The Black Hole of Jobless in America

EconMatters's picture

By EconMatters

June employment report from the BLS said the economy added 80,000 jobs (+84,000 in private sectors, -4,000 in government jobs) in June.  The unemployment rate is unchanged at 8.2% from May, while the U-6 under-employment rate rose 0.1% from May to 14.9% (in 2007, the rate was 8%).  The jobless rate has stuck above 8% for over three years since February 2009, the longest such stretch on record since 1948. 

Even though the total employed jumped by 128,000, the jobless rate remained the same, partly because the labor force increased by a larger 189,000.   That is not a good sign when the labor force is growing faster than job growth, as it suggests the unemployment rate could hit higher if the trend continues.  Out of the total unemployed, 41.9% or 5.4 million is trapped in the long-term unemployed category (jobless for 27 weeks and over), while growth in private payrolls was the weakest in 10 months.

New Jobs in the USA (Sept. 2008 to June 2012)


Chart Source:


The better news is that the jobless picture, while still gloomy, at least seems holding steady and not deteriorating.  The bad new is that don't expect we can dig out of this unemployment hole any time soon either.  

At an April 25 press conference, Fed Chairman Bernanke said about 100,000 a month job growth is needed just to stabilize the jobless rate, while 150,000 to 200,000 a month of new jobs are needed to reduce it.  The latest estimation from the CBO (Congressional Budget Office) implies that roughly 90,000 jobs a month is needed to keep up with the projected population growth--the underlying rate of labor force growth is now just 0.7% annually.  

According to economist Carmen Reinhart, the post-crisis weak period usually lasts as long as the boom that preceded it. The U.S. housing boom lasted 7 years (prices doubled from 2000-2007), which means the job market will also remain unhealthy until 2016, 7 years after the Great Recession officially ended in June 2009.

The more sobering view comes from the Brookings Institution.  As of June, the U.S. faces a “jobs gap” of 11.3 million jobs since the start of the Great Recession in December 2007. Under the assumption of 208,000 new jobs per month, it will take until June 2020 – or eight years – to close the jobs gap.  At 321,000 jobs per month, the economy will reach pre-recession employment levels by August 2016.  (See Chart Below).   

The reality is that regardless which estimate you go by, the current job creation trend still falls short--from April through June, the economy produced an average of just 75,000 jobs a month.   

Furthermore, in addition to high national debt, the U.S. would have more than $600 billion in higher taxes and reductions in defense and other government programs starting in 2013 if the Congress fails to resolve the "financial cliff".  Europe is facing its own "financial cliff" with sovereign debt crisis raging in several Euro countries, while China is also experiencing a significant slowdown, if not an outright recession.  

With this high degree of global uncertainty, companies most likely will put off adding permanent positions, and maintain status-quo by either asking existing employees to work longer hours, or hire temporary workers to keep the business going.      

The Great Recession and the poor job market in the past five years has stressed the middle class to the limit. The weakening economic outlook has partly prompted the Federal Reserve to expand its Operation Twist by $267 billion till the end of 2012.  Based on the recent language from the Fed, QE3 could be coming as well.  However, the seeds have long been sown from the poor fiscal and monetary policy implementation by the government.  The president's 2009 stimulus program, and Fed's two rounds of QE have gone to either big banks or non-essential special purpose projects, with very little to where it'd matter in terms of jobs.   

Right now, it looks like President Obama likely will get re-elected unless things start deteriorating fast and significantly (That's more a poor reflection of the current viable presidential candidates, instead of an endorsement of the current Administration.)  So that means we probably should not expect much difference even with a QE3 or an Obama stimulus 2.0 after five years into the black hole of jobless.       

Further Reading - Forget QE3, America Needs a Real Job and Road Stimulus  


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batterycharged's picture

Wait, isn't this what all the free market people want?

Free trade every where? Cheap labor abound! Money in the best hands (the wealthy and few)?

This is what happens in an unabated free market. You get several rich, many more poor and a whole lot of debt to discourage mass revolution.

