Mar., 09 /Lingering economic uncertainty continues to take its toll on the nation's employers, who shed more jobs in February than during any other month since the aftermath of the Sept. 11, 2001, terrorist attacks, according to data released Friday.

The Bureau of Labor Statistics said the country's unemployment rate edged up to 5.8 percent last month from 5.7 percent in December and 5.6 percent in February 2002.

Nonfarm payroll employment fell by 308,000 last month, the worst showing since a drop of 327,000 in November 2001.

The job losses dashed hopes that a sharp improvement in January's unemployment rate signaled the start of a rebound in hiring. Instead, the numbers show that finding a job isn't getting any easier, especially with the threat of a war against Iraq.

"As long as the war threats are there, we will see the economy treading water at best," said Sung Won Sohn, chief economist at Wells Fargo & Co. in Minneapolis.

In Texas, the seasonally adjusted unemployment rate in January slipped to 6.4 percent from 6.5 percent in December, according to the Texas Workforce Commission. That's still up from 6.1 percent in the year-ago period. The agency won't release February's unemployment rate until near the end of this month.

"Most of the economy is fairly stagnant at this time," said Robert Crawley, an economist at the commission.

Although the state's education, health services and construction industries created the most jobs in January, technology, air transportation and other sectors with significant layoffs over the last 1 1/2 years have yet to make a recovery, Mr. Crawley said.

Dallas' unemployment rate surged to 7.3 percent in January from 6.1 percent in December. But the increase includes the loss of retail and other seasonal jobs following the winter holidays.

Nationwide, the grim economic news was tempered by the fact that about 150,000 reservists called into active duty as of mid-February probably made the unemployment numbers worse than they actually are, economists said.

Many companies are not hiring temporary help to fill reservists' jobs, which reduces the number of people on their payrolls.

"The news is not as bad as the numbers would indicate," Mr. Sohn said.

And hiring could get a jumpstart if the United States wins a quick victory in a possible war with Iraq, he added.

But for now, employers' renewed cautiousness about adding jobs, which is being blamed on the uncertainty over a possible war, is making it harder to find work.

Of the 8.5 million people unemployed in the United States, 1.9 million or 22 percent have been looking for jobs for nearly seven months or longer, up from 15 percent a year earlier, Bureau of Labor Statistics data shows.

And at 18.6 weeks, the average amount of time spent unemployed has risen to its highest level since October 1994, when 19.3 weeks was the norm.

Economists say the nation is now mired in a jobless recovery that threatens to turn into a double-dip recession should a possible war in Iraq go badly.

Despite the beginning of an economic recovery in January 2002, the country's unemployment rate since November 2001 has hovered in the 5.6 percent to 6 percent range.

That's a departure from the outcome of previous downturns. The economy began rapidly creating jobs in the 13th month after the 1991-1992 recession ended, Mr. Sohn said. "We are past the 13th month, but we are still losing jobs."

Although manufacturing has long been shedding workers, the service sector, the engine of economic growth during much of the 1990s, is starting to wilt.

The economy lost 86,000 service jobs last month, the largest monthly job loss since the fall of 2001. A large amount of the decline came from restaurants and other eating and drinking establishments.

"Restaurant operators are really reticent to staff up in light of the uncertain conditions," said Hudson Riehle, senior vice president of research for the National Restaurant Association.

Despite the industry's cautiousness, it is expecting sales to grow 4.5 percent this year to $426 billion, he said. Restaurant operators are using technology to become more productive, which eliminates the need for more workers, he added.