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KAI RYSSDAL: What we have here is another one of those on-the-one-hand-on-the-other-hand economic reports. The August unemployment report hit the streets this morning. The jobless rate jumped again last month from 9.4 to 9.7 percent.
Now for the other hand. The number of jobs lost — 216,000, as I mentioned — while sizeable, is the smallest we’ve had in a year. So balancing it out. Bad? Good? It’s hard to tell, really. We haven’t seen a healthy job market in so long we may have trouble remembering what one is supposed to look like.
Marketplace’s Mitchell Hartman reports.
Hartman: Losing more than 200,000 jobs may not seek like the road to recovery, until you consider what a long, awful trip it’s been, says Lawrence Mishel of the Economic Policy Institute.
Lawrence Mishel: The job losses are about a third of what they were earlier this year. Although it’d be much better to see fast job growth and rapidly falling unemployment.
And Mishel knows how many new jobs would be required.
Mishel: We need to be able to have 127,000 jobs a month created, before we see unemployment start to fall.
Let’s call that “normal” job growth — the economy absorbing all the new people entering the labor market every month: high school and college graduates, immigrants, stay-at-home moms who aren’t staying home anymore. For that to happen, companies first have to stop laying people off. Then, they have to gain enough confidence in the economy to take the risk of hiring again.
Mishel and other economists think it’ll be mid-2010 before “normal” job growth like that returns.
Bernard Baumohl is with the Economic Outlook Group.
Bernard Baumohl: It’s going to take us a really long time to bring back the seven million jobs that have been lost since the start of this recession. My guess is, four to five years.
Baumohl says changes in the economy have shrunk some industries permanently: think automaking, financial services, residential and commercial construction. He says some of those jobs are probably never coming back.
I’m Mitchell Hartman for Marketplace.