Economy

WASHINGTON — Businesses shed 84,000 jobs in August as the unemployment rate soared to a five-year peak of 6.1%, the Labor Department said Friday in a report providing stark evidence that the economy is foundering. Fully 2.2 million Americans have lost their jobs in the past 12 months, as the unemployment rate has climbed from 4.7%. In another troubling sign, the number of long-term unemployed — those out of work six months or more — jumped by 163,000 to 1.8 million, and has surged by 589,000 in the past 12 months.

NEW YORK (CNNMoney.com) -- A record 1.249 million homes were in foreclosure during the second quarter of 2008, according to a report released Friday by the Mortgage Bankers Association. And new foreclosure proceedings were started on about 490,000 of the 45 million home mortgages serviced by MBA members. That's up 9% from the 448,000 starts recorded in the previous quarter. Mortgage delinquencies continued their grim rise during the three months ended June 30, with 2.9 million homeowners falling behind on their loan payments, apart from those already in foreclosure. Compared with a year ago, delinquencies are up more than 25%, while loans in foreclosure have nearly doubled. Both levels were the highest ever recorded by the survey.

WASHINGTON — The nation struggled with slow economic growth and still-high prices that are weighing on consumers and businesses alike. The country is stuck in a slow-growth rut, the Federal Reserve suggested Wednesday. The Fed's report on business conditions around the nation, released Wednesday, provided fresh evidence of the toll that housing, credit and financial problems are taking on the economy as a whole. A growing number of analysts believe the economy could be thrown into a tailspin later this year and early next year as consumers and businesses curtail their spending even more.

NEW YORK — Oil prices closed at their lowest level in five months Thursday as a lower-than-expected drop in U.S. gasoline stockpiles gave traders more reason to believe that a cooling economy is forcing Americans to drive less. Light, sweet crude for October delivery fell $1.46 to settle at $107.89 a barrel on the New York Mercantile Exchange. It was crude's fifth straight decline and the lowest settlement price for a front-month contract since April 4.