Wall Street wrapped up a winning week Friday as investors cheered a government report indicating employers cut fewer jobs last month than expected.
The Dow trended higher in four of five sessions and closed with a weekly gain of more than 270 points.
The rally was supported on Friday, when the Labor Department reported U.S. employers trimmed 345,000 positions from their payrolls last month. That's considerably less than the half-million job losses many economists had projected.
Nevertheless, the nation's unemployment rate rose a half point from April to 9.4 percent. That too was lower than many analysts expected, but is still the highest jobless rate in 26 years.
General Motors, which joined Chrysler in bankruptcy this week, announced it will close a dozen factories idling 18,000 to 20,000 workers.
At least one employer is hiring, though… Wal-Mart, the world's largest retailer, says it's opening about 150 new or expanded stores in the U.S. in 2009, and expects to hire about 22,000 people.
Rural America, of course, isn't immune to the scourge of unemployment. And this week the nation's dominant manufacturer of agricultural machinery announced it too is cutting jobs.
Deere and Company posted second quarter net income of $472.3 million, or $1.11 per share in May, down 38 percent from the same period last year. Deere's ag division reported a 4 percent decline in second-quarter sales creating a 19 percent reduction in second-quarter profits. The company's construction and forestry division endured an even bigger decline with sales plummeting 55 percent resulting in a $75 million loss.
In light of the earnings report, Deere announced it will layoff 700 workers at its Ottumwa, Iowa factory where 980 people are employed. Combined with previous layoffs Deere has cut about 1,600 employees from its Iowa payroll, or 13 percent of its 12,000 employee Iowa workforce.
According to Iowa State University economist Neil Harl, the agricultural based economy may seem shielded from the current global economic crisis, but it isn't totally insulated.
Dr. Neil Harl, Iowa Sate University: "Agriculture is not an economic island. I testified to congress on April 1st about this. The key point I made in the very first paragraph is agriculture is not an island. It is missing the bullet here, but the longer this thing continues, the downturn, the global meltdown, the more it affects agriculture. And, you have to separate agriculture from rural areas. Rural areas have been hurting far more than the agricultural sector has been because these are the people who have been laid-off from Deere. But, agriculture has been buoyed up because we've had better agricultural prices."
In the midst of the layoffs, Deere announced that Samuel Allen will replace Robert Lane as its chief executive. Allen, who started with Deere in 1975 as an engineer, will be the ninth CEO in the company's 172-year history.