Alarming New Report: Pre-Recession Unemployment Rates May Not be Reached for a Decade (2021)

Yahoo ^ | 7/19/10

[Libloather]

Alarming New Report: Pre-Recession Unemployment Rates May Not be Reached for a Decade
Mon Jul 19, 3:40 pm ET
WASHINGTON, July 19

**SNIP**

Why: As recent calls for additional stimulus and the extension of unemployment benefits meet with stiff opposition, Congress appears to have underestimated the profound effect of the current recession on the labor market. A new report from the Center for Economic and Policy Research (CEPR), being released by the Jobs for America Now coalition, shows that with a job growth path comparable to the last recovery, the economy will not recover all of the jobs lost in the recession until March 2014. Assuming the trend rate of growth in the labor force, the unemployment rate will not fall back to the pre-recession level until April 2021.

Sen. Al Franken and Rep. Ellison, both co-sponsors of the Senate and House versions of the Local Jobs for America Act, which would preserve or create one million jobs in communities, will talk about the need to adopt this critical piece of legislation. The study, "The Urgent Need for Job Creation," underscores the need for the Local Jobs for America Act and compares various job growth scenarios, of which the most optimistic scenario is not until Sept. 2014.

Jobs for America Now is a campaign of more than 60 groups organizing to put America back to work. For a list of participating organizations visit www.jobs4americanow.org.

[Libloather]

Not to worry - Al Franken is on the case.

[the_Watchman]

Congress appears to have underestimated the profound effect of the current recession on the labor market.

What a bunch of hooey!! Why not admit that Congress appears to have underestimated the profound effect of passing legislation to raise the minimum wage on the labor market. Or Congress appears to have grossly underestimated the chilling effect on the economy that changing the entire health care system would have! Or Congress appears to have grossly underestimated the effects that steeply increasing the national debt would have on money markets, consumer confidence, and banking behavior??

Or Congress appears oblivious to the costs of the threat of unnecessary Cap and Trade legislation hanging over the heads of business leaders and wonders why business refuses to expand!

[correctthought]

Well, I feel relieved then. Looks like I won’t have to work for a decade. !YAY!

/sarcasm

[the_Watchman]

These people who write these articles don’t know from shinola about economics. Who would have guessed that Obama’s “shovel ready” programs were intended to dig a giant hole for the economy! We did!

[Fee]

If the US wants to regain its prowess it needs to do three things, one - shut off immigration except for needed skills, no point having excess workers for few jobs, two - invent something that gives us an advantage and make sure corporate America does not give it to China or India in order to access cheap manufacturing labor, and finally, three - no foreign students should be allowed access to study our latest technological achievements. Where do you think the BRIC nations get the skills to close the technology gap between them and us. I know, free trader/libertarian freepers will say not possible, can’t work. Apparently they never read the story of silk.

[dajeeps]

The 4.5-5.5% range is a little on the low side. Milton Friedman had a theory that if unemployemnt went too low (or below natural rate) that it would become inflationary. It might have has something to do with that inflation spike we had in the 2005-2006 time frame.

A little context goes along way toward setting expectations about what is possible or even likely and I could see it taking 10 years to get back to the 4.6ish in 2005 even under better circumstances.

If congress keeps going to the fiscal stimulus and energetic government trough, I doubt the unemployment rate will budge much lower than 8-9% over that same decade. It will likely get worse before the decade is over due to the fact that we’ll be somewhere in the area of 100% public debt to GDP ratio between 2015 and 2020 and that will bring more economic problems.

These guys just don’t get that their policies are preventing a recovery. Something has to change in the future outlook in order to get the economy moving again, and this congress and this administration has done nothing but take any positive things we had going into 2008 and chip away at them. If the governemnt had managed to correct whatever problems that truly needed correcting, rather than not letting a crisis go to waste, we would have been well on our way to recovery by now.

The depression of 1921 is wonderful example on how the government should handle economic down turns. And the Great Depression is a prime example of what happens when government doesn’t let a crisis go to waste.

[rvoitier]

Muslim and the Moron

SitCom, anyone?

[onona]

There you go, getting all sensible again.....

[onona]

Shinola Ping ! Haven’t heard that since me aud mum passed on God Rest Her Soul.

