The American economy slid deeper into recession last month as many companies slashed their payrolls and the civilian unemployment rate rose to 6.2 percent, the Labor Department reported yesterday.

The Federal Reserve responded immediately and aggressively by cutting two key interest rates, a move that prompted several major banks to cut their prime lending rates to 9 percent from 9.5 percent.

Analysts used words like "devastatingly weak" to describe the economic picture painted by the employment report. Details of the report, including a sharp 1.9 percent decline in the total number of hours Americans worked last month, indicated the economy was still deteriorating at a rapid rate, the analysts said.

The report showed that blue-collar workers were particularly hard hit. {Details on Page C1.}

The Federal Reserve's actions, intended to give the economy a boost by cutting the cost of borrowing, included a cut in its discount rate -- the interest rate it charges when it lends money to financial institutions -- to 6 percent from 6.5 percent.

"Action was taken in light of further declines in economic activity, continued sluggish growth in money and credit, and evidence" that inflationary pressures are abating, the Fed's announcement said.

Later in the day the central bank pumped money into the banking system to tell investors that it had also lowered its target for the federal funds rate -- the rate banks pay when they borrow money overnight from each other -- to 6.25 percent from 6.75 percent. That meant that banks could obtain money to lend more cheaply.

"The Fed made a decision that they had to kick-start the economy," declared Alan Leslie of Discount Corp. of New York, a major government securities dealer. "They wanted to wake people up with this move."

As a result of the Fed's moves, several major banks, including Citibank and Bank of America, the nation's two largest, reduced their prime lending rates to 9 percent. With most business loans and a growing share of consumer loans, such as home-equity lines of credit, tied to the prime, the half-point reduction means the impact of the Fed's action will be felt quickly by many borrowers.

At 6.25 percent, the federal funds rate is low enough that some banks could be encouraged to cut their prime lending rates to 8.5 percent in coming weeks even without further Fed action, some analysts said.

President Bush, in his State of the Union message Tuesday night, urged quick action to lower interest rates. Deputy Treasury Secretary John Robson continued the pressure yesterday after the Fed acted, saying, "I think there's ample latitude for more movement."

As both short- and long-term interest rates tumbled yesterday, yields on 30-year U.S. Treasury bonds dropped from 8.19 percent to 8.09 percent. Most analysts expect long-term rates to fall further given the weakness in the economy. As that happens, rates on home mortgages should come down as well, which could help the devastated housing industry, probably the economy's hardest-hit sector.

It was less clear, however, that lower interest rates would do much immediately to get banks to step up their lending to businesses, particularly because many larger banks have been hurt by heavy loan losses and have been reluctant to make new loans.

Federal Reserve Chairman Alan Greenspan has said he believes this unwillingness to lend, the so-called credit crunch, along with a major decline in consumer and business confidence as a result of the Persian Gulf crisis, are the principal factors behind the recession.

Some analysts, such as Lyle Gramley, a former Fed governor and now chief economist of the Mortgage Bankers Association, said the central bank's moves would work. "All of this will be helpful to the economy and helpful to the banking system, encouraging them to make more loans," Gramley predicted.

Businesses have trimmed production schedules and payrolls as consumers, uncertain about the war's course, cut back their purchases. Manufacturing jobs dropped by 70,000 last month, bringing the total lost over the past two years to 900,000. Construction employment fell 155,000 last month, a figure probably swollen by unusually bad weather in some parts of the country.

The extremely bad news on payrolls -- December's job loss, originally reported as 76,000, was also revised upward to 148,000 -- and hours worked surprised most analysts, and apparently Federal Reserve officials as well. Greenspan had said in several recent public appearances that there were preliminary, unconfirmed signs that the economy's drop into recession had begun to slow down.

Analysts pay close attention to the figures on hours worked because they are good indicators of how many goods and services the economy is producing.

If payrolls and the number of hours worked fall as much this month and next as they did in January, analysts said, the gross national product could decline this quarter at an annual rate of as much as 5 percent, after adjustment for inflation, some analysts estimated. Prior to yesterday's report, most forecasters had predicted the first-quarter drop in economic activity would be smaller than the 2.1 percent rate at which real GNP fell in the fourth quarter.

Forecasters were busy revising their predictions downward yesterday, and said they believe the Fed will have to cut rates again to get the economy moving upward.

"The economy was in a deep slide in January, and immediate action beyond what the Federal Reserve was doing was absolutely essential," said Allen Sinai, chief economist of the Boston Co., an economic consulting firm. "The Federal Reserve has no time to lose in trying to arrest the slide in the economy."

Charles Lieberman, managing director of Manufacturers Hanover Securities Corp., like most analysts was surprised by the employment report.

"I thought the economy was weak, but this suggests it is even weaker," Lieberman said. "I thought people were crazy talking about whether the economy had already bottomed. ... But like Greenspan, I thought the worst was behind us, that the rate of decline had slowed. That is no longer the case."

"The rate of decline in January was just as great {as earlier} and that rate is nothing short of massive," he said.

The unemployment rate rose only to 6.2 percent from 6.1 percent last month because a big decline in civilian employment was almost matched by a large drop in the size of the labor force. Over the past year, the labor force has grown by a scant 150,000, while the number of people with jobs has fallen by slightly more than 1 million, to 116.9 million last month. Had the labor force grown normally, the unemployment rate likely would be more than 7 percent, according to labor market experts.

Janet L. Norwood, commissioner of labor statistics, said the slower labor force growth is due both to smaller increases in population and a slowing of the trend of a larger share of women choosing to work. Whatever the reasons, the lack of labor force growth has limited the rise in the unemployment rate.

According to the Labor Department report, the 5.6 percent unemployment rate for adult men and the 5.3 percent rate for adult women was unchanged last month. Unemployment among teenagers rose from 16.6 percent to 18.2 percent.

The unemployment rate among white workers rose from 5.3 percent to 5.5 percent while that for blacks fell a tenth of a point to 12.1 percent.

Slightly more than 7.7 million persons were unemployed last month, up from 6.5 million in January 1990.