Weakening Picture

The economic news was about as bad as a party in power could imagine for a pre-election week. The U.S. unemployment rate in October climbed to 6%, the highest in almost three years and a rate exceeded only slightly and rarely since 1961. The Government's index of leading indicators--those that serve as clues to the future direction of the economy--fell 2.5% in September, its sharpest drop in more than 23 years. Productivity, or output per man-hour of the nation's workers, skidded at an annual rate of 3% in the third quarter. Falling productivity pushes up employers' labor costs and puts more upward pressure on prices. There was a smidgen of good news too: First National City Bank of New York cut its prime rate on business loans another quarter point, to 10.75%. But taken together, the week's indicators sketched a distressingly clear picture of a rapidly weakening economy.

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