Despite the predictions of many economists, job loss worsened in December, with a net loss of 85,000 jobs. The U.S. Department of Labor jobs data out today shows the number of those officially unemployed—15 million—remains the same, as does the 10 percent unemployment rate.
But the Economic Policy Institute (EPI) says the jobless rate remained unchanged only because the labor force declined by well over half a million (661,000) workers in December. If these workers had been in the labor force unemployed, the unemployment rate would have risen to 10.4 percent. Some 7.2 million jobs have been lost since the recession began in December 2007.
Employment in December fell in construction, manufacturing and wholesale trade, while temporary help and business services, health care and education added jobs. Unemployment among teens is at a devastating 27.1 percent and for blacks, 16.2 percent. The jobless rate for Latinos is at 12.9 percent and for white workers, 9 percent.
But when both unemployed and underemployed workers are counted, there still are some 26 million people without jobs or full-time work. Another sign of the depth of the jobless rate that often goes unreported: The number of long-term unemployed (those jobless for 27 weeks and over) continued to worsen, hitting 6.1 million. In December, four in 10 unemployed workers were jobless for 27 weeks or longer and there are now six job-seekers for every one job available.
More than 7.2 million jobs have been lost since then.
Overall, the employment picture has improved over the past few months, with 450,000 jobless claims filed per week in December 2009, compared with 600,000 a week in March. In fact, weekly jobless claims in December were at the same level as in August 2008, right before the unemployment rate worsened dramatically, according to EPI economist Heidi Shierholz.
But Shierholz and EPI President Lawrence Mishel also warn that because the labor force has not grown in recent months, it’s a sign many people have given up looking for jobs or otherwise aren’t in the labor market. When the 2.7 million jobless workers who have left the labor market return to look for work, the unemployment rate could worsen rapidly unless Congress and the Obama administration support robust job creation.
Most economists don’t see the jobless rate improving for years, with estimates of 7 percent unemployment through 2012. Mishel says estimates by Goldman Sachs and economy.com predict unemployment could worsen to 10.5 percent this fall—and will fall to 9.7 percent only with a vigorous jobs initiative by Congress.
AFL-CIO President Richard Trumka says because it has taken “years of financial abuses and corporate giveaways to get us into this deep hole,”
we will only climb out if we keep our foot on the accelerator. We urge Congress to move quickly to pass emergency legislation. The bill passed by the House in December is a good start.
But more needs to be done. As part of the AFL-CIO jobs plan, we’re pushing Congress and the administration to:
- Rebuild America’s schools, roads and energy systems.
- Increase aid to state and local governments to maintain vital services.
- Put people to work doing work that needs to be done.
- Put TARP funds to work for Main Street.
The nation’s current “jobless recovery” (an oxymoronic euphemism for anyone out of work and struggling to feed a family), is unusual in several ways, including the extent to which young workers have been hard hit, says Shierholz.
We have never just seen anything like this in modern times, this broad a swath of young people affected by the labor market.
Another difference, says Mishel, is the fact, unlike in previous recessions, productivity has increased because employers have slashed hours worked.
Bruce Bostick, a member of Alliance for Retired Americans who was forced into early retirement because he can’t find any jobs, identifies one reason behind the nation’s jobs bleed.
For all the people I know, we have been facing an emotional as well as an economic depression for a long time now. The problems we are seeing are a result of an approach by politicians of redistributing wealth upward. The upward redistribution is now greater than it has ever been. We need to produce jobs for Main Street.