The jobs deficit: In the hole until 2024?
The election is over, but the challenge of putting America back to work remains -- big time. So big time that it's extremely discouraging to economists such as Heidi Shierholz at the Economic Policy Institute. The bottom line? We need 378,000 new jobs a month over three years to get to where we were in employment in December 2007, the start of the recession. Last week, there was a lot of hand-clapping over the 171,000 jobs
The jobs deficit: In the hole until 2024?
Jane M. Von Bergen, Inquirer Staff Writer
The election is over, but the challenge of putting America back to work remains -- big time. So big time that it's extremely discouraging to economists such as Heidi Shierholz at the Economic Policy Institute. The bottom line? We need 378,000 new jobs a month over three years to get to where we were in employment in December 2007, the start of the recession.
Last week, there was a lot of hand-clapping over the 171,000 jobs reported by the U.S. Labor Department. Yes, 171,000 jobs is a significant improvement, but it's not nearly enough, said Shierholz. She fears the stark reality of the nation's job situation will get lost in premature rejoicing.
Let's do the math: From December 2007 until the worst point, in February 2010, the economy dropped by 8.7 million jobs. Since then, 4.5 million jobs have been added, but a deficit of 4.2 million remains.
Now, here's the killer. Each month, just to stay even with population growth, the economy needs to create 100,000 jobs. So there are 58 months between the start of the recession and now. That's 5.8 million jobs that didn't get created. Add 5.8 million to 4.2 million and you have a 10 million deficit.
"When you are up against a gap like this, 171,000 jobs isn't going to do it," she said.
And then it gets worse from a dig-out perspective.
Say you give yourself a window of three years, to the fall of 2015 to repair the job situation. Figure on 36 months from now, with each month requiring 100,000 jobs to stay even. That's 3.6 million jobs. Add the 10 million deficit and the 3.6 million in stay-even jobs to get 13.6 million. That's how many jobs need to be created to return the nation to pre-recession employment.
Divide that by 13.6 million by 36 months, round it and you need 378,000 jobs a month.
If the nation's payrolls grow at a path of 171,000 jobs a month indefinitely, we'd be keeping up at 100,000 a month, but would have only 71,000 monthly to apply to the 10 million job deficit. At that rate, it would take 141 months -- that's nearly 12 years, until mid 2024, to return us to pre-recession levels.
And the real culprits who did this (well,the lion's share of it) to us are long gone out of office or chillin' in Boca,LaJolla,The Hamptons,etc. on their golden parachutes.A few have formed new firms or gone to work for the survivor banks,sticking us with the arguments and the bill.— red rock- Thanks Dodd and Frank. You wrecked us good.— mephisto
- That sounds about right. You take $1 trillion out of the economy (done through theft - derivatives and phony bundled motgages - this time) it must be replaced. And the American public gets to pay for it. That's a lotta dough which means we ain't getting out of this for a while.— pres
- Wow, your numbers coincide with some Economists who claim the housing boom then bust during the Bush years was associated with approximately 5 million jobs. As we know the housing boom was
created by Wall Street and the failure of Mr Greenspan ( to some extent), the lack of regulation. Compound this with the manufacturing flight to Asia and we will have a job deficit for several years. Without a good war and the financing that goes with it or a new energy policy, like a huge conversion to Natural Gas and renewables, I cannot see how we are ever going to get below a sustained 7% unemployment rate.
— Pete69 - All our good jobs went overseas (or we brought people from overseas here to do them), we make almost nothing, we tax the working people so much it pays not to work while the rich have so many loopholes they pay much less tax then the middleclass. I don't see it ever improving, will probably just get worse.— neddyflanders
- Inexcusable given all the steps that haven't been taken to help the job market. Far left ideology will destroy this country.— Phillies2008WSChamps