The reality is that we need gov't intervention, and I don't mean the bank-backed Fed printing more money for...the wealthy. And I don't necessarily mean more food stamps.


shuckster's picture

Jews control 72  seats in the Senate. Yet no Jews go to jail. What is with the assymetrical representation?

Everybodys All American's picture

I don't buy that Obama is going to be re-elected ... not unless he and his cronies stuff the ballot box from Chicago.

Ok ... there is a chance.

covert's picture

the elections are rigged and so pointless. the usa is a dictatorship and this will become more obvious in the future.

PulpCutter's picture

Where are the TAX RETURNS, Romney!?

laomei's picture

The other stat being (conveniently) ignored is the massive rise of "disability".  Funny how that number shot way up when unemployment benefits ran out.  Fairly certain that they don't even count towards the labor force number anymore, thus allowing for more stat juking.  The payout's basically the same as unemployment, and there is no real limit to it that I'm aware of.  So for millions it's just been the obvious "short term" solution.

MFL8240's picture

With this sort of report card, the American saps would consider putting this clown in for another 4 years?  It is astonishing to me to believe such ignorance still prevails.

rsnoble's picture

I don't buy the fact the great recession ended in 2009.  Perhaps job losses slowed down, but trillions have been thrown at the problem with little result.

Funny how know one takes that into account.  We're in a modern day depression imo, and another slowdown in that.

Also, the clowns assuming 208,000 jobs per month are in la la land.  That's like the union bosses telling everyone is fine and dandy when they have 25% unemployment and yet need full unemployment and 10% returns to fully fund pensions. Yet everything is ok?

Things are so bad..........everyone is either overly optimistic because they are stupid and/or they are flat out lieing.

Oh and let's not forget all of the little war projects and what they could turn into.  

Last but not least SP 450 would certainly cool hiring moods.  Don't laugh, without the massive Fed intervention we'd already be there and it's still a huge magnet that requires manipulation to no end this day.


overmedicatedundersexed's picture

rsnoble funny..the trillions you write about did what they were intended: to keep the NWO elite solvent, if you think they were to heal the economy of any country well see my other posts on brain washing.

Snakeeyes's picture

The Obama Administration and Democrats have increased dependency rather than unblocking job creation. They are Socialists are care more about the environment and regulations than job creation. Simple.

forrestdweller's picture

a clear case of primitive thinking. there are only good and bad, right and wrong.

probably a fan of mr. Bush.

BeetleBailey's picture

I can spot an Obama throne licker a mile away.

Can't you douchebags stand on your own two feet and take blame like adults - or do you have to - MUST YOU - blame Bush each and every tyime.


I laugh at the poor dumb bastards that have to use others to blame for their own shortcomings.

Obama's a cunt. Politicians - by definition - are cunts. Lying cunts. Obama needs to man up; something the cunt has never done his entire life. Bush went along with these cunts in Congress and signed all the shit they put on his desk. Plus, the bastard and his own Veep - Dickless Chainsaw, started a fucking war for the MIC.

Until we the people hold these cunts responsible for ALLLLLLLLL their actions, and demand REAL change - the same shit will get spewed at us.

Political hacks know better than to confront me; I leave them bleeding in the gutter.


forrestdweller's picture

you don't know your ass from a hole in the ground.

and you seem to be obsessed with genitals. could be a case of sexual frustration.

BeetleBailey's picture

Sure I do. My ass is attached to me, and their are several holes in the ground outside.

Obsessed with genitals? No, that would be you; obsessed with political douchebags that lie from birth.

overmedicatedundersexed's picture

the power to brain wash a population has so many more tools than in the past. If Hitler had the same tech we would all be speaking german.

there are simple solutions to the problems America has. it is of course constantly repeated that these problems are not solvable, too complex, too many people for the jobs available , or the funny one about running outta energy.

no the unstated problem is: the current corrupt elite's wealth and power cannot be maintained and also solve the economic and social problems of America.

The elite must pay for their wealth and blood before the system can restore balance here in America.

the rest of the world is not our problem is the first thing to understand.

