Before we get into the charts, these charts certainly underscore the critical need to do much more for job growth than worrying about debt. The Obama Administration and Congress really need to place a much greater emphasis on jobs. This is both a Main Street issue and is also a key piece of shoring up the housing sector.
Looking at Chart 1, it's sobering to see how much higher unemployment has risen, and how fast it's risen in this recession, compared to other recessions. Keep in mind that the vertical axis is percent so the fact that the labor force itself is larger is not a factor in these results. The unemployment rate is a ratio determined by dividing total unemployment by the total labor force. Chart 1 shows that jobs have been shed at a much greater rate than in previous recessions. I suspect that's due to (a) fewer restrictions on an employer's ability to reduce their workforce, and (b) employer's perception of the likely depth and length of the recession.
What I find even more shocking is Chart 2, the percentage change in the civilian employment by month across post WWII recessions (Charts 1 and 2 aren't directly comparable). Chart 2 is just the monthly percent change in civilian employment and it's a dramatic drop.
Chart 3 shows the percentage change by month of the civilian labor force. The civilian labor force is defined as people 16 years old or older who are not in the military, prison, institution, school and are employed or looking for work. Chart 3 shows that the civilian labor force kept growing, but at a slowing rate, up until about this past October. Then, the civilian labor force actually began to shrink.
A drop in civilian labor force can be due to a variety of reasons though a significant reason right now is it likely reflects people dropping out of the labor force as they stop looking for work. Another factor may be immigrants, legal and otherwise, returning to their prior home since labor force includes U.S. citizens as well as legal and illegal aliens. One aspect of the labor force decline that concerns me is I suspect there's a good deal of older folks (over 40) in this pool whose jobs are not likely to return. This type of unemployment problem is called structural unemployment. It's the most difficult type of unemployment to solve. Another concern with a declining labor force is that it also reduces what the economy can produce, absent an offsetting productivity gain.
For a bit of good news, Chart 6 illustrates that the official unemployment rate is nowhere near the official rate of the Great Depression. By official unemployment rate I mean to suggest that the actual unemployment rate is greater. The official rate does not count people who would like a job but have stopped looking for work. These people are referred to as discouraged, despite whatever they might be called on FOX News!
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