March 5, 2010
Today’s jobs report confirms that most industries are no longer shedding jobs, but growth remains centered in temporary help services, education and health care. Although the official unemployment rate remained at 9.7 percent, the broadest measure of unemployment increased from 16.5 to 16.8 percent because of the large increase in people working part-time for economic reasons. According to Mark Wilson, principal at Applied Economic Strategies, “The pace of layoffs has slowed dramatically, but hiring has not picked up in many industries. Although manufacturing is showing some signs of life, outside of employment services and health care, employers are still reluctant to hire.” Recent surveys report that business restructuring has driven productivity gains to a record post-1945 high and reduced labor costs by 4.7 percent last year – the largest decrease since the data began in 1948. When job growth does resume, it will take 4.5 years to make up for all of the jobs lost during the recession provided employment grows by 157,000 jobs per month (the average monthly gain from 2005 to 2007). According to the Bureau of Labor Statistics, the industries with the largest number of job openings are professional and business services, health and social assistance, and state and local government (see Chart below). Notably, manufacturing has 173,000 job openings.