How Bad Is the Recession?

Today's labor statistics for October show the biggest monthly loss of jobs in the US since 1974.

That sounds terrifying until one realizes that the current labor force is around 155 million. In 1974 it was around 92 million.

In other words, the loss of half a million jobs in 1974 meant that a little more than 0.57% of the total workforce became unemployed. Today comparable losses represent less than 0.35%.

Note as well that every time an increase in unemployment is announced, reporters will note that the statistics would have been worse had some folks not left the job market. Such truisms hardly bear repeating, as many such decisions represent people who are nearing retirement or seeking supplemental family income. Of course not all are, but the "discouraged worker" is a trope trotted out by journalists and politicians to inject fear into otherwise ordinary statistical reports.

These are tough times for lots of folks in certain industries and parts of the country. Right now we wouldn't want to be in finance, real estate, construction, automobile manufacturing or any region dependent on those and related industries. But the comparisons to the 70s, let alone the 30s, are still very pale.

Reports of percentage of the workforce unemployed will lag other indicators but still give the best "misery index" available. A scan of this table will show that times right now still aren't as tough as they've been in some people's lifetimes.