During the last business cycle (the recession was in March-Nov 2001), total non-farm private employment fell from a peak of 111.681 million in December 2000 to a trough of 108.231 million in July 2003.
In other words, from peak to trough during the last business cycle, the “economy” “shed” 3.45 million jobs (or 3.1% of employment). I put those terms in quotes because there is no such living being as “Mr. Economy” (with the exceptions of Barney Frank, Chris Dodd, Hank Paulson, Ben Bernanke perhaps) but even more so it does not mean new jobs were not created, it means 3.45 million MORE jobs were lost than were created over that time period.
From peak to the most recent employment reading, total non-farm private employment has fallen from a peak of 115.759 last November to the most recent 114.776 in September. Thus, so far during this crisis, the economy has “shed” a total of 983,000 jobs, or 0.85% of employment. Is this grounds for optimism, fear or something else. On the one hand, if you think that employment must fall for as long and as deep as during the 2001 recession (and beyond), then we have barely even scratched the surface. On the other hand, we have seen only a minuscule drop of employment thusfar and this is happening during what has been called more than once, “The Most Serious Economic Crisis Since the Great Depression.” For more optimism, I am comparing these current declines with the 2001 recession that many people regard as one of the mildest recessions in American history.
For a point of comparison, from peak to trough during the 1973-75 recession, employment fell from 64.363 million in June 1974 to 61.735 just 12 months later … a fall of 2.63 million (or 4.1%) in less time that had passed since the onset of the current crisis.
