The unemployment rate in the US rose to 10.2% in October, which was its highest rate since April 1983, according to figures from the US Labor Department.
It rose from September's figure of 9.8%. The economy lost 190,000 jobs in the month. Since the recession began in December 2007, the number of unemployed has risen by 8.2 million, while the jobless rate has risen from 4.9%.
President Barack Obama described the rise in unemployment as "sobering".
"I will not rest until all Americans who want work can find work," he added.
He also said he would be signing legislation to extend unemployment benefit, cut taxes for businesses and extend tax credits for home buyers.
Analysts were also downbeat after the worse-than-expected figures.
"It's pretty disappointing overall," said Richard Franulovich at Westpac.
"Job losses are not moderating as quickly as I had hoped despite those earlier indicators on jobs."
Dollar falls
The figures were particularly poor given Thursday's news of a fall in initial weekly jobless claims and the data earlier in the week that showed the US economy had grown by 3.5% between July and September.
The number of unemployed people rose by 558,000 to 15.7 million.
But there was some better news with the revision of September's figure from a loss of 263,000 jobs to a loss of 219,000 jobs.
The dollar fell against both the euro and the yen following the release of the figures.
Long-term unemployed
The sectors contributing the largest numbers of job losses in October were construction, manufacturing and retail.
It was the 22nd month in a row that the US economy had shed jobs, which is the longest run since records began 70 years ago.
There is concern that rising unemployment could scupper the recovery by restricting consumer spending, which accounts for 70% of the economy.
The number of people who had been out of work for at least six months rose to a record 5.6 million, accounting for 35.6% of the jobless total.
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