Friday, December 4, 2009

Brace Yourself: Looks Like a Long Recovery Period

The graph at the right, from, shows a graph of unemployment, measured by percentage job losses during each recession since World War II. The horizontal axis is calculated in months. The typical recession has job losses between one and three percentage points, bottoms out in six months to a year, and employment recovers in about the same amount of time it took to bottom out.

Look at the graph of our current recession, the bright red line showing a loss of over 5% of all jobs, equalizing the job loss of the worst post World War II recession of 1948: while it shows signs of bottoming out (unemployment declined from 10.2% to 10% in November), it took a full 23 months to get here, suggesting it may take as long to get to full job recovery. The graph also shows recent recessions have taken longer for employment to recover, for complicated reasons which have something to do with the relative power of capital vs. labor in the U.S. in the last three decades. The 2001 recession required nearly four years to recover to full employment, even though the economy as a whole was growing again in less than a year.


Anonymous said...

And here in southern New Mexico where Gov Richardson has forgotten us we will never bounce back.


Anonymous said...

What does the New Mexico Border Authority do? I seen some billboards, are they like the border patrol.

Jose Z. Garcia said...

NM Border Authority is supposed to be dealing with border infrastructure needs, like roads, utilities, to help interface with Mexico. It did a lot at the beginning of the 1990s and then in the mid-2000s. Recently as far as I can tell it has not been very active, but I could be wrong, it might just be they haven't publicized their activities.

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