AnAnonymous's picture

in US citizenism, the King class is the US citizen middle class.

forrestdweller's picture

the real global problem is overpopulation. most of the bog problems in the world can be brought back to this fact.

the human population has grown to fast en is now to big for our global economic system. a part of the population falls out off the system, and there will be increasingly more people dropping out of the system.

from a biologist's perspective, it's is very clear what is going to happen the next decades.

shuckster's picture

Overpopulation is subjective. How many are too many people? The world was filled with war and violence and struggle when there were only 7 million people. Now it's filled with those that there are 7 billion... War is the old solution to over population, and it works quite nicely. I say we need more of it, not less

AnAnonymous's picture

The US citizen population is too big for the world to sustain.

BlackholeDivestment's picture

...if you buy sell or trade the black hole, it's not as bad as if you provide labor for it. In that case you polish the bullet in the Suicide Vampire Squids gun. With the New World Order Global Borderless Claim of Dominion above freedom and independence, the New Secular Socialism of Rosemary's Baby Care is a universal tax and another mark of the beast from which not even idle hands can escape. The seal of Contempt is now upon all Americans. Americans are in the black hole and the only way out is through civil war against the SkyNet rise of the machines or rapture. This is just a fact that nobody can deny. Americans are stupid and pathetic fools, hell bound, and there are not enough real Christians to preserve the spirit of the Constitution. It is time for judgment to come upon the nation, as it now stands in contempt and equally yoked among all nations. 

Time to die ...bitchez ...and time for the 1% and the 99% to perish that have rejected the risen mercy. Haa haaa haaa haaa, black hole bitchez. Aaah haa haa haa.

silverdragon's picture

The best solution for those that can travel overseas is to find work overseas. Hundreds of thousands of Americans are doing it already. While you are overseas top up on Gold and Silver and when everything resets go back to the US and your Gold and Silver will get you serious buying power as the dollar will have devalued to brass Razoos.

TheObsoleteMan's picture

The jobs that created the american middle class as we have known it, have either been replaced by technology or have been outsourced to foreign labor NEVER to return. In fact, the last of the hold outs will be gone within the next 5-10 years. This country will then resemble a third world country {with leadership and debts to match}. In many ways, it allready does. Globally, there simply are not enough jobs to go around. Unemployment is going much higher, and will stay that way. TPTB understand this, although they will never admit this to the public. I can only think of a handful of sectors that have kept pace with inflation over the last twenty years, and this is because they either have government contracts, are government themselves, or are in sectors that have government subsidies. 90% can be traced to federal spending in/on those sectors. Those that deal exclusively with the private sector have been seeing margin compression for years now.  There is only one way out of this mess, and that is WW3 {with limited nukes, as much as that is possible}. TPTB refer to all of this surplus labor as: USELESS EATERS.  They want to reduce population world-wide. They get more bang for their buck {no pun intended} by hitting the highest population densities, namely India, China, and other pacific rim nations. But don't think that europe and the USA will be spared, because they won't be. They would like to see a reduction by at LEAST 2/3rds! More would be even better {according to them}. I suspect this wil happen sooner than many think. And no, this isn't from Alex Jones, this is straight from the Club of Rome and other like minded elitist who form much of UN and NATO policy.

Aussiekiwi's picture

Hey Obsoleteman, with you with the American middle class out sourcing jobs, unemployment up permanently etc....but hang on amoment, using Nukes to hit India and China, and that is according to you 'the only way out of this mess' lol, your not playing with a full deck. Are you sure that nuking half the world is really the only way out, you can't possibly think of any other way? 

TheObsoleteMan's picture

Aussiekiwi; the nuke solution is NOT my idea, it is theirs. The USA will not nuke India, Pakistan will {and India will retaliate}. The USA will nuke China though. The best way to screw over your creditor after they have stopped loaning you money is to shoot them. I can thank of other ways to solve this crisis, even if it is to do nothing. But World War serves their purposes, and that is what we will get.

Doubleguns's picture

For the neocon republicrats or communist democins there is always chemical or biological. 2 other options for reducing 2/3rds of the population. I personally think starvation will win out in the end.

overmedicatedundersexed's picture

seems the brain washing of : Look America those jobs are never coming back, eat your peas. is every effective. Never question the mind set you have been fed by the propaganda of NWO.

