Typically after a recession, especially a steep one, the job market booms. Having shed so many workers during hard times, companies are eager to rebuild their workforce and take advantage of expanding business. Not this time. Job growth has been weak in this recovery, and in May it got even weaker.
The employment report was a huge disappointment with only 54,000 net new jobs created in the United States. This was the worst result since September 2010 and well below Wall Street’s prediction of 161,000 new jobs. The official unemployment rate ticked up from 9.0 to 9.1 percent, double the rate that prevailed just prior to the recession. Of course, the true level of unemployment is actually much higher than the official unemployment rate. Counting part-time workers who are looking for full-time work, as well as those so disheartened they no longer search for work, the real unemployment/underemployment figure is 18.9 percent of the working population, according to Gallup, the polling firm.
To put all this in perspective: The last time the US had a steep recession – in 1981/82 – the economy lost 2.8 million jobs but then boomed, creating 7.3 million jobs over the next two years. This time, the economy lost nearly 8.8 million jobs. Two years later, it had regained only 1.8 million of them.