 2004-2009 Prius, 2005-2010 Tacoma and 2007-2010 Tundra. The Lexus models facing the safety recall are the 2007-2010 ES 350, and the 2006-2010 IS 250 and IS 350.

Ask the “Oracle”

If you could ask the world’s most famous investor anything, what would it be?

A few weeks ago, Fortune asked CNN’s viewers and Web users to submit their “Ask Warren Buffett” questions to CNNMoney.com.

So what did people want to know? Is China the next bubble? Should the Fed raise interest rates? And does the “Oracle of Omaha” ever get tired of answering all these questions?

Click here for his answers.

Follow the money… on Twitter: @AndrewTorganCNN

Andrew Torgan
CNN Financial News Producer

More than a million people could receive an additional 13 weeks of unemployment benefits under a bill the House is set to take up today.

The measure would extend benefits for those living in states with jobless rates higher than 8.5%. Some 27 states, plus the District of Columbia and Puerto Rico, fall into this category. The national unemployment rate hit 9.7% in August, the highest in 26 years.

The extended benefits would apply to an estimated 314,000 people set to exhaust their benefits by month's end and to more than a million who will stop getting checks by the end of the year.

Fed in Focus

The Federal Reserve begins its two-day policy meeting today.

The central bank is widely expected to keep its key benchmark lending rate unchanged at a target range of zero to 0.25%. And overall, analysts are expecting this to be a fairly uneventful meeting.

In addition to leaving rates where they are, the Fed is not likely to say much about winding down its trillions of dollars in lending and bailout programs. Nevertheless, investors will examine the language of the accompanying statement very closely.

But many Fed-watchers don't expect that statement to be overly enthusiastic - or even say much at all. Ben Bernanke & Co. are likely to be very careful not to disrupt the wave the stock market is riding.

Because the recovery from the recession is so tenuous, most economists think keeping rates steady is the right decision. In addition, inflation isn't currently a worry, and that factors into the Fed's decision as well. Because consumer confidence is so low, concerns about rising prices have been mostly muted.

Massachusetts leads in health care coverage

A new study from the government shows a wide disparity in health care coverage across the United States.

Using data from 2008, the survey from the U.S. Census Bureau showed that at 4.1%, Massachusetts had the lowest level of uninsured people of all 50 states and Washington D.C., while Texas had the highest with 24.1%.

Experts cite a number of factors for the wide range including programs already in place, whether or not illegal immigrants are counted, and wage differences.

Where to find the fattest paychecks

Maryland is the nation's top-earning state for the third year in a row, with a median household income of $70,545 in 2008, according to a U.S. Census Bureau report released this week.

The states with highest median incomes are concentrated in the far West and in the Northeast, around the District of Columbia.

Most of the lowest-earning states are in the South. Mississippi had the lowest median income of just $37,790, while West Virginia ($37,989), Arkansas ($38,815), Kentucky ($41,538), and Alabama ($42,538), round out the bottom five.

The four highest earning states after Maryland are New Jersey, which has a median household income of $70,378, Connecticut ($68,595), Alaska ($68,460) and Hawaii ($67,214).

Follow the money… on Twitter: @AndrewTorganCNN

People seeking employment line up outside a job fair in Baltimore, Maryland.

Gene Bloch
Managing Editor
CNN New York

Five states posted jobless rates above 12% last month, according to the Labor Department. Michigan had the highest unemployment rate – at 15.2%, followed by Nevada at 13.2% and Rhode Island at 12.8%. 27 states and the District of Columbia reported increases, 16 states registered rate decreases, and 7 states had no rate change. The news offers more confirmation that whether or not the recession is over, the jobs picture is still bleak.

http://money.cnn.com/2009/09/18/news/economy/state_unemployment/index.htm?postversion=2009091811

Poppy Harlow in today’s Breakdown takes a look at big bonuses and golden parachutes on Wall Street – a year after the collapse of Lehman Brothers, it’s looking a lot like business as usual. Poppy talked to FDIC Chairman Sheila Bair who says the bonuses seem “absolutely unseemly.” And now a huge crackdown into bank compensation may be in the works. The Wall Street Journal reports this morning that the Federal Reserve is proposing broad oversight of any policies which encourage risk among bank employees. The Fed would have the power to amend or reject the executive compensation policies.

Rising stock prices are helping pushing the net worth of Americans higher. After two years of declines, the net worth of Americans rose by $2 trillion to an estimate $53.1 trillion in the second quarter. In that period, stock holdings rose 22% and home prices edged up 2%. Still, from the pre-recession peak, net worth is down 19%.

http://money.cnn.com/2009/09/17/news/economy/Net_worth_rises/index.htm

Time is fast running out for first-time buyers hoping to get a tax credit of up to $8,000. Now there’s a bill to extend the first-time homebuyers credit. 1.4 million Americans have already claimed the credit. Gerri Willis reports on what impact the tax credit has had on the housing industry, what an extension could do and what the critics are saying.

http://money.cnn.com/2009/09/17/real_estate/homebuyer_tax_credit_claims_soaring/index.htm?postversion=2009091806

Call it “cash for electronic clunkers.” If you have a used Blackberry, digital camera, cell phone, old iPod, you could trade it in for some quick cash. A startup website called Gazelle.com will buy your used electronics and resell them. CNNMoney’s Julianne Pepitone has a terrific story on the site.

http://money.cnn.com/2009/09/18/technology/iPod_electronics_trade_in_recycling_gazelle/index.htm

And for the first time in many weeks, gas prices didn’t move at all.

