But an unexpected uptick in the unemployment rate — to 9% last month from 8.8% in March — offered a harsh reminder of how deep the roots of America's jobs problem go and how great the challenges remain."Just to return to pre-recession levels." Let's see, 7 million/250,000 --> 28 months -- only two more years if we keep this pace.
The country gained 244,000 net jobs last month but still needs about 7 million additional jobs just to return to pre-recession levels.
[Update: after posting the above, I ran across this:
Although Friday's numbers certainly mark an improvement over previous reports, it will take another two and a half years before the economy reaches prerecession employment levels. How long after that it will need to add enough jobs to compensate for population growth will depend on how many people rejoin the labor force. Without question, it would be many more months. -- we must have used the same numbers![Update, May 8, 2011: and there's more:
- At the current pace of job creation, the economy won't return to full employment until 2018.
- Middle-income jobs are disappearing from the economy. The share of middle-income jobs in the United States has fallen from 52% in 1980 to 42% in 2010.
- Middle-income jobs have been replaced by low-income jobs, which now make up 41% of total employment.
- 17 million Americans with college degrees are doing jobs that require less than the skill levels associated with a bachelor's degree.
This graph/link to Carpe Diem provides some insight into the tectonic shifts we are witnessing. This graph explains why 10% unemployment is the new norm. With this kind of productivity/worker, it hardly makes it necessary to increase hiring. I'm waiting for the day when one can punch in a McDonald's order on a SmartPhone or at the restaurant, and then run a credit card through a reader, and pick up one's order without giving the order or the money to a cashier. Same concept as self-checkout at the grocery store.
Carpe Diem.com provides a silver lining to this cloudy report; and the comments add some perspective, something the mainstream media failed to report.
Meanwhile more than 80 percent of Americans feel the economy is in poor shape with unemployment the number one problem.
I have to laugh! In every recession, there is a mindset among some that our best days are behind us and "it" will never be the same again much less better.
ReplyDeleteThen somehow we move ahead strongly.
This recession hit hard because it was not like recent recessions which were mostly the product of the fed cooling an overheated economy or constrained to particular sectors like the cold war defense drawdown. It is going to take time and we need to do all we can to ease the pain for those most affected near term.
I have the same feeling that you do.
ReplyDeleteI think we have accepted 10 percent unemployment/20 percent underemployment as the norm.
I do a lot of traveling and I don't see much evidence of any slowdown.
I think there are several reasons:
a) "The Greatest Generation" that was expected to leave $1 trillion to their heirs, are now living off the interest of their investments, and in some cases the principal. But "The Greatest Generation" learned to live with less and delayed gratification. Those at the lower end have learned how to live with less and continue to delay gratification.
b) The young folks between 15 and 45 years of age who do not work, have never worked, and will never work due to the recession(s) and the "lost decade) for the most part are being supported by their parents, part of "The Greatest Generation."
c) Legal and illegal immigrants continue to support the underground economy and help keep prices down. The immigrants, also, have learned to live with less.They appreciate hope and freedom more than current luxuries.
d) People have gotten used to the fact that their homes are "under water" -- worth less than they owe -- but no longer care. They will stay in their present homes as a place to live, not as a place to "flip" for a quick profit.
I see traffic jams everywhere; I see waiting lines outside restaurants (the new "Pink Berry" restaurants -- lines are so long, my wife has not yet had an opportunity to go to one); Apple computers at $1500 and more fly off the shelves; teenagers all have cell phones with $100/month data plans.
I think we are seeing tectonic shifts in American culture, and 10% unemployment/20% underemployment is no longer a problem when one sees 20% unemployment/50% unemployment elsewhere. People continue to flock to America.
Thank you for taking time to comment.
Oh, and despite 10% unemployment (the new norm) and 20% underemployment, corporate earnings have never been higher, and folks are willing to pay $37,000 for a compact car called a Volt.