President Barack Obama described America's unemployment rate as ''sobering news'' after new figures showed it had reached a 26-year high, and that another 467,000 people lost their jobs during June - a big jump on May, which had brought hopes of a turnaround.

The nation's unemployment rate rose to 9.5 per cent from 9.4 per cent, the labor Department said, and most economists now believe it will top 10 per cent before the end of the year. Some 14.7 million people are now looking for work.

But perhaps more alarming is that the June numbers show that employers are continuing to jettison their workers at an alarming rate.

467,000 American jobs were lost in June, according to the Labor Department, far more than expected.

Job losses peaked in January and had declined every month until this latest figure.

Economists had been forecasting a more modest figure of 350,000 jobs shed for June, in line with the May job losses.

Speaking from the Rose Garden at the White House after a meeting with energy executives, Mr Obama said the latest unemployment figures were ``sobering news'' and that they showed the urgency of investing in new industries such as clean energy to generate new jobs that can't be sent overseas.

''We have to unleash the great generative powers of the American economy,'' he said, adding that the executives he had talked to in the industry were looking to double and triple their companies thanks to the policies to drive investment in renewable energy.

There have also been other worrying signs that the US economy is still in terrible shape.

The consumer confidence index fell after several months of improvement as Americans worried about a protracted downturn and rising unemployment. The index fell to 49.3 from 54.8 in May. House prices are also continuing to fall.

Of those with jobs, wages were flat and many employees had their hours cut last month.

There was, however, a slither of good news on Wednesday when the car makers reported that sales were down on May but the decline was less steep.

Year-over-year declines last month slowed for four of the six major car makers, with Ford Motor Co - the only major US automaker not in bankruptcy - reporting the smallest drop in a year at 10.7 per cent when compared with June of 2008.