The Recession of 2008
Introduction
The recession that began in 20007 is apparently the most profound downturn that affected United States during the post-war era. Possibly, the part that was impacted the most consequent to this as recorded in history is apparently the labour market. This recession negatively affected the United States labour market a fact that was well evident from the sharp curtails in consumer spending. In a more in-depth and insightful way, this paper will explore and elaborate the impacts of the great recession that persisted from December 2007 to June 2009. In essence, this paper will discuss the unemployment, underemployment, and job openings and labor turnover as it relates to the recession in 2007.
Unemployment and Underemployment
Apparently, data recorded in regards to unemployment during the great recession accentuates that the duration of unemployment during this time persistent for quite a considerable amount of time. In addition to the above, the great recession fostered loss of jobs by many people in the United States. In essence, a total of 2.6 million people in 2008 lost their jobs (Elsbyet al 20). The above clearly postulates that the great recession had significant destructive impacts on the labor market. It apparently contributed the worst job decline since the great depression. Based on research findings, it has been established that, the rate of job loss and the consequent impacts during the 2008 recession are underestimated. The above is true because those who had a high paying job during this period and unfortunately lost their jobs are apparently living below their high standards life they lived before the recession. Based on a survey, some people, for instance, who used to work in high paid manufacturing industry, are now working at Wal-Mart as a subordinate.
Consequent to 2008 recession, the growing number of workers seeking full-time job could only find a part-time job. As recorded, the number of those who did a part-time job because they could not find a full-time job. And those whose hours of work had been cut rose to a significant number of about 715,000 people to 8 million. The figure above is apparently the highest that was ever recorded since 1955 (Elsby et al. 31). In regards to the above, those underemployed: that include the part time workers who could not secure fulltime jobs as they wished. And those that had stopped seeking jobs apparently rose to 13.5% from 12.6% in the preceding year (Howell and Bert 223). Apparently, the labour market based on the above scenario was affected negatively in the sense that most workers were found to be unsatisfied with what they acquired from their job in the long run. An overwhelming one in six employees during the great recession as recorded established that he or she was satisfied whole the rest were unsatisfied with the situation in the labour market.
Job shortage
Job shortage during the great situation was apparently palpable. Owing the increasing population of the United States, it is required of this country always to increase the number of jobs at a rate of 100,000 jobs per month. Due to the great recession, United States was unable effectively to meet the job demand (Howell and Bert 239). Based on the statistical records, the United States labour market was required to add a total of 3.4 million jobs. In order for them to keep up the pace with the then increasing population (Elsby et al. 23). Apparently, this created a combined job hole essentially because the job loss was high while the population growth remained elevated. As postulated during the recession, United Sates had to create 300, 000 a month. To fill the gap that had been created by the job hole owing the growing population and loss of jobs (Genda et al. 172). Apparently, job deficit persisted for quite a considerable length of time particularly 2009 and 2010. (Howell and Bert 240) On aggregate, job deficit persisted across many years considering that the government was not able to create the postulated number of jobs anticipated.
Apparently, though the rate of job loss was considerably high, it is of utmost significance to make apparent the fact that some jobs were created though under a low rate. Based on research findings, the rate of job loss by small firms during the great recession was established to be 6%. While the big firm experienced job loss at a rate of 35% (Genda et al. 167).
Job Openings and Labor Turnover
As of December 2008 according to Bureau of Labour Statistics at the time when recession was at its peak. A total of 2.7 million job openings were realized while the job opening rate was at 1.9% in United States (Genda et al. 161). The above is imperative and worth noting essentially because this was established as the lowest point in the 8-year-old series. The hires rate remained unchanged in December 2009 relative to the previous months in 2008. Apparently, job separations or rather the labour turnover rate was higher in December than the previous months. Apparently, 2008 and 2009 are established to be the two years in American economic history hat had the lowest job opening rates, compared to any other year.
Conclusion
The 2008 recession is apparently the most insightful downturn experienced by United States during the postwar era. In essence, the unemployment rates were elevated, the underemployment rates rose, while job shortage remained high. In addition, job openings rate were very low, a fact that curtailed consumer spending.
Works Cited
Elsby, Michael W., Bart Hobijn, and Aysegul Sahin. The labor market in the Great
Recession. No. w15979. National Bureau of Economic Research, 2010.
Genda, Yuji, Ayako Kondo, and Souichi Ohta. "Long-term effects of a recession at labor
market entry in Japan and the United States." Journal of Human Resources 45.1 (2010): 157-196.
Howell, David R., and Bert M. Azizoglu. "Unemployment benefits and work incentives: the
US labour market in the Great Recession." Oxford Review of Economic Policy 27.2 (2011): 221-240.
