Coming up: 12% unemployment

James Pethokoukis explains 12 reasons unemployment is going to (at least) 12 percent.

Read the whole list, but pay particular attention to items 6-9:

6. The number of permanent job losses this cycle (unemployed but not for temporary purposes) increased by a record 6.2 million. In fact, well over half of the total unemployment pool of 15.7 million was generated just in this past recession alone. A record 5.6 million people have been unemployed for at least six months (this number rarely gets above two million in a normal downturn) which is nearly a 36% share of the jobless ranks (again, this rarely gets above 20%). Both the median (18.7 weeks) and average (26.9 weeks) duration of unemployment have risen to all-time highs.

7. The longer it takes for these folks to find employment (and now they can go on the government benefit list for up to two years) the more difficult it is going to be to retrain them in the future when labour demand does begin to pick up.

8. Not only that, but we have a youth unemployment rate now approaching a record 20%. Again, this is going to prove to be very problematic for employers in the future who are going to be looking for skills and experience when the boomers finally do begin to retire.

9. The gap between the U6 and the official U3 rate is at a record 7.3 percentage points. Normally this spread is between 3-4 percentage points and ultimately we will see a reversion to the mean, to some unhappy middle where the U6 may be closer to 15.0-16.0% and the posted jobless rate closer to 12%. This will undoubtedly be a major political issue, especially in the context of a mid-term elections and the GOP starting to gain some electoral ground.

Those are depression-era numbers. Dale Franks points out that

if we currently reported the unemployment rate as they did in the 1930’s, our current rate of unemployment would be around 17.2%

Of course, these numbers don’t account for the effect a job-killer bill like Cap and Trade, or the costs of the healthcare bill would have on the economy.

How’s all that hope and change working for you now?

Link also at Instapundit

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5 Responses to “Coming up: 12% unemployment”

  1. Obloodyhell Says:

    > How’s all that hope and change working for you now?

    As someone else once pointed out —
    “Hope and Change” was misheard in the speech due to a microphone problem. What he actually said he offered was “Rope and Chains”.

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  4. Pete Murphy Says:

    Unemployment, both in the U.S. and the world as a whole, marches ever higher because the field of economics doesn’t account for the relationship between population density and per capita consumption.

    Following the beating the field of economics took over the seeming failure of Malthus’ theory, economists adamantly refuse to ever again consider the effects of population growth. If they did, they might come to understand that once an optimum population density is breached, further over-crowding begins to erode per capita consumption and, consequently, per capita employment.

    And these effects of an excessive population density are actually imported when a nation like the U.S. attempts to trade freely with other nations much more densely populated – nations like China, Japan, Germany, Korea and a host of others. The result is an automatic trade deficit and loss of jobs – tantamount to economic suicide.

    Using 2006 data, an in-depth analysis reveals that, of our top twenty per capita trade deficits in manufactured goods (the trade deficit divided by the population of the country in question), eighteen are with nations much more densely populated than our own. Even more revealing, if the nations of the world are divided equally around the median population density, the U.S. had a trade surplus in manufactured goods of $17 billion with the half of nations below the median population density. With the half above the median, we had a $480 billion deficit!

    If you‘re interested in learning more about this important new economic theory, then I invite you to visit either of my web sites at OpenWindowPublishingCo.com or PeteMurphy.wordpress.com where you can read the preface, join in the blog discussion and, of course, buy the book if you like. (It’s also available at Amazon.com.)

    Pete Murphy
    Author, “Five Short Blasts”

  5. Ashley St.Claire Says:

    Thanksgiving-2009

    November 26, 2009 by politicalsnapshots.wordpress.com

    Thanksgiving-2009

    We are far removed from the days of Native Americans celebrating harvest festivals. It has also been hundreds of years since the English colonists celebrated thanksgiving as part of their religion or giving thanks to Native Americans. In 2009, we still celebrate the day even though some Americans are more thankful than others.

    American banks, who have received the biggest chunk of the $787 billion stimulus money, have been well greased and highly stimulated. They should be very thankful to their government who had made it possible for them to prosper more, and continue to widen the gap between the haves and the have-nots in to a higher level.

    To millions of average Americans this Thanksgiving Day is a day of unemployment, lack of insurance coverage, inability to pay mortgages and a day of stress like any other. According to the U.S. Bureau of Labor Statistics, the unemployment rate rose to 10.2 percent in October. That is an increase of 558,000 persons out of work. Bringing the” official” unemployment total number to 15.7 million Americans. What a dazzling result of the stimulus package. Really. What a recovery.

    On this Thanksgiving Day, could the White House tell us who the genius is that came up with “jobs saved or created” nonsense? It is easy to philosophize in the comfort of the White House, and come up with totally unverifiable numbers that do not stand simple scrutiny. What a joke. The reality is to be on line for hours looking for non-existing jobs. Reality is to lose a job. The reality is to be unable to pay your bills.

    Let’s hope, next year’s Thanksgiving will be a real “Thanksgiving” to those who are unable to make ends meet.

    Professor Mekonen Haddis