National Job Losses Continue
CHAPEL HILL (January 8, 2010) – New national employment data for December show that the economy shed 85,000 more positions than it created. Since the recession’s onset in December 2007, over 7 million positions have been eliminated with net job losses occurring in 22 of the last 23 months. Over the past two years, the unemployment rate has risen to 10 percent, and the number of unemployed persons nearly has doubled.
“December brought no good news for working Americans,” said John Quinterno, a principal at South by North Strategies, Ltd., a research firm specializing in economic and social policy. “Job losses occurred at a level that is severe by any objective standard, and revisions to previous months’ data showed the total job gap to be larger than first estimated.”
In December, the nation’s employers eliminated 85,000 more payroll positions than they added. Although the November payroll data were revised upward (to +4,000 positions from -11,000), downward revisions to the October data more than offset the gains. Additional downward revisions are expected when annual data adjustments are released in February.
December job losses were concentrated in the construction (-53,000), trade/transportation/utilities (-37,000), and manufacturing (-27,000) sectors. These and other losses were offset primarily by gains in professional and business services (+50,000) and education/health care (+35,000). Much of the increase in professional services employment was driven by the temporary help services sub-industry (+46,500).
“There is little positive news in the December employment report,” notes Quinterno. “Although job losses are no longer occurring at the dizzying pace experienced in early 2009, less bed is not the same as getting better. Many Americans simply have been forced to the economy’s sidelines.”
The extent of idle labor is reflected in the household data released today. In December, 15.3 million Americans – 10 percent of the labor force – were jobless and actively seeking work. Proportionally more adult male workers were unemployed than female ones (10.2 percent vs. 8.2 percent). Similarly, unemployment rates were higher among Black (16.2 percent) and Hispanic workers (12.9 percent) than among White ones (9 percent).
“In December, just 58 percent of America’s working-age population was employed,” adds Quinterno. “Individuals looking for work are finding it increasingly difficult to obtain positions, and last month, 40 percent of all unemployed workers had been out of work for at least six months. Because the number of job seekers far exceeds the number of job openings, many more individuals simply have given up on finding work. Counting those individuals would bring the underemployment rate to 17.3 percent.”
Today’s national data suggest that another weak employment report is in store for North Carolina. Since the recession’s start, North Carolina employers have eliminated, on net, 250,000 positions, and the statewide unemployment rate has climbed to 10.8 percent.
“In recent months, job losses and unemployment have settled at extremely high levels,” observes Quinterno. “Given that 70 percent of the nation’s economic output is dependent upon consumer expenditures, high levels of joblessness only serve as a drag on growth. Alarmingly, the one major positive contributor to growth in recent quarters – federal recovery spending – likely has achieved its maximum effect on growth rates and will begin phasing out in 2010.
“Because little private activity appears ready, willing, and able to replace public-sector spending and consumption as drivers of growth, high levels of jobless and sluggish growth look to continue well into the future,” cautions Quinterno.