Are May’s job-cut numbers a sign of recovery?
The Labor Department reported a drop in job cuts today, making May the fourth straight month that the number of job cuts have decreased. Despite a drop in job cuts at 345,000, the unemployment rate is still at 9.4 percent, the highest in 25 years.
A scene from the Great Depression. Los Angeles Times
While the Great Depression had a more significant unemployment peak of 25 percent in 1933, which rose from 5.5 percent in 1929, if the United States calculated unemployment the same way during the Great Depression, “our unemployment rate would be much higher,” said Henry Blodget on Yahoo Finance.
Here is some information from the Associated Press.
Even with layoffs slowing, companies will be reluctant to hire until they feel certain that economic conditions are improving and that any recovery will last.
Since the recession began in December 2007, the economy has lost a net total of 6 million jobs.
As the recession - which is now the longest since World War II - bites into sales and profits, companies have turned to layoffs and other cost-cutting measures to survive the fallout. Those include holding down workers’ hours and freezing or cutting pay.
Unemployment numbers during the Great Depression didn’t get any worse after they peaked at 25 percent. At that point, the jobless rate slowly began to improve. Could May’s drop in job cuts mean that the economy is already beginning its slow recovery? Has the unemployment rate finally begun stabilizing?
Many experts have said that the recession will get far worse before it gets better. Have we seen in the worse in the past few months or is the worse still to come?
What do these numbers mean to you? Do you see this as a sign that the recession is nearing its end? Or is it a false sense of hope with another big wave of job cuts on its way?
The numbers seem to reflect that the recession may be beginning to slow. Notice I said may be and beginning, because it isn’t done yet and we haven’t hit bottom. Most economists forecasted a 10% rate of unemployment before it was said and done, and we are obviously close to that. They also forecast no positive growth until at least the 4th quarter of this year or 1st quater of next year, and time will tell on that one.
There are some that fear this slowing is due in part to the group of first time home buyers that have entered the housing market now that there are deals aplenty. After they buy there is concern that the recession will pick back up.
All I know is I sure am thankful to St Barack and the Democrat Congress for spending trillions of dollars. Instead of heading for 10% unemployment, bankrupt car companies, and no positive growth in 2009, their spending has us going towards…10% unemployment, bankrupt auto companies, and no positive growth in 2009…nice.
Whoa there on the “economy is recovering” stuff…
Layoffs may have slowed down a bit, but there is a new tool that companies are using to save money, and that is cutting pay rates. I just found out last week that everyone in my company has to take a 5% pay cut. And this is after two rounds of layoffs, suspension of 401K matching and no raises or bonuses in two years.
I am not the only one. I know SO many people who are having their pay cut by their companies. This, of course, will effect them for years to come if they are lucky enough to keep their jobs, considering any raise they may get in the future will be based off of the lower pay grade. And 5% is nothing compared to some people I know who have had to take as much as a 15% paycut. YIKES.
Sorry, but if you look around, most companies are still seeing about a 30% drop in revenue from this time last year. It really hasn’t gotten any better yet, and until that bottom line starts to increase they will find some way to save money. Pay cuts is just the latest round. Who knows what’s next? Furloughs? More Layoffs? God Forbid closing the doors of the company completely? Sorry, but I don’t see much “economic recovery” from where I am standing!
Joey….The current Bush recession is a tool used by employers to intimidate workers into accepting pay-cuts and to put fear in their hearts that their jobs are next. This is nothing new in the world of business management….The current Bush recession also creates an opportunity to find ways to bust unions and slash benefits…Don’t think corporate management isn’t getting outlandish bonuses for slashing wages and benefits. Who needs unions? Try to swim up-river by yourself and see how far you get. You’ll be told to work unpaid overtime.. and if you don’t like it….go find a job in today’s Bush economy. Better yet, I’ll move your job overseas and the Republicans will give me a tax-break!
A prime example is our profit driven healthcare industry. The more claims insurance companies can deny, the greater their year end bonuses. Listen to the insurance executive’s testimony before Congress during the 2007 hearings on healthcare reform….Bush left on a high note. “O.K. guys, now’s your chance to bust labor”! You can thank me later.
By the way…Just had Limbaugh on the radio during lunch.
He’s furious the unemployment numbers are down.
That’s no way to fail Mr. President.
It is a sign that the weather is nicer and allowing people to get out more. Swimming pool and summer places are beginning to open and all of that employs workers.
