Roubini: Many Jobs Gone Forever
“Conditions in the U.S. labor markets are awful and worsening,” writes Nouriel Roubini in The New York Daily News.
“While the official unemployment rate is already 10.2 percent and another 200,000 jobs were lost in October, when you include discouraged workers and partially employed workers the figure is a whopping 17.5 percent.”
“Remember: The last recession ended in November 2001, but job losses continued for more than a year and half until June of 2003; ditto for the 1990-91 recession,” writes Roubini.
“That fall in hours worked is equivalent to another 3 million full time jobs lost on top of the 7.5 million jobs formally lost,” writes Roubini.
“This is very bad news but we must face facts. Many of the lost jobs are gone forever, including construction jobs, finance jobs and manufacturing jobs.”
1 comment:
More than 10 states are now in danger of issuing IOU's.
Lets take NY State as an example as an example for my argument. Patterson urged the state for 3.5 billion in midyear cuts. By the end of the year, the deficit will be 9-10 billion. In 2010, the deficit could be 20 billion.
A cut of $250,000,000+ from the department of education would be 3000+ jobs (based on an average salary of $75,000).
Of course, I am a teacher..however, I would like to think that I try to think of the situation outside the union/private clash of realms.
So, lets consider that on this $75,000 level, the state needs to cut 10 billion dollars; this translates to 120,000 lost jobs. Double the deficit to 20 billion, and this is 250,000 jobs. Lets now consider that the average civil servant salary is maybe at best %75 of an average NYC teacher, you might be nearing 400,000 lost jobs.
Can you imagine this on a national level, or even just considering California, Florida, and Michigan by itself?
I would not consider this a bubble, rather I would consider it more like falling off of the Hindu Kush.
Only a few things could slow this down, and further exacerbate the situation;
1) More stimulus plans and money printing
2) Market manipulation
If reality takes it course (which it should because the current policy making is blighting our economy), there will be such major consequences that it will not only destroy families, but lead to social disorder and other societal complications.
Think of what the destruction of socialized middle-class stable jobs will do to the economy?
Let me end by saying that the bailout, and especially those of banks was the biggest scam in the history of mankind. In a democracy, failed institutions are not arbitrarily propped up and saved by the state. They file bankruptcy, and new business burgeon as a result of another's mistake.
And yet, banks are too big to fail, yet many still failed after the stimulus (or still cut back)..and if the bank failures were such a threat to the people who had money in these institutions, why can the treasury provide emergency coverage of 250 billion dollars?
Yes, maybe the result would've been painful. However, it is one of these amazing points in modern history which will wind up being a massive catastrophe in the making in our future history books.
At this point, there is no way of ameliorating the situation to the point where we see real growth and true reduction in our deficit. All we can do is stop printing and manipulating and face our destiny sooner, or manipulate and face something is worse than than the worst.
Pretty scary!
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