This morning the Bureau of Labor Statistics released the latest jobs numbers. The report contained some encouraging news: the unemployment rate dipped below 9 percent for the first time in nearly two years, to 8.9 percent as private-sector employers added 222,000 jobs. In short, the employment situation may finally be improving.
However, it’s worth looking back to the beginning of the recession to understand how much more improvement in labor markets is still needed. There are still roughly 6.7 million fewer jobs today than there were in the first official month of the recession, December 2007 (remember that the recession officially ended in June 2009). Also, there were about 2.1 million more jobs prior to the passage of the stimulus bill in February 2009 than there are today. Furthermore, there are still 13.6 million technically unemployed people, and another roughly 6.4 million Americans who are not counted in the labor force but who would like a job. Once the employment outlook starts to improve, people in that latter group will start looking for jobs again, pushing the unemployment rate back up or slowing its decline.
This graphic, from Calculated Risk, shows the path of employment in this recession relative to recent recessions: