House Speaker Nancy Pelosi’s blog has an interesting graph of What 3.6 Million Jobs Lost Over 13 Months Looks Like.
This chart compares the job loss so far in this recession to job losses in the 1990-1991 recession and the 2001 recession – showing how dramatic and unprecedented the job loss over the last 13 months has been. Over the last 13 months, our economy has lost a total of 3.6 million jobs – and continuing job losses in the next few months are predicted.
By comparison, we lost a total of 1.6 million jobs in the 1990-1991 recession, before the economy began turning around and jobs began increasing; and we lost a total of 2.7 million jobs in the 2001 recession, before the economy began turning around and jobs began increasing.
click on chart for sharper image
Employment Cycles During Recessions
Chris Puplava at Financial Sense pinged me with this chart on Friday.
Chris writes: When comparing the current employment (black dashed line) climate with that of prior recessions shows that we had anemic growth in employment heading into the current recession similar to the March 2001 recession (red line), though we are following the worst cycle on the downside post the recession onset, following the July 1981 recession (orange). Employment didn’t stop falling in the 1981 and 1973 recession until roughly 16 months after the onset, and if we follow a similar pattern than job losses should stop by summer, and if they don’t then this will be the worst job cycle since the Great Depression.
There are clear differences between the two sets of charts although both suggest we are on the road to ruin.
Pelosi: We Cannot Afford Delay on Recovery Package
Inquiring minds are reading Pelosi’s Press Release On Jobs.
“This morning’s startling job loss numbers show why it is imperative that the Congress act immediately to pass the American Recovery and Reinvestment Act to stem the rising tide of unemployment and get Americans back to work. The economic recovery package will create and save more than 3 million jobs and put America back on more solid economic footing.
“With a record 3.6 million American jobs lost in just the last 13 months, we cannot afford to delay legislation that will create new jobs and invest in a stronger economy for years to come. We must complete the American Recovery and Reinvestment Act next week so that the President can sign this critical legislation into law.”
Pelosi’s efforts are misguided. Government cannot really “create” any jobs per se. It can raise taxes and shift private sector jobs creation to government jobs creation (typically a malinvestment), and it can bring production and consumption forward for those jobs that are genuinely needed (filling potholes), but once the potholes are filled, one has to ask the question, “What will we do for an encore?”
So far Congress has thrown over $1 trillion dollars at the problem to no avail. Another $800 billion is not going to do anything but waste another $800 billion. Please see Obama Calls For Sacrifices, Scales Back Campaign Promises, Ups Jobs Program To 4M for further discussion including a pie in the sky graph of the projected unemployment rate with and without a stimulus plan.
This was the largest credit boom in history, and it will be the largest bust, no matter what the “stimulus”.
Mike “Mish” Shedlock
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