Floyd Norris can see a few trees, but he's still missing the forest.
When the July employment numbers are released today, the Bush administration will hail them as proof that the economy is doing well, and it will have a point [oops! --ed.]. But despite rapid job growth this year, many Americans continue to believe there is a job crisis.Yes, "experienced" -- i.e. older -- workers have really taken it on the chin in this recovery/recession; point well taken. Yet recall that since the Jobs Elimination Express came to a halt in August 2003, the US economy has only added 273,000 jobs above what is necessary to simply keep up with population growth. And not only that, all the 'extra' growth came in a short hiring burst over just three months this spring (March-May). When it comes to jobs, this economy sucks. When it comes to good jobs, this economy wicked sucks.
Why is that? Some blame an overly negative press, but the real answer may be found by delving into the statistics. New numbers from the Labor Department show that the job downturn of 2001 and 2002 was surprisingly damaging to experienced workers, particularly older ones.
. . . by early 2004 - after anyone laid off in 2001 or 2002 had had more than a year to find work - many long-tenured workers who lost jobs in the downturn were still suffering. During 2001 and 2002, tenured workers were more likely to lose their jobs than in any downturn since 1981-82, when the unemployment rate hit 10.8 percent. And those who found new jobs took bigger pay cuts - an average of 18.7 percent - than in the past.
It used to be that even among experienced workers, the age group most likely to suffer in a downturn was workers who were 25 to 34 years old. It's never fun to lose a job, but the young are more likely to be resilient and less likely to have family responsibilities. Over all, young workers were still most likely to lose jobs in the last downturn. But among workers with at least three years on the job, the most vulnerable workers were those 55 to 64.
Of those experienced workers who lost their jobs in 2001-2, 36.1 percent stayed out of work so long that they exhausted their unemployment benefits. That number is much higher than in the 1990-91 downturn.
. . . the bad experience helps to explain current perceptions. The Conference Board asks people every month whether jobs are plentiful or hard to get. The jobless rate now is almost exactly where it was in the summer of 1996, when Bill Clinton was cruising to re-election, but the public's view of the job picture today is far more negative.
Those tenured workers who suffered in the downturn - and their friends - still feel the pain.