Earn What You Spend

Last week the Bureau of Labor Statistics announced that the unemployment rate has now hit 8.5% -  so far in this recession the economy has shed over 5.1 million jobs.  We all have friends, family and colleagues who are affected by these job losses.  It’s an incredibly tough thing to watch. 

The standard saying is that we’re facing the worst economic crisis since the Great Depression - and despite what might have been a bit of hyperbole at the outset, this is increasingly corroborated by the dreadful indicators we see all around us.

How do the current job losses compare to those of the Great Depression?  Justin Fox takes a look: 

Source: Curious Capitalist 

In this graph, Fox shows the decline in non-farm employment as a percentage of the overall work force, as calculated by Sebastian Dartevelle.  Fox notes “the pace of job losses in the first 16 months of the Depression appears to be about twice as fast as in the first 16 months of this recession.”

So yes, things are certainly bad - but the pace of the decline does seem to be stabalizing, and we’re no where near Great Depression levels.  And with the stimulus bill expected to take economic effect in the coming months, let’s hope this is as bleak as things will get.