Over the last four days, I've broken the job data down along various lines. All of this data leads to the following conclusion.
1.) During the worst parts of the recession, the economy was losing over 600,000 jobs a month. An analysis of the length of time of unemployment indicates most of these losses have not been recovered as the number of long term unemployed (26 weeks and above) is still near historically high levels. However, the decline in the intermediate length on unemployment (5-26 weeks unemployed) indicates the problem is not getting worse. Put another way, the damage caused by the initial bloodbath is still hurting us, but it's not getting much worse. But that original damage was very bad and is a prime reason for the currently high unemployment rate.
2.) The bursting of the housing bubble is causing tremendous problems. At its worst, total non-farm payrolls dropped by 8.7 million jobs during the Great Recession. Total losses in the construction sector were a little over 2 million or a little over 20%. The dismal state of housing means these jobs will not be coming back anytime soon, which means unemployed construction workers face dim job prospects.
3.) There is a tremendous global realignment occurring in the manufacturing sector right now, as evidenced by the massive drop in employment. Part of this is due to automation in the US and part of this is due to a shift in economic centers of power. As emerging markets develop, it makes more sense to move manufacturing facilities to these developing countries, lowering overall US manufacturing employment. While manufacturing is still important to the US (it has been a primary driver of growth during this expansion) it needs less and less labor -- a trend which will continue.
4.) There is a slow bleed of government workers over the last two years that continues to add to the unemployed and keep initial unemployment claims about 400,000. This slow bleed is not a death knell, but it certainly doesn't help.
5.) The US economy is not creating jobs for those with anything less than a college education in any meaningful way. This is a tremendous problem going forward and, I believe, represents one of the core problems we face going forward.
6.) We're also seeing a drop in the number of people in the labor force as the baby boomers start to retire. I outlined my thoughts on that argument here.
If you're not employed in construction, housing, manufacturing or government and you have a college degree or higher, you should be OK. But, that's a pretty narrow swath of the employed population and explains why the employment situation still sucks.