[rolling_stone]

Keynesian (Kenyan? lol) economics and Socialism, the democrats ideas that are destined to fail. Mentally ill is doing the same thing over and over and expecting a different result. FAIL. Forest Gump was right, stupid is as stupid does.

[onona]

Silk tease ping ! What’s the story morning glory ?

[onona]

I like it ! That one could write itself.

[screaminsunshine]

Or we kick ass an take em out in Nov.

[JohnQ1]

That’s “Franken*stein*,” although it’s pronounced “Fronk-en-steen.” I don’t know what business leaders should do, but I do know one thing they won’t do: invest their assets (and a$$es) while we have delusional psychopathic narcissist in our White House. 2013 can’t come soon enough. I just hope we don’t have to oust him from the WH sooner than that.

[canuck_conservative]

Pre-Recession

aka "The Bush Years"

[dennisw]

I agree with all you said. The whip should should have cracked down years ago with not even allowing Japanese to open up automobile manufacturing plants here. Only a 3rd world country invites in foreign masters to set up manufacturing and for them its a good course of action

But not for us with our GM, Chrysler and Ford

[dixiechick2000]

I don’t think this president or this congress underestimated anything.

Obama doesn’t care about the economy. Nor is he out of touch. He and his minions care only about redistributing our nation’s wealth.

And, they are doing a bang up job of it, while destroying those who make this country wealthy by creating good jobs.

If he’s able to go about this willy nilly for too much longer, he will destroy the middle class.

[dixiechick2000]

BTW, the middle class is what makes this country great, and sets us apart. He’s out to destroy it, even if he doesn’t realize that’s exactly what he’s doing. Given his “experience”, I’m willing to give him the benefit of the doubt on that one. He’s not a pillar in the economic community...only in the organizing community.

Remember when he said, “We are four days away from fundamentally transforming this country”???

[BobP]

...That’s “Franken*stein*,” although it’s pronounced “Fronk-en-steen.” I don’t know what business leaders should do, but I do know one thing they won’t do: invest their assets (and a$$es) while we have delusional psychopathic narcissist in our White House. 2013 can’t come soon enough. I just hope we don’t have to oust him from the WH sooner than that.

Our communist President is going full speed to run America into bankruptcy. But Biden said this was going to be 'recovery summer.' Nothing will improve until Obama is removed from office. Businesses cannot make any moves due to the uncertainties of this administration. The process starts in November 2010. Conservatives must capture at least one house of Congress. Two would be even better. Only in this way will the madness stop. But then Obama will freak and start issuing executive orders like a Caesar and that will cause a Constitutional crisis.

Keynesianism has failed. It's failed so bad in Europe, Greece actually has to start selling portions of it's country! Obama and his morons have spent 2 trillion bucks and we got jack to show for it!

And so, we're in deep, deep economic trouble. And these liberals are going to friggin' sing and dance along, all the way, as they dance off a cliff.

WAKE UP AMERICA!

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[JeanLM]

I agree with you, but would like to point to another factor which may be a more potent force against job creation, and that is the lack of credit in the Fall of 2008, which has persisted until the present.

We probably all agree that most job creation is done best by small business, well small businesses are dying for credit. Like home owners, the value of any assets held in a business have fallen drastically. If you have cash you can get a bank loan, but of course you don’t need it. If you have commercial real estate forget it. Plant and equipment are worth auction values at best. Even receivables are now discounted heavily. You have a business plan with a strong cash flow projection, file it because no one will lend you anything on paper projections.

What happened in 2008 was the severest small business credit crunch I have ever seen, and it hasn’t gotten better.

I had a small business with sales of $70mm a year and 160 union employees. Yes $70mm is a small business these days. We couldn’t get ~ $1mm from our bank in September 2008 and were forced by them into liquidation. Someone bought the business with cash for $2.5mm and now runs it with half the workers making half what we paid and no benefits.

We got no bail out, and frankly, although I would have taken it, we shouldn’t have. That’s how it works.

Until a small business starting or growing can get credit, the jobs numbers won’t come back. With the government borrowing and spending for benefits the country can’t afford, there is no cofidence or money to lend.

P.S. I still haven’t figured out why the financial world stopped back in 2008, but it sure killed a lot of us.