Employers nationwide cut 216,000 jobs, a big improvement over previous months, but the unemployment rate rose to 9.7%, reported the Bureau of Labor Statistics today.

The decline in number of jobs cuts — much lower than the 225,000 the consensus expected — was an indication the economy is stabilizing. In January, employers slashed 741,000 jobs.

However, employers continue to lay off more people than they hire, a situation experts say isn't likely to improve until companies are convinced the economic recovery is real. Most economists don't expect that to happen until sometime in 2010.

More worrisome is the unemployment rate, which was the highest since June 1983, when it hit 10.1%.

If the underemployed are included — people who are working part-time who would rather work full-time and those who want to work but have given up looking — unemployment hit 16.8% in August. The underemployment rate was 10.7% a year ago.

The layoffs cut across almost every industry, although health care added a relatively small 28,000 jobs nationwide.

August unemployment numbers for California and Orange County won't be released until Sept. 18. In July, California unemployment stood at 11.9% and Orange County's was 9.5%