Teh Decline: The Geogrophy of a Reccession

[kansas husker]

So, I'm taking a macroeconomics class online, and we are on the chapter dealing with unemployment. A link showing the unemploymnt rates form 2007-march of 2010, was posted by the teacher and I found it frigheningly interesting.

 

Link

[Bradr]

Its like one of those movies where the alien infestation slowly takes over the planet.

[holvy83]

that is interesting, the county i grew up in Iowa has one of the highest unemployment rates. Kind of wonder how that number is figured since it is not a highly populated area and mostly agricultural.

[AndyDufresne]

It looks like the chart stops after January 2010. In 2010, approximimately 600k jobs have been added. The unemployment rate actually fell slightly from May to June. While things certainly aren't rapidly improving, they aren't progressively getting worse like one might infer from watching the linked presentation.

[sarge87]

It looks like the chart stops after January 2010. In 2010, approximimately 600k jobs have been added. The unemployment rate actually fell slightly from May to June. While things certainly aren't rapidly improving, they aren't progressively getting worse like one might infer from watching the linked presentation.

Most all the job gains have been in the public sector -- not the private sector, where economic wellness of the country is measured. Of those 600K jobs added, 400K have been hired as census workers who will be shed as the year progresses, and most of the rest are seasonal workers involved in public works projects. This article explains it better than I can....

 

Behind the unemployment rate: Private-sector hiring still weak

 

Washington Post

July 2, 2010

By Frank Ahrens

 

As we do every month, let's unpack the data buried in today's June jobs report from the Labor Department's Bureau of Labor Statistics:

 

Headline numbers: The official U.S. unemployment rate dropped from 9.7 percent to 9.5 percent. About 125,000 jobs were lost in June. The number of long-term unemployed (out of work for 27 or more weeks) was essentially unchanged from May at 6.8 million. Total unemployed in the U.S. was down just a bit at 14.6 million.

 

Behind the headlines, Point 1: Don't focus on the 0.2 percent decline in the overall rate and think it's good news. The economy lost jobs. The overall number went down only because people left the labor force. That means that, when the BLS conducted its survey, these were people who were out of work but who had not looked for work recently -- probably, they had become discouraged and given up -- so they are not officially counted as unemployed. When the labor force shrinks, it shrinks the unemployment number.

 

Behind the headlines, Point 2: A truer unemployment rate can be figured by starting with the 9.5 percent number then adding all of the people who should be working full time but are not: the discouraged non-workers we spoke of above and people who are working part time but would prefer to work full time. That unemployment rate in June was a much higher 16.5 percent, down from 16.6 percent in May. Though these people are not officially counted as unemployed, they certainly make demands on the system and probably feel pretty unemployed. The number of discouraged workers in June stood at 1.2 million, up 414,000 from a year ago.

 

Behind the headlines, Point 3: 125,000 net jobs were lost from the economy last month because the U.S. Census let go 225,000 temporary workers. Until the decennial count ends this fall, the Census will be the biggest force in the U.S. labor force, as it adds workers in some months and lets them go in others, sort of like a big job accordion. Which brings us to ...

 

Behind the the headlines, Point 4: Only 83,000 private-sector jobs were added in June. That's significantly up from the mere 15,000 private-sector jobs added in May, but it was still below Wall Street estimates and more important is below the number of private-sector jobs that need to be added each month just to keep up with population growth, which is about 125,000. As we saw in the previous month, of the 440,000 new jobs added to the economy in May, almost every one of those jobs were Census jobs, meaning they are only temporary. Private-sector employers are still refusing to hire because they are too scared of where the economy may be going.

 

Behind the headlines, Point 5: Long-term unemployment number is a problem. In June, 6.8 million people were unemployed for 27 weeks or longer. That's up from 6.1 million in February of this year and up from 4.4 million in June 2009. In short, this is not a disastrous jobs report, but it's a bad sign that a jobs report that includes a 9.5 percent unemployment rate is not considered disastrous. Our new normal -- unemployment near 10 percent, European levels -- is going to stick around for a while.