2008 Job Losses Probably Worst Since 1945: U.S. Economy Preview

[Omaha Steve]

http://www.bloomberg.com/apps/news?pid=20601087&sid=aboQfkK5Tu_U&refer=home

By Shobhana Chandra

Jan. 4 (Bloomberg) -- The U.S. economy probably lost more jobs in 2008 than in any year since the end of World War II as firings rippled from homebuilders and automakers to banks and retailers, a government report may show this week.

Payrolls fell 500,000 in December, bringing last year’s decline to 2.4 million, the most since 1945, according to the median estimate of economists surveyed by Bloomberg News ahead of Labor Department figures due Jan. 9. The unemployment rate likely jumped to the highest level since 1993.

The figures will underscore the urgency behind President- elect Barack Obama’s plan to pass a stimulus package that will create jobs and mitigate the recession, already the longest in a quarter century. Other reports may show slumps in housing, manufacturing and service industries deepened at the end of last year, setting the stage for more weakness in 2009.

“We’re continuing to lose massive amounts of jobs,” said Michael Feroli, an economist at JPMorgan Chase & Co. in New York. “The negative momentum carrying over into the first half of 2009 will hold down the economy regardless of policy.”

The jobless rate probably climbed to 7 percent in December from 6.7 percent the prior month, according to the survey median.

Manufacturers probably cut 103,000 workers from payrolls, the report may also show. Factories, which make up 12 percent of the economy, shrank in December at the fastest pace in 28 years as new orders for products from cars to furniture reached the lowest level since records began in 1948, the Institute for Supply Management reported last week.

FULL story at link.

[4dsc]

1. So "where" will the recovering come from??

What sector of the economy is going to lead this nation back from this economic abyss?? Financial?? Manufacturing?? Service??

I don't see any sector leading the way which is why I believe we are going to see worsening economic conditions for quite some time..

I don't believe we will ever see a return to "business as usual" in this country..

[Muttocracy]

3. I'd be glad to see government invest in infrastructure

but that's more government borrowing, so I don't know how much more of that we can do. At least work on roads, water treatment, waste management, energy, etc. can't be outsourced - the money stays here, and we all share in the benefits a bit.

But that seems like it's for a long-term investment, and it's going to take a while for that money to prop anything else up.

[.... callchet ....]

2. Numbers

I can't find anywhere the figure of unemployed workers, What is the total amount of people that can work that aren't working. The government figures are based on unemployment claims filed. Any help ?

[enlightenment]

5. Here's a table that helps a little

http://www.bls.gov/news.release/empsit.t12.htm

[.... callchet ....]

6. Thanks

That is a frightening number 12.5 % of the labor force without full time jobs.

[pinqy]

8. But not all of them want full time jobs

And a lot of that 12.5 percent isn't looking for work at all. And some (approx 1.5million) are only looking for part time.

[pinqy]

7. Breaking things down.

The Unemployment figures are based on a household survey.

Break-down of numbers (rounded to nearest thousand) based on November 2008 census estimates and the November Current Population Survey
Total US Resident Population: 305,548,000

But what we're interested in is people who can actually participate in the labor market, so we exclude everyone under 16, everyone in the military (because they can't freely leave), and those in institutions or prison (because they can't freely enter). This leaves us the
Adult civilian non-institutional population: 234,828,000

But now, not everyone wants to work. That number is 75,127,000

So, number of people who are either working or want to work is 159,701,000
Worked Full time: 117,582,000
Part time by choice or non job market factors: 19,892,000
Usually full time, but currently part time due to business conditions or slow work: 5,354,000
Want full time but could only find part time: 1,509,000
Part time for other economic reasons: 272,000
Total employed then is 144,609,000

Of the people who say they want a job, 3,130,000 did not look for work in the last year or are not able (for whatever reason) to start work immediately. They are not considered unemployed or marginally attached because they are in no way participants in the labor market.

Of the 1,947,000 people who are available to work now, and looked in the last year, but not the last 4 weeks (the marginally attached), 1,339,000 didn't look because of personal circumstances (either inability until now to work, or lazy, or waiting for a response from past attempts etc) and 608,000 didn't look because they didn't think they'd find anything they were qualified (discouraged workers). None of these are considered unemployed because they're not participating in the labor market. These groups of the marginally attached and its subset of discouraged workers are important to track, but because they're not actually part of the labor market it's misleading to consider them "unemployed" because their situation cannot change.

That leaves us with those who don't currently have a job, but have actively looked in the last four weeks. These are the officially Unemployed (regardless of whether they ever collected or tried to collect benefits).
694,000 people are now looking for their first job.
2,659,000 had previously worked, were not looking for a job, but have just started.
1,060,000 people don't have a job because their last job was temporary in nature.
916,000 people quit.
1,166,000 are on temporary lay-off (this group doesn't have to be actively looking).
3,520,000 were fired or permanantly laid off.
Total Unemployed:10,015,000

[.... callchet ....]

4. There is no help from within.

That is over. The economy can't work itself out. It has to be bought out. Massive government programs. Spending other peoples money. What a battle that is going to be. Or left to its own devices and create mass unemployment and a return to the feudal system. We do have surpluses.