11 Million Job Buffer From Efficiency And Part Time Workers Before Even 1 Person Needs To Be Rehired

[BR_Parkway]

11 Million Job Buffer From Efficiency And Part Time Workers Before Even One Person Needs To Be Rehired
http://www.zerohedge.com/article/11-million-job-buffer-efficiency-and-part-time-workers-even-one-person-needs-be-rehired

A startling observation out of David Rosenberg is that with the current unemployment number (whatever it may be: 10.2%, 17.5%, 90%), even assuming an end to workforce outflows, there is a buffer equivalent to almost 11 million people, consisting of increased worker productivity and massive newly-created temporary positions, that can be drawn upon before even one person of those laid off recently, has to be rehired. This is disastrous for the Obama administration, especially at a time when it is actively speculating on Stimulus #2 in order to spur any kind of job creation ahead of mid-term elections.

We haven’t yet hit bottom on employment but that will happen at some point. Employment is not going to zero, of that we can assure you. But when we do start to see the economic clouds part in a more decisive fashion, what are employers likely to do first? Well, naturally they will begin to boost the workweek and just getting back to pre-recession levels would be the same as hiring more than two million people. Then there are the record number of people who got furloughed into part-time work and again, they total over nine million, and these folks are not counted as unemployed even if they are working considerably fewer days than they were before the credit crunch began.

So the business sector has a vast pool of resources to draw from before they start tapping into the ranks of the unemployed or the typical 100,000-125,000 new entrants into the labour force when the economy turns the corner. Hence the unemployment rate is going to very likely be making new highs long after the recession is over — perhaps even years.

But to consider the upward inflection point is pretty moot: after all, second derivatives in the jobless picture are accelerating in the wrong direction. How much longer, before one can hope to see even one positive employment read?

The recession ended in November 2001 with an unemployment rate at 5.5% and yet the unemployment rate did not peak until June 2003, at 6.3%. The recession ended in March 1991 when the jobless rate was 6.8% and it did not peak until June 1992, at 7.8%. In both cases, the unemployment rate peaked well more than a year after the recession technically ended. The 2001 cycle was a tech capital stock deflation; the 1991 cycle was the Savings & Loan debacle; this past cycle was an asset deflation and credit collapse of epic proportions. And economists think that the unemployment rate is in the process of cresting now? Just remember it is the same consensus community that predicted at the beginning of 2008 that the jobless rate would peak out below 6% this cycle. Thanks for coming out.

[librechik]

1. Only the government can create jobs out of nothing.

why aren't they doing their job? Because they have decided it is not their job, and that "socialism" is a hard label to run on in an American election.

The propogandists have won. We are no longer the US of our e pluribus unum heritage. So long, citizen. You are on your own.

[cutlassmama]

2. scary shit.