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The employment figures released by the Department of Labor today show mixed news for workers. Unemployment fell to 9.7 percent in January 2010 from 10.0 percent in December 2009. Only 20,000 jobs were lost last month, and temporary employment increased, which is a harbinger of future job growth. This slowing of labor market losses, combined with last week’s positive GDP figures, show reasonably strong signs that the economy is starting to recover. That’s the good news.
The bad news is that the same figures show that the economy lost over 1 million more jobs during the recession than previously estimated and that unemployment—especially long-term unemployment—remains at troublingly high levels. More than 14 million Americans are out of work, there are six job seekers for every available job, and 4 in 10 unemployed workers have been pounding the pavement searching for a new job for at least six months, a record level.
The Labor Department’s revisions of employment figures show that the economy shed 8.4 million jobs during the recession, instead of the 7.2 million, as previously estimated. To give a sense of how big this jobs hole is, we would need to create 350,000 jobs per month for the next 24 months just to recover what we have lost since the recession began, and that’s not even compensating for population increases. The United States has sometimes been able to create such high levels of job growth after a recession, but job growth during the most recent economic recovery was much, much slower. After the 2001 recession, it took several years before we saw any consistent job growth and 350,000 were created in only two months of the entire economic cycle.
The mixed news from today’s jobs report continued on many levels, but the overall direction of the labor market is trending up.
Congress is taking action on job creation legislation. And this month’s jobs numbers are a stark reminder that they need to do so quickly. The recovery is just starting to take hold, but we are in much a more massive jobs hole than previously thought and need rapid job creation to get out of it.
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