October 2nd, 2009
Chart of the day, hours-worked edition
Jake is on fire with employment charts this morning in the wake of the atrocious payrolls report. This one in particular is new to me, and extremely sobering:
Even at the worst points of the worst recessions of the 1970s and 1980s, never has the number of hours worked per US person been lower than it is now. And this isn’t happy productive people taking time off because they don’t need to work as hard any more: this is unhappy unemployed people who desperately want and need to earn money but can’t.
What we’re seeing in this graph is, I think, the violent implosion of a large swathe of the working classes. Many of those jobs — the ones which, in the boom, were in or connected to the housing or auto industries in particular — will never come back; if they’re replaced at all it will be with lower-wage, lower-skill service-industry jobs. That bodes very ill for the US economy as a whole, and reinforces my notion that the best-case scenario right now, economically speaking, is essentially a square-root-shaped recession where we rebound from the lows but then fail to grow over the medium or long term.
That said, previous plunges in this graph have been followed by relatively sharp rebounds, so maybe we’ll see the same thing happen again. I just can’t work out what the driver of all that new employment will be.