The Jobs Disaster – the Long View
Today, the Labor Department reported that nonfarm payrolls (jobs) increased by 80,000 in June. Today’s chart provides some perspective in regards to the US job market. Note how the number of jobs steadily increased from 1961 to 2001 (top chart). During the last economic recovery (i.e. the end of 2001 to the end of 2007), job growth was unable to get back up to its long-term trend (first time since 1961).
More recently, the number of nonfarm payrolls has been working its way higher but at a pace that is not fast enough to close the gap on its 1961 to 2001 trend. It is interesting to note that the current number of US jobs recently surpassed its 2001 peak. However, if this month’s pace of 80,000 new jobs were to continue for each and every month going forward, the 2008 peak would not be reached until the third quarter of 2017.
5 Comments
That is one hell of a correction……………
what is the demographic basis for the trend line? population is not increasing at that rate(is it?), baby boomers are retiring etc. In other words, the trend line is not like a law of nature or even economics; it maybe useful to draw some short term conclusions but what is short term may also be hard to determine.
For many years I watched the juggernaut that was the backbone of the US economy, namely, housing and construction.
Now that this is dead in the water it looks like what is left of manufacturing cannot carry the load as it should be able to do so.
I’d just love to promote free trade here in recognition that economists, more learned than I, believe it is sacrosanct. I cannot.
It sure looks like there is a floor, under which, employment in manufacturing cannot decline without long term damage to the domestic economy and social network and free trade is hardening that floor.
It looks like many western economies are under that floor and, just because free trade is sacred, are unwilling to shift the paradigm to get above that floor and stay there.
By the way, love the new look Cullen. Good work.
Unfortunately, the population has grown since 2001, so using non farm payrolls straight out makes for an ignorant or maliscious view of reality. I find it funny how many People have been hoodwinked by the manipulation of data in the current environment. It seems like most of the blogosphere is just a megaphone attached to the mouth of Goebbels reincarnate in DC. Congrats on writing for the establishment, you will always be loved as you will always be in the majority.