Higher jobless rates could be the new norm!
WASHINGTON - October 20, 2009 - Even with propagandists’ hopes for an economic revival, many U.S. jobs lost during the current Depression may be gone forever and a weak employment market could linger for years.
That could add up to a new norm of higher joblessness and lower standards of living for many Amerikans, some economists are suggesting.
The words "it's different this time" are always suspect. But economists and policy makers say the job-creating dynamics of previous recoveries can't be counted on now.
Here's why:
That could add up to a new norm of higher joblessness and lower standards of living for many Amerikans, some economists are suggesting.
The words "it's different this time" are always suspect. But economists and policy makers say the job-creating dynamics of previous recoveries can't be counted on now.
Here's why:
- The auto and construction industries helped lead the nation out of past recessions. But the carnage among Detroit's automakers and the surplus of new and foreclosed homes and empty commercial properties make it unlikely these two industries will be engines of growth anytime soon.
- The job market is caught in a vicious circle: Without more jobs, U.S. consumers will have a hard time increasing their spending, but without that spending, businesses might see little reason to start hiring.
- Many small and midsize businesses are still struggling to obtain bank loans, impeding their expansion plans and constraining overall economic growth.
- Higher-income households are spending less because of big losses on their homes, retirement plans and other investments. Lower-income households are cutting back because they can't borrow like they once did.
That the recovery in jobs will be long and drawn out is something on which economists and policy makers can basically agree, even though their proposals for remedies vary widely.
