Bad News in Job Losses, But Not as Bad as 1945

Many analysts have been comparing the job losses that occurred in the previous year and have tried to make parallels to the ones that happened more than sixty years ago, but such parallelisms are actually quite unfair. Then again, such an unfair treatment in comparison also leaves some room for the situation to get even worse.

Heed in Your Anxiety: We Are Not There (Yet)

The United States is currently caught in the grip of a really bad recession, but at the moment it is far from being the worse in history. Many headlines have been announcing that now is the worst time ever since 1945 thanks to the January 9 announcement of the Bureau of Labor Statistics that around five hundred and forty two thousand jobs had been lost in the United States economy the previous month, and around two million and six hundred thousand lost for the entire year of 2008. The fact of the matter is, it is quite ridiculous to compare these job losses from the previous year to the ones that were lost around sixty years ago, when the population of the country as well as the economy itself was indeed much smaller.

Facts in Particular

In terms of percentages, the United States had lost around one point nine percent of the total of payroll employment in 2008. This was according to data which was released last January nine. While this is pretty much some bad news, it is actually only the fifth worst figure on their list behind the six point six percent in 1945, the three point four percent in 1949, the two point three percent in 1982 and the two point one percent in 1944. This is also according to the calculations done by Harm Bandholz, who is an economist at the UniCredit Group based in New York. He was also the one who highlighted the heading “worst since 1945” in the research report headline. In a previous note that came before the report of the government, the financial blogger by the name of Barry Ritholtz had warned a lot of people against being tempted to exaggerate this significance that resulted from the December unemployment rates and job losses. He is also quite bearish when it comes to the economy and says that he does not expect to witness some job recoveries this year but rather in the year 2010 as the earliest estimate. Of course, he says that the monthly numbers would definitely not reveal enough to proclaim anything because they fluctuate too much. The best thing to do, is to wait it out while closely monitoring the situation in order to see what is truly happening and what wiser predictions ought to made as a result (without scaring off people with headlines that were mentioned previously).