Strongest Jobs Recovery In Decades. Seriously

[Velleity]

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NEW YORK (CNNMoney.com) -- A jobless recovery? Hardly.

http://money.cnn.com/2010/09/02/news/economy/jobs_recovery/index.htm



By historical standards, the labor market is recovering nicely -- job growth has started earlier than in past recessions.

But the unemployment problem isn't going away. An especially tough recession has raised the bar on the amount of job growth needed to recover, magnifying the pain of the struggling labor market.

"If you had a severe recession, you tend to have a strong recovery," said Robert Brusca of FAO Economics. "So far that hasn't happened."

The unemployment rate hit a high-water mark of 10.1% in October 2009 and has since fallen to 9.5%. Payrolls began growing in November and, excluding the impact of temporary census jobs, the economy has added jobs every month since January.

That's a much quicker peak than previous job market recoveries.

After the 1990-91 recession ended, the economy lost nearly 300,000 additional jobs in the 11 months that followed. And the 2001 recession was followed by a so-called jobless recovery that lasted for nearly two more years.

"Sustained, positive job formation began earlier in this recovery than in the prior two recoveries," said Lakshman Achuthan, managing director of Economic Cycle Research Institute.

But today's economy is different. The problem is that the damage done during the Great Recession was so severe, it will take a lot more growth than normal to dig the job market out of its hole.

There were 8.4 million jobs lost in 2008 and 2009 -- roughly 7% of all jobs at the start of the recession. That compares to a loss of 3.1% of all jobs during the 2001 recession and the jobless recovery that followed, and only 1.9% of jobs lost during and after the 1990-91 recession.

And there are concerns about the fact that job growth has slowed dramatically from the spring of this year when employers were adding about 200,000 workers a month to payrolls. Even at that pace of hiring, it would take more than three years to get jobs back to pre-recession levels.

Right now, it's not even close. Overall payrolls, excluding the temporary boost from census jobs, have increased by an average of just 12,000 jobs a month over the last three months.
0:00 /5:36Double-dip or just slow growth

And as the government prepares to release its August jobs report on Friday, economists, employers and job seekers are all watching with bated breath.

Brusca said given the fact that job losses took place throughout 2008 and 2009, it's still too soon to conclude whether the recovery is going to come up short. He's still hoping growth picks up in the fall as businesses start to gear up for the holiday shopping period.

"The summer is not the time you want to be taking the temperature of the economy," he said. "Come September and October, if the data is still weak, I'll sing a different song."

But the weaker numbers of late have sparked fears that the nascent jobs recovery could stall out and the economy could topple into a double-dip recession.

Heidi Shierholz, labor economist for the Economic Policy Institute, thinks another shot of stimulus spending by the federal government is called for in order to avoid more job losses.

"We owe the growth we have seen to the measures that the Fed and Congress took in early 2009," she said. "It's great to put the brakes on the jobs losses of last year, but we need to do more." To top of page

[Observer]

Vel, in case you missed it, unemployment is UP to 9.6%

[Velleity]

Do you have any actual economic analysis, or just your usual anal cyst?

[johnhp]

A lot of the jobs lost were government jobs.  The private sector added 67,000 jobs.

The report is better than expected, but experts say it's still not good enough. The U.S. Lost 54,000 jobs last month. But if you subtract job cuts by the government, the private sector actually gained 67,000, beating Wall Street expectations.

http://www.wqow.com/Global/story.asp?S=13099742

In fact it was the eighth straight month for job gains in the private sector of under 100,000 jobs.  Unemployment may keep going up because the workforce grows each month, not necessarily because of a net loss of jobs.

Here's the problem. August marked the eighth straight month of job gains in the the private sector – a welcome pattern that President Obama was quick to highlight. Yet those gains average less than 100,000 per month. That's not enough to improve the job market, economists say.

How's that? Well, if the whole economy, including government, ticked along at a pace of 100,000 job gains per month, it wouldn't be fast enough to account for natural demographic growth in the labor force. A rising population means about that many new people should be entering the workforce each month.

So a modest pace of 100,000 jobs a month is certainly better than declines, but it doesn't begin to fill America's jobs hole.

In fact, unemployment could actually rise more. On Friday, the Labor Department said the jobless rate edged up to 9.6 percent in August, from 9.5 percent in July. The disappearance of Census jobs outweighed a gain of 67,000 new jobs in the private sector.

http://www.csmonitor.com/Business/2010/0903/Why-100-000-jobs-a-month-won-t-lower-unemployment-rate

In addition, we saw this month a modest decrease in the number of people unemployed for 27 weeks or longer.

And although unemployment edged up, the number of people who have been unemployed for 27 weeks or longer fell. Some 42 percent of unemployed Americans fall in that category, down from 45 percent a month earlier.

http://www.csmonitor.com/Business/2010/0903/Why-100-000-jobs-a-month-won-t-lower-unemployment-rate

Oh, and who should be held responsible for this and other economic issues?  71% of Americans say Bush.

In a USA TODAY/Gallup Poll taken Friday through Sunday, more than a third of those surveyed said George W. Bush deserved a great deal of the blame for economic woes and a third said he should get a moderate amount of it. Not quite another third called that unfair, saying Bush warranted not much or none of the responsibility.

The 71% saying Bush should get blamed was a modest decline from the 80% who felt that way about a year ago, in July 2009.

http://content.usatoday.com/communities/theoval/post/2010/09/poll-george-w-bush-obama-economy/1

[Velleity]

You forgot the best part John: average wages of those employed went up.

The recovery is going to be led by consumers who have jobs. New jobs help of course, but those with jobs having more money to spend will lead us out. If it were up to the new jobs we would never recover.

Ivan is so stupid that he never seems to understand how critically important it is for consumers to spend in a capitalist system, and ironically he invariable labels the notion as "socialism". Observer is just oblivious.

[johnhp]

Thanks for reminding me.  i had forgotten.

[nraforlife]

..........................

The recovery is going to be led by consumers who have jobs. ............

Pelosi says the 'recovery' is being 'lead' by fed spending on unemployment and food stamps.