- by New Deal democrat
A few months ago, Karl Smith of Modeled Behavior showed that there has been a stark bifurcation in the recovery of private sector service employment vs. the complete non-recovery of goods producing and government employment. Even with the generally poor employment reports of the last half a year, that stark difference remains.
First, here is the update of the comparison as of the most recent payrolls report. Blue is private sector service employment, red is manufacturing, construction, and government:
Private sector service employment has almost completely recovered since the recession. While there is no certainty that the trend will continue, if it does the recovery will be complete by early next year. Meanwhile, there has been no recovery at all in goods producing jobs and public sector jobs.
UPDATE: The above graph does not take into account the preliminary benchmark provisions announced by the BLS this morning. Once we take those into account, instead of still being down -770,000 jobs, the private services sector is down only -378,000 jobs, so the entire decline could be reversed by the end of this year.
Unfortunately, even the good news about service sector private jobs doesn't look nearly so good when we adjust for population:
Adjusted for population, there has only been a modest improvement in private sector service jobs, and the hemorrhaging in goods producing and public sector employment has continued relentlessly.
2 comments:
Interesting to think I've been a part of this. In 2009, I lost my grant-funded job at a state university. In 2011, I started a private-sector service job. (During the time in-between, I was unemployed for a while and worked part-time at another grant-funded uni job for a while.)
I don't see myself ever transferring back to the public sector from the private. I know the job I originally held is gone for good. Probably not a huge deal for our state, but a lot of other really important state jobs have been cut, too.
You've shown manufacturing, construction, and government combined into a single curve, presumably because they show similarly negative patterns. How much has continued cuts to the public work force made the job market in the manufacturing and construction group worse given that those cuts resulted in less consumer spending? How much extra would it have cost the country as a whole to have kept these employees working productively (albeit at the cost of deficit spending) versus putting them on unemployment and losing their spending? I imagine these sorts of economic dynamics probably have multiple basins of attraction and possibly chaotic, but is it possible that too cutting public spending too quickly has made the decline in the rest of the economy much worse? Or is it your feeling that this is just a normal part of a economic correction and that the pain was going to be felt at some point?
Thanks
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