Comments on: Job Losses in Post WWII Recessions

By: johnbougearel

johnbougearel — Tue, 10 Feb 2009 22:23:43 +0000

Matt G’s Swampland chart merits the following comment that BR, NB, mike j, km4, and dedude all picked up on:

Because the business cycle has been smoothed out, the job recovery in 2001 (in brown) took almost 4 years to rebound. The next longest recovery cycle from net shedders to net creators of jobs was 1991. It took 32 months to get jobs back. The 1981 recovery (orange) from net shedders to net creators of jobs was swift, taking roughly 10 months. The total cycle was 28 months. The problem is once jobs are lost in the new economically flawed paradigm designed by central bankers and in which we now live in is that jobs do not come back. This is the great lesson in this chart and quite frankly, disheartening.

By: How the Common Man Sees It

How the Common Man Sees It — Tue, 10 Feb 2009 04:02:10 +0000

Adjust for population, adjust for labor pool, adjust for baby boomers — you guys really want to make this chart worthless.

Don’t blame us, it’s all Barry’s fault. His teaching has gone and made econoskeptics of us all. This chart was just a test to see if we’d attack when provoked

By: The Curmudgeon

The Curmudgeon — Mon, 09 Feb 2009 22:24:45 +0000

Another very relevant metric is the participation of women in the workforce since the 60’s, which recently peaked and fell somewhat, as I recall.

I think the employment numbers here told speak of a very different economic growth picture than that of a relatively minor hiccup as we’ve generally seen since the Great Contraction. Something new is afoot. Where it leads only time will tell.

By: Todd

Todd — Mon, 09 Feb 2009 21:24:59 +0000

@Common Man
Guilty, got caught up in econo-speak. Not as bad as newspeak where negative budget growth is still positive budget growth, just not has positive as planned.

By: ben22

ben22 — Mon, 09 Feb 2009 21:11:29 +0000

My god, some of you people could take down Dennis Kneale. Maybe even Kudlow.

How about instead of getting caught up on the population today compared to earlier or the percentage of jobs comapred to earlier you just take a look around. No reserach required to see how bad people are struggling right now.

the economy is crashing, falling off a cliff, this quarter looks worse than the last, which was a nightmare.

unemployment is still accelerating, this isn’t the end.

And I highly doubt anyone on this blog remembers what it “felt like” in 48.

Sorry, this was my rant for today.

By: Transor Z

Transor Z — Mon, 09 Feb 2009 20:36:41 +0000

So in corrected terms we don’t know yet how this will compare with the scale of job losses during the 1982 and 1973/74 recessions.

@ Paul S: There was no “pre-recession job loss” from 2006. There was a marked slowing of job growth but still in the positive. Big difference.

How much was retail and financial services employment boosted by the credit bubble? The 73/74 and 82 recessions killed heavy industry — now it’s their turn. Poof.

As many comments on other threads have pointed out, that leaves us looking for The Next Big Thing. U.S. innovation has been focused on productivity, not production.

I find it hard to believe that building a wind farm off the Mass. coast is going to put America back to work.

By: Scott F

Scott F — Mon, 09 Feb 2009 20:22:17 +0000

Adjust for population, adjust for labor pool, adjust for baby boomers — you guys really want to make this chart worthless.

In 2008, the market had its worse year in 8 decades — why would you be surprised that emplyoment looks horrible? The economy is a disaster. (And I am long CSCO and MSFT)

By: sinomania

sinomania — Mon, 09 Feb 2009 20:00:28 +0000

What about the impact of the baby boom generation? The recessions from 1974 on affect the same group of people primarily — the baby boomers. By 1947 population growth in the USA was almost 2% with over 2.7 million increase. By 1950 growth was over 2% with an over 3 million increase.

65 years was only 1944. Those born in 1950 will be 65 in 2015. The last real big year of the baby boom say 1961 – those workers won’t be retiring until 2026 or 2028 when they turn 67! Unless there is some amazing new bubble with all sorts of new jobs created I don’t see how employment can pick up for many many years.

By: How the Common Man Sees It

How the Common Man Sees It — Mon, 09 Feb 2009 19:55:45 +0000

The second chart is great but something tells me it still has to be adjusted for boomers. I’m wondering if someone has done a demographic breakdown as well. That may also be a study you want to pursue Barry is how this whole recession is affecting the boomers as a group. I think a light needs to be shone(I think that is the first time I’ve ever typed that word in a sentence) on them because social troubles that surface in that group over the next decade will be hard to correct. We can joke about Walmart greeters but that will be the rosy scenario for many of them

“5. There is no “right” level of debt, so we don’t know where “deleveraging”

I would tend to agree. To say there is a right level of debt is to say there is a proper amount of theft from your future earnings because that is who it is coming from. That is, unless you can get away with sticking it to your creditors

@Todd Says: February 9th, 2009 at 2:08 pm

We could be on the verge of negative credit growth

Negative credit growth? Is it possible for something to grow in the negative? Are you a government mole?

I think we’re going to have to give you an Orwellian doublespeak penalty there bud.

By: Paul S

Paul S — Mon, 09 Feb 2009 19:35:36 +0000

Looking at YoY changes in the percentage chart, no other recession had the increasingly steepening downward curve that this one does- all were either straight rates of decline, or if they did curve- had inflections in them where the rate improved slightly before continuning down. 1974 is agood example of this inflection.
Also, it seems this recession had a “pre-recession” job loss that the others seem to lack- job losses began apace in early 2006, and the rate of loss now has doubled beginning in 2008. Again- looking at 1973- there was a sort of “pre-recession” job loss, but nothing to compare with the scale of what began now in 2006.

If the current trend compares proportionally to 1974, then we are looking at at least a 6% reduction in the workforce which will continue into 2010.