The US jobs market far from even normal recession levels

From Financial Times

The US economy lost fewer jobs in April than in March – but with more than half a million gone, the rate of job destruction was still very high by historic standards.

Indeed the figure of 539,000 jobs lost was the seventh worst number in half a century. Of the six that were worse, five were the months of November 2008 through March 2009.

Excluding the current recession, you have to go back to December 1974, when the US economy lost 602,000 jobs, to find a worse month for US employment.

In the worst month of the 2001 recession the economy lost only 325,000 jobs, while in the darkest month of the 1991 recession the economy lost only 306,000. Even in the worst month of the deeper 1980 recession the economy only lost 431,000 jobs.

So while the moderation from the revised loss of 699,000 in February (the second worst in half a century) is encouraging, the US jobs market is still far from even normal recession levels, never mind stabilisation.

Then it gets to a really important point--and a reminder of how important the government is in our economy

Beneath the headlines, what is happening? The private sector continues to shed a lot of jobs, with manufacturing, construction and business services (which includes temporary help workers) leading the way.

Every private sector industry lost jobs last month with the sole exception of healthcare, which seems recession-proof, though even in this sector net job creation is lagging last year’s rates.

Unemployment is on the rise and will almost certainly keep increasing for several months, before peaking at or above roughly 9.5 per cent, with a number of economists thinking it will reach double digits.

This is because recovery, even when it comes, is likely to be tepid and insufficient to add enough jobs to compensate for the under-lying growth in the work force.

An increase in participation rates – driven either by workers being forced to look for work out of economic necessity or by some renewed hope that jobs can be found – as in April could continue to push the unemployment rate higher.

Already, the ranks of the long term unemployed have increased sharply, while broad measures of underemployment – including people who are working part time because they cannot find full time work and those who are discouraged from actively seeking work – are at very high levels.

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