TheObsoleteMan's picture

Overmeds: Those jobs ARE NOT COMING BACK IN OUR LIFETIME. Even on the slim to none possibility that they would, they would return as minimum wage pay with no benefits. So why bother?

Tommy Gunner's picture

The biggest population of useless eaters are the big fat lazy slobs that inhabit America.  Yes - the ones who sit on their sofas and guzzle gallons of cola, 241 pizzas while watching Fox TV, Dancing with the Stars and American Idol re-runs (yes that is how stupid they are). 

By wiping these losers out you could cull about 250 million people - not a bad start.

shuckster's picture

That's a myth. No one in America does any of that

ebworthen's picture

You mean two part time jobs at $8.75 an hour with no benefits won't let me buy my dream home and a new GM?

Whiskey Tango Foxtrot?

They promised...

Jack Sheet's picture

Of course. You are eligible for any number of government loans.

Aussiekiwi's picture

Come to Aussie mate, $20 an hour for virtually any basic job, Perth is the place at the moment, great climate, great standard of living.

ghenny's picture

Except its in Australia, thousands of miles from where most of our life together on this planet is happening.  Australia, while a very good country is like living on the moon for most of us who like to be in the thick of the cultural, economic and political action that drives our world.  

bigwavedave's picture

Way too much focus on "JOBS" - Employ a third worlder like Mitt does and charge it back to your employer after you move 'On Contract' 

Westcoastliberal's picture

I really don't think Obama has any compassion or even understanding of just how fucked Americans really are.  In his book "Confidence Men" Ron Susskind told the tale of how shocked Obama's advisors were when he announced, paraphrasing here, that "Unemployment is a result of increased productivity, and there's not much to be done about it."  He also had the 5 TBTF CEO's by the short hairs and let them off the hook on the Foreclosure problem.  That's why we're not just stuck in neutral, we're going backwards:

TahoeBilly2012's picture

This is all fantasy best case stuff. Worst case is way out of these ranges.

Nage42's picture

Not to worry, there is a much simpler "fix" for the unemployment _rate_.

You don't need to have more jobs, you just simply have less people... duh.

I think TPTB are prolly waiting to see if the serfs will up and kill themselves a bit before they have to go and waste expensive bullets, or engineer a decent bird-flu, or the like.


Project "HIV" in the 3rd world has been a great success for them, a bit more tinkering and the HIV payload can be delivered by a more robust deployment vector like bird-flu and you've got "Yahtzee!"

Go ahead, tell me that you think there _isn't_ some small group think-tank that is working this "solution."  With a "defence" spend that high, you can afford to work out every possible scenario, even the OMFG! ones.  If you've ever fished through the de-classified docs (60-70 years back) you'll see that every "solution" is researched, and the bang-for-buck ratio filters out the winners... and spending a few million on some gene-eng beats the pants off of any other contender on the table, I guarentee it!



r00t61's picture

I have a better fix, and it doesn't involve killing anyone.

Just make unemployment illegal.

And watch that BLS stat drop like a stone.

steelrules's picture

Peer reviewed estimates show that 7million Americans may have died during the great depression, what will the total be this time with this engineered collapse?

JohnKozac's picture

The Misery Index (inflation plus underemployment) is ~20%.

(~6% + 15%  = 20%)

LawsofPhysics's picture

Doing government math are we?  Last time I checked 6+15=21, but maybe the approximation is indicative of your error.  + 1 is 5% error.  Wish I could be off be 5% and still stay in business.

world_debt_slave's picture

Amerika gives black holes a bad name, as black holes do serve and important role unlike the US guv.

LarryDavis's picture

This piece was written terribly.

El Oregonian's picture

But.. but... but, it ain't going to effect my welfare check, right?

Bicycle Repairman's picture

LOL. I'm loving the graph showing the future of job creation.  Let me "throw a dart at the board."  The line will turn back down violently in 2013.  Why?  Obamacare, Taxageddon, etc.

New American Revolution's picture

I love that Hamilton Project chart... lol... sweet, with luck like this I'm betting my life on winning the Mega-Millions jackpot.