AAA reports the average price of regular unleaded remained unchanged at $2.55 a gallon.

On CNNMoney today:

* When workers take charge. It's a unique model – the worker-owned business. Some say it sounds like socialism, but these six companies say it's helped them tough out the recession.

http://money.cnn.com/galleries/2009/smallbusiness/0909/gallery.worker_owner_coop.smb/index.html

* Finding health care for a virtual workforce. Small companies have a hard enough time finding affordable health coverage for their workers. When your staff is scattered throughout the U.S., it's even tougher.

http://smallbusiness.blogs.cnnmoney.cnn.com/2009/09/17/finding-health-care-for-a-virtual-workforce/

* High style on a plain prairie: Why a Kansas-born luxury furniture designer set up his manufacturing shop in his home state, far from the cities where his wares sell.

Financier Bernard Madoff is serving a 150-year prison term for defrauding thousands of investors.

Gene Bloch
Managing Editor
CNN New York

How is President Obama’s health care address going over with Americans? Ali Velshi is aboard the CNN Express and will be live at noon in Scranton PA, where the Tea Party Express has a rally scheduled.

Meanwhile, the Census Bureau updated us today on the number of people without health insurance coverage – it stood 46.3 million in 2008, up 600-thousand from the 2007 level – but down from the 47 million reported in 2006. In the same report, the Census announced real median household income fell 3.6 percent to $50,303, and the poverty rate rose by 7-tenths of a percentage point to 13.2.

The jobs picture is still dire, but the latest weekly figures are “moving in the right direction” as economists like to say. The number of people filing first time jobless claims fell by 26-thousand last week to 550-thousand. The number of people continuing to collect unemployment is still above 6-million, but that number fell slightly as well.

Is the stimulus helping create jobs? This afternoon the Obama administration is releasing its first report to Congress about the stimulus, which is formally called the Recovery Act.

The banking bailout also is in the headlines today. Harvard professor Elizabeth Warren, head of the Congressional Oversight Panel, says she wants straight talk from Treasury Secretary Timothy Geithner – who is set to testify before her panel at 1p on Capitol Hill. Where has the money gone? What’s the government’s exit strategy? The panel’s latest report also asks for confidential memorandum from The Treasury Department and the Federal Reserve concerning investments in Bank of America and Citigroup. What is Professor Warren looking for?

When a phone conversation begins “Obviously, first of all, this conversation never took place, OKAY?” – you know that something’s not quite right. In audiotapes released yesterday by the Massachusetts Secretary of State’s office, Ponzi-schemer Bernard Madoff coached colleagues on how to evade questions from Securities and Exchange Commission investigators. "You know, you don't have to be too brilliant with these guys, because you don't have to be.”

At one point, Madoff interrupted the conversation to take another phone call. He returned and said, "I'm sorry. If I get any more solicitations for charity, I'm going to kill myself." The tapes offer a revealing look at the contempt Madoff had for the SEC, which missed years of red flags pointing to his massive fraud. There is also a Senate Banking Committee hearing today at 230p on how the SEC missed the Madoff scandal.

And gas prices are up but only a little. AAA reports a gallon of regular unleaded is averaging $2.576 ($2.58 for graphics purposes), up 3-tenths of a cent and breaking an 8-day streak of declines.

On CNNMoney today:

* The fight over doctor lawsuits. Obama on Wednesday night said he would accept health care reform provisions that reined in medical malpractice lawsuits. Story will look at the issue and the fight.

* Home repossessions: 'In the soup for at least a year.' The number of bank repossessions drops sharply in August, but it may be the calm before the storm.

* 10 a.m.: Census Bureau releases income, poverty and health insurance estimates for 2008

* Fortune's Most Powerful Women in Business – w/galleries, Q&A and video. Most powerful women in United States; most powerful globally. Plus the DC Power List.

Andrew Torgan
CNN Financial News Producer

The battered U.S. job market is showing signs of improvement.

Employers scaled back sharply on layoffs in July, cutting 247,000 jobs. That’s the fewest in nearly a year. The unemployment rate, meanwhile, dipped to 9.4% - its first decline in 15 months.

The numbers suggest a turning point is at hand after job cuts earlier in the year that totaled as much as 700,000. The economy has lost 6.7 million jobs since the recession started in December 2007.

But there was still plenty of bad news to be found.

