The Associated Press
reported last night that many economists expect the country's unemployment rate to remain high for years. This, combined with decreased standards of living, could become the "new normal" for America after the recession.
Why won't economic recovery correspond to more jobs? The AP listed four primary reasons:
- The two industries that pushed America out of past recessions are auto manufacturing and construction. And those industries... aren't doing so hot.
- A rather Keynesian observation: We're stuck in a miserable cycle. Americans can't spend without jobs, but companies can't create jobs unless people spend.
- Small businesses have been having trouble getting bank loans, which restricts their abilities to expand and hire employees.
- The recession is strangling both high- and low-income families; the former are reeling from substantial losses and things like home values and retirement funds, while the latter are unable to borrow money and therefore need to reduce their spending.
According to the AP, economists expect our economy to improve, albeit slightly, over the current quarter. That's the best case scenario; otherwise, the recovery could lose steam, and the US could slip into a double-dip recession.
If we want more jobs for Americans, economists say, they will have to come from private businesses, not the government—government jobs can only help so many people for so long.
Do you think the unemployment rate will remain high for years? What should the government and/or everyday people do to facilitate job creation?
Comments (9)
i was watching the local news a few nights ago about unemployment. it basically said that there are plenty of jobs available for grabs, but these employers that are hiring, are not just hiring anyone, the people who applying for these available jobs aren't qualified for the jobs. that's the problems. most of the people who are unemployed either don't have the qualifications for the job or the employers are selective.
I have already stated my views on this. Things will get slightly better, but unemployment numbers may just continue to get worse and in around 5 years the dollar will collapse. What we have are banks who are scared to take risk and potential business owners unable to take a risk and unable to compete with bigger chain stores.
And it's pretty much as mewithoutu77 stated. Yes, there are jobs, but employers are highly selective. As to the other jobs, they are part-time retail, or bottom dollar retail jobs. If people take these jobs, they have to take 2 or 3 just to keep bills paid or drastically reduce their standard of living.
Because the government intervened so drastically, the dollar and the job outlook won't get much better than it is now.
@xplodinglastbullet@xanga - I don't think it will even take 5 years. I think we'll hit hyperinflation with a year...maybe two
@ShamelesslyRed@xanga - it'll take a bit longer for hyperinflation to take place because of the tax hikes. The higher the debt, the lower the value of the dollar, and sadly enough, the higher the tax rate gets. Thus the Fed is getting more money to put back on the debt. But I am glad you agree that it will collapse :D
That is not pretty... :x
Most of the studying I do with the economy lately has only related to the global economy and the politics of it. But we have had discussions about the domestic effects and one of the larger trends that we have come across is that this recovery is going to be a jobless one. Sadly, as a soon to be graduating college student, I find that I agree with it. I'm no economist, because that's what the trend is proving to be at this point.
Probably gonna stay high unless the economy becomes more people-based, rather than company based. Employing ourselves and eachother is the way the economy originally was for the most part...and this country prospered originally due to hard work and making something with what we have.
The saddest part of it all, though is my generation. Just outta high school and college and no ready-made options. We scrape even harder than the elderly and our parents.
We're not far along yet for me to be able to say whether I feel sorrier for my generation or the one after mine, who probably won't know that the country is worse off than their parents knew it as originally.
If there is anything the government can do, it's to provide bigger and better incentives for private business owners (not major conglomerates, mind you), otherwise they stay out of it. The rest is up to us. We have to be more entrepreneurial minded. Yes, at first it will be hard, but I think that if more people owned their own... we do better.
Oh, yeah, eliminate income tax altogether.
@misuriver@xanga - This country would be screwed over if we eliminated the income tax, or any of the taxes for that matter. While the government does some idiotic spending, they need the revenue. Why do you think a lot of the developing world is struggling, particularly in Africa. Part of the reason is because they have no infrastructure to produce a taxing system. They can't fund their own governments so they go further in to debt. I don't like taxes, but I'll live with them.