The real task is to keep money in peoples pockets not just put it there. Everything seems better right now. People tend to get out more and spend more in the summer. The price of gas beginning to rise is only the beginning of the end for a lot of people that were beginning to see light at the end of the tunnel. If you start taking spendable daily cash from pockets just to get them to work and back, we will start right back where we were. I firmly believe that the $4.00 per gallon gas hurt people more than anything.
Garrison,
Um.. Thanks for your concern, but I already work a lot of “unpaid overtime” because I am a salaried employee. Also, the executives in my company are not making huge bonuses. The company I work for is small, under 100 people. I see our company financials every month, and I know that our sales are in fact down over 30%, and I also know that our executives, all 6 of them, have taken the same % of pay cut that we have. In some cases they have taken much more.
Yes, they still make a lot more money than I do, but then again they built the business from the ground up and have run it lovingly for over 25 years, so I guess you could say they deserve to make more than I do. I am just a peon really.
Not everything is a “conspiracy” by the right wing.
They mean the same thing they meant when the press did everything it could to make the economy under the last president look like it was swirling down the toilet when it was in fact growing. — nothing.
The AP is deliberatly distorting the data. Unemployment is not “slowing”. The numbers from March and April were revised downward after initial reports. Their spin is like saying “Good news Capt Smith. Those icebergs on the horizon aren’t massive afterall. They’re just gigantic.”
Unemployment has risen from 7.6% to 9.4 in four months. We will be in double digits in no time with no end in sight and with deficit spending so high it will make recovery very difficult. If anyone remembers the lousy economy the 1970’s, you’re going to like this decade a whole lot less.
But wasn’t the “stimulus”, which the President demanded be passed immediately (then went on vacation for four days before signing)supposed to fix all this? And didn’t the President and Vice Clown go on national TV just a week ago to proclaim success in “creating or saving” a gazillion or so jobs? Every single prediction and claim this administration has made so far has been wrong. The tactic of blaming everything on the previous adminstration has outlived its usefulness. The question we should be asking now is are they really that incompetent or are they doing this deliberatly?
“Unemployment has risen from 7.6% to 9.4 in four months.”—Go_Fish—
This is the reported number. But the REAL number is closer to 20% when you factor in the people who have stopped looking for jobs. There is also the Gen-yers who enjoy their “funemployment” and continue to sponge off of their parents. You know the types, the ones who voted for Obama.
Any “forecast” signs of recovery will be obliterated by the coming credit
“crunch”[you haven't seen anything yet], and the oncoming $100.00/barrel oil prices.
Joey…you work for a company employing less than 100 people. You’re not employed by the multi-billion dollar corporations the Republicans coddle. You’re fishing in the River DePeres looking for a great white…ain’t gonna happen….The company you work for is being devoured by the same conspiracy you claim doesn’t exist. Feel lucky your sales are down only 30%.
We’ve lost a half million jobs a month for the past 9 months. Blaming Obama for the effects of Bushenomics is like blaming Obama for the soldiers we lost in Iraq today.. He voted against funding the Great Haliburton War and is doing everything he can to get us out. Same thing Obama want to do to get us out of this Republican depression.
Fish/Debunk…what’s that famous Republican phrase about lipstick on a pig?
Since it takes a while for news to seep through the sewers under which you live, you must not have heard that as of 11:35 am, January 20, Pres Obama has had the exclusive authority granted to him by the Constitution to withdraw every single US serviceman and woman from Iraq. Using your perverted and emetic form of logic, the blood of those killed and wounded since that moment in time is on his hands alone.
Odious little trolls like Garrison aside, you have to be amazed at the lengths leftists and their mouthpieces in the press have resorted to in order to deflect attention away from this disaster. I think it’s gone beyond mere partisanship. It’s pathological.
Ugh, Garrison, when will you ever learn???
My small company is not being swallowed up by the big, bad corporations. I work at a distributorship, in an industry full of about 22,000 distributors, most run by mom and pops. Actually, my company is in the top 40 in my industry, and we STILL have less than 100 employees.
Plus, in reality, we are losing business to the smaller mom and pop joints because they can run their businesses on razor thin margins because they have such low overhead. A company like mine has employees to pay, benefits, vacation time, etc… Mom and pop don’t have to pay an extra mortgage on a 5000 square foot warehouse. They swoop in to our customer’s at a 13% margin and steal the sale. Usually, we would win based our quality and service level, but people don’t care too much about that right now. Price sells everything these days.
Please leave out personal attacks.