The number of people unemployed for more than six months continued to rise, reaching nearly 5 million people - a record high. And the average amount of time that an unemployed person has been out of work reached 25.1 weeks, the highest reading in the 61 years that the Labor Department has been keeping records.

‘Clunkers’ gets a lifeline

The Senate voted to pass a $2 billion extension of the popular “Cash for Clunkers” program Thursday evening, as lawmakers rushed to finish business before their August recess.

The House had already voted to extend the program, which blew through its $1 billion in initial funding, before it adjourned for the summer last Friday. President Obama is expected to sign the extension into law later this week.

Under the Clunkers program as enacted, vehicles purchased after July 1 are eligible for refund vouchers worth $3,500 to $4,500 on traded-in gas guzzlers. The trade-in vehicle has to get a combined city and highway fuel economy rating of 18 miles per gallon or less.

According to government figures, compact cars and hybrids have been the top sellers so far.

The top-selling car had been the Ford Focus, but new figures released Wednesday show that the Toyota Corolla captured the top spot.

‘Clunkers’ controversy

Despite the exclusion of large trucks in the government's top-ten “Clunkers” sales list, an independent analysis of sales figures shows two full-size trucks were actually among the top-ten buys. Furthermore, a small crossover SUV, and not a compact car, was the most popular overall.

Analysis by automotive Website Edmunds.com disputes the government's results, which show small cars as the top choice for shoppers looking for “Clunker” deals.

For example, the Ford Escape crossover SUV, instead of being the seventh-most popular vehicle under the program, as the government ranked it, was actually the best seller according to Edmunds.com.

The discrepancy is a result of the methods used. Edmunds.com uses traditional sales measurements, tallying sales by make and model. The government uses a more arcane measurement method that subdivides models according to engine and transmission types, counting them as separate models.

AIG turns a profit

Bailed-out insurance giant AIG reported its first quarterly profit in nearly two years, citing stabilization in its insurance businesses.

The company said its second-quarter net income was $1.8 billion, after six straight losing quarters. A year ago, it lost $5.4 billion.

The last time AIG reported a profit was in the third quarter of 2007, when it earned $3.1 billion. AIG lost $99 billion last year and $4.4 billion in the first quarter of 2009.

And it’s not out of the woods just yet… the company owes U.S. taxpayers $87.6 billion, which it plans to pay down by selling off non-core assets and stakes in three huge subsidiaries.

Fannie Mae asks for another $10 billion

Fannie Mae, the government-controlled mortgage insurer, said Thursday that it needs another $10.7 billion from the Treasury Department to stay afloat.

The new infusion means the troubled company has drawn a total of $45.9 billion of its $200 billion lifeline this year.

Fannie Mae and its sister firm, Freddie Mac, were taken over by the federal government last September amid the global financial meltdown.

Follow the money… on Twitter: @AndrewTorganCNN

Andrew Torgan
CNN Financial News Producer

ExxonMobil posted a 66% decline in second-quarter earnings this morning due to weak energy demand and volatile oil prices.

The world's largest publicly-traded oil company said it earned just under $4 billion in the quarter, down from nearly $12 billion just one a year earlier.

Earnings at Exxon, which reported the largest annual profit in U.S. history last year, have declined this year as oil prices plummeted from 2008's record highs above $147 a barrel.

Oil prices averaged about $60 a barrel in the second quarter of this year, compared with roughly $124 a barrel in the same period in 2008.

Jobless claims increase but trend improves

The number of Americans filing new claims for jobless benefits rose last week, but remains below peak levels reached in the spring.

Initial claims rose by 25,000 to 584,000. But the four-week moving average for new claims, which considered a better gauge of underlying trends as it smoothes out week-to-week volatility, fell by 8,250 to 559,000.

This was the lowest level since late January. The moving average has also declined for five straight weeks.

And the tally of people who continue to get benefits for one week or more fell by 54,000 to 6,197,000 - the lowest level since early April.

Report shows foreclosures may be easing

Sun Belt cities dominated the list of metro areas with the biggest foreclosure problems during the first six months of 2009.

Cities in just four states - California, Florida, Arizona and Nevada - captured 29 of the top 30 places with the highest foreclosure rates, according to a report issued by RealtyTrac. Greeley, CO, was the only outsider, coming in at 29th.

The good news, however, is that some of the worst hit spots - such as the Central Valley cities in California - showed some improvement. Although there is concern that we may just be in a lull before a third wave of foreclosures hits.

It's official: You own a piece of Citigroup

Congratulations! You now own a big chunk of Citigroup.

Although a few housekeeping issues remain, Citigroup effectively completed its long-awaited plan to turn preferred shares owned by the government into common stock on Thursday. That gives U.S. taxpayers a 34% stake in one of the world's largest financial institutions.

But Citi has also earned a reputation as one of the nation's most-troubled financial institutions. From the time the credit markets began to unravel in late 2007 up until the end of last year, the company lost more than $28 billion.

That subsequently led the government to take a $45 billion stake in Citigroup to help stabilize the bank.

Follow the money… on Twitter: @AndrewTorganCNN