On Thursday, government statistics announced that 516,000 Americans filed for unemployment in the first week of November. Today, 16,000 more workers from two companies joined what is likely to be a daily list that strikes fear into the hearts of people across the country. And why not? After eight years of declining inflation-adjusted wages, their reward for hanging on is a heightened risk of losing those jobs altogether and competing with more people for fewer jobs in a receding economy.

The two companies announcing big layoffs: a big bank and a leading tech company that sells to banks. According to reports, Citigroup (NYSE: C) may lay off 10,000 employees -- adding to the 23,000 it has already cut in the last year. Sun Microsystems (NYSE: JAVA) announced it will can 6,000 people -- 18% of its work force --- citing the need to "align its cost model with the global economic climate."

Is this the bottom? I seriously doubt it. The unemployment rate could get up to 8.5%, and maybe as high as its post-Depression high of 10.7%, up from its current 6.5%. At least that's what Nobel Prize winning economist and New York Times op-editorialist Paul Krugman expects. Needless to say, in an economy which depends on consumers for 70% of its growth, this is not good news since it divides the country into two categories -- those who lose their jobs and those who fear losing them.

And both groups are likely to spend less.

Peter Cohan is President of Peter S. Cohan & Associates. He also teaches management at Babson College. His eighth book, You Can't Order Change: Lessons From Jim McNerney's Turnaround at Boeing, will be published by Portfolio on December 26, 2008. He owns Citi shares and has no financial interest in Sun securities.