Floyd Norris explains why the unemployment numbers are worse than they first appear:
In the early recessions of the post-World War II period, a much larger proportion of the unemployed were laid off from jobs that they could expect to get back when the economy recovered. Now, that proportion is down sharply.
But the percentage of unemployed who lost jobs, with no expectation of retaining the old job, is at the highest level since the government started collecting that data in 1967. It is reasonable to think those people are more worried, and less willing to spend, than are those who feel sure it is just a matter of time before they get back to their old jobs.