2.6 Million Jobs Were Lost in 2008

The news is bad, even a little worse than we expected:

NEW YORK (CNNMoney.com) — Another sobering government labor report released Friday showed the economy lost 524,000 jobs in December, bringing 2008’s total job loss to just below 2.6 million.

Last year’s steep drop in employment marked the highest yearly job-loss total since 1945, the year in which World War II ended.

Economists surveyed by Briefing.com had forecast a loss of 525,000 jobs in the month.

According to the Labor Department’s monthly jobs report, the unemployment rate rose to 7.2% last month from 6.7% in November and higher than economists’ forecasts of 7%.

And with October and November job numbers revised downward by 320,000 and 51,000, respectively, we’ve effectively lost 895,000 more jobs with just the new news in yesterday’s report (524K + 320K + 51K).

That 2.6 million jobs have been lost in all of 2008 for all of the economy is startling, but that’s a reduction in total jobs (private plus government) of “just” 1.9 percent. It’s a much more distressing story when you dial down to what’s happened to private-sector jobs, manufacturing jobs, and auto industry jobs:

• Total private-sector jobs fell by 2.77 million in 2008, or a decline of 2.4 percent;
• total manufacturing jobs fell by 791,000 in 2008, or a decline of 5.7 percent;
• total production jobs in manufacturing fell by 712,000 in 2008, or a decline of 7.2 percent;
• and total auto manufacturing jobs (motor vehicles and parts) fell by 161,500 in 2008–a 16.8 percent decline (from 962,600 jobs in December 2007 to just 801,100 jobs in December 2008).

Here a link to the December 2008 employment report from the Bureau of Labor Statistics, and to the historical data I used for the above calculations.

Comments

[Ricard:]

Interesting. From your emphasis, I'd guess that you have some sort of bias against our service-sector-led economy. Fair enough, I would agree too.

However, what is the solution? Clearly manufacturing is on orders of magnitude cheaper in places where labor (one of the key components of capital) are 1/20 the cost of what they are here. Even service sector components are being outsourced these days.

Are you advocating an across the board tariff? If not, then what? Do we demand tribute from states, else have them suffer military consequences? Who would then be our allies? Do we ban any transfer of technology to other countries which may use it to compete with us economically? How would such a ban be implemented? Or, do we suck it up, and wait for the world to reach our standard of living, and risk whatever political and military ramifications such a rise to parity would cause? That *would* further lift most of the world from poverty, but what if it also caused renewed aggression caused by strengthening economics in states not completely aligned with our interests?

I'm not exactly sure what you advocate, other than that the news is not good. My only point to add is that coming up with a solution may be even harder to swallow.

Jan 10 07:17 PM

[Crocodilian:]

One thing that I haven't seen addressed is the enormous revisions that these numbers seem to invariably have.

How can a number be %50 off?

We have "revisions" of 370,000 jobs lost in just two months . . . I am not sure of how to interpret numbers which change, retrospectively, so much.

Jan 10 08:55 PM