The most recent jobs report seemed dismal, but some perspective is needed, says the ubiquitous John Challenger in the Christian Science Monitor. The most recent trend of job losses is nothing compared to what we saw in 2001, and could indicate a relatively mild slowdown:
After three months of negative job growth, the economy has seen a net loss of 232,000 jobs, far fewer than the 355,000 lost between March 2001 and May 2001, the first three months of the last recession, which was considered mild by historical standards. Even at its worst point, that recession saw unemployment peak at 6.3 per cent, still relatively low compared with previous recessions.
Companies could be particularly well-positioned during this slowdown to preserve high employment levels. The reason? This period of growth didn’t include the kind of hiring bubble that’s beset previous booms. In the four years leading up to the 2001 recession, US payrolls grew by an average of 239,000 jobs each month, as the excesses of the dotcom boom led to extensive hiring across all industries. With a few notable exceptions in the financial sector, it appears that employers learned their lesson from that period and resisted the urge to hire “any warm body,” even when the housing market seemed unsinkable. In the four years preceding this slowdown, monthly job gains averaged 163,000.
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