Troughs – like the one the US economy seems to have fallen into – are nasty places.

Stagnant. Sloppy. Icky. No one really wants to spend time in one.

Unfortunately, that's where many unemployed Americans may find themselves over the next several months as the weak economy struggles to recover. Friday's unemployment report from the US Labor Department showed that the US lost fewer jobs in August than in any month during the past year. But it also suggested that more people were looking for work in an economy where most employers still aren't hiring.

For the moment, the economy's recovery is primarily manufacturing based. Companies have cut their inventories so low that factories have to rev up just to replenish the stock.

But manufacturing is one of those areas that can boost production a lot before it needs to hire new people, points out Nigel Gault, chief US economist for IHS Global Insight. "If we're thinking of job creation, it's going to have to be services that start to generate jobs."

Services offer a mixed picture. Healthcare/education continued to set all-time employment highs in August. The federal government (minus the US Postal Service) is hiring. Private-sector services lost only half as many as jobs in August that they did in July, but that still accounted for a decline of 62,000 positions.

The reason? Wholesale and retail trade, professional and business services, and the leisure industry all contracted in August. Finance, insurance, and real estate companies are going through a structural downsizing in addition to a recession.

Then, there's publishing and the post office, where downsizing doesn't even begin to describe the long slide in employment. Excluding the Internet, the publishing industry last month saw employment slip to 787,500, a historic low in federal records going back to 1990. Post office employment dropped below 700,000 for the first time in 25 years.

Ouch! For those who produce all those newspapers and magazines – and the people who deliver many of them house to house – this is no trough. It's a plunge that seems unending.

Last week, the postal service announced it had negotiated a buyout plan with two unions, where up to 30,000 employees could get a bonus if they opted to quit.

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