The Foreclosure Clouds Darken and Jobs are not Peeping Through
As the foreclosure clouds darken one cannot see any jobs peeping through. Although there is strong talk about recovery of the market the unemployment picture continues to be bleak. A day after the Federal Reserve announced the ‘leveling out’ of the economy, the government released a depressing data about unemployment having reached more than what had been feared and that retail sales too had slightly fallen back.
9 million Americans are receiving unemployment benefits. There are growing figures about the recovery of the market. Henry Farber of Princeton University who focuses on labour said, “I don’t think it’s going to be a jobless recovery. But I don’t see any real signs of a recovery in the labor market yet.”
For the first time after 15 months the rate of jobless fell to 9.4% sparking hopes about the situation taking a turn for the better. But there are gloomy predictions from experts and also the White House that it will go up to 10% before the year comes to a close. Mary Daly of Federal Reserve Bank, San Francisco said, “It’s too early to call it a peak just yet.”
All pundits agree that the growth of jobs always trails behind other economic activities like GDP. In 2001 there was a recession. Job gains started 18 months after recession had ended noted Ken Matheny of Macroeconomic Advisers LLC of St. Louis. But he is more optimistic about the current situation and is expecting jobs to pick up growth one or maximum two months before the year closes. He said, “What we suspect will happen is that this recovery might be kind of sluggish early on, but all in all, it will be a pretty decent recovery, particularly as we get into next year. Next year, we expect a more sustainable recovery and a firmly rising trend for employment.”
But there are many who do not share this view. Lawrence Mishel of Economic Policy Institute, Washington said, “We’re stuck with very high unemployment in spite of the continuing stimulus over the next year. Jobs will continue to decline for many months to come, and unemployment will be rising over the next year or more. I estimate that a third of the workforce will spend some period of time unemployed or underemployed in the next 12 months.”
A private research firm – The Conference Board has come to the conclusion that there will not be any noted growth in jobs during the forthcoming 12 months. For the past three months its indicators reflecting the labour market has been flat.
