The unemployment rate of the U.S. economy in August 2011 stood at 9.1%, a far cry from the 4.4% jobless rate seen in the last business expansion which ended in December 2007. The current elevated level of unemployment after two years of economic growth is unprecedented in the post-war period (see Chart 1). The high for the unemployment rate in the post-war period was recorded during the 1981-1982 recession when it touched 10.8% in December 1982.

In this business cycle, the recovery commenced in November 1982 and by January 1985 (26 months of economic recovery/expansion) the unemployment rate had dropped to 7.3%. This time around, the high for the unemployment rate is 10.1% (October 2009) and the recovery is 26 months old with a jobless rate, as noted earlier, of 9.1%. Consequently, the level of concern about a persistently high unemployment rate has risen significantly.

Against this backdrop, President Obama is scheduled to deliver a speech about new proposals to create jobs in the economy on Thursday, September 8. Presidential candidates Mitt Romney and John Hunstman have their respective plans for increasing employment on the table. The principal consideration of these plans is how to increase the number of jobs in the economy. There are different explanations for the stubbornly high jobless rate across different segments of the population, implying that these plans have to include a range of options. Here is a summary table of selected unemployment rates to evaluate these job creation plans which will be part of policy and dinner table discussions in the near term.

Asha Bangalore — Senior Vice President and Economist

http://www.northerntrust.com

Asha Bangalore is Vice President and Economist at The Northern Trust Company, Chicago. Prior to joining the bank in 1994, she was Consultant to savings and loan institutions and commercial banks at Financial & Economic Strategies Corporation, Chicago.

The opinions expressed herein are those of the author and do not necessarily represent the views of The Northern Trust Company. The Northern Trust Company does not warrant the accuracy or completeness of information contained herein, such information is subject to change and is not intended to influence your investment decisions.

Comments

Rick
08 Sep 11, 12:09

Jobs, Jobs, Jobs

In lieu of the Trans-Pacific Partnership that the Obama administration is about to negotiate with Panama, Colombia and South Korea next Tuesday, don't you think it's a little ironic that President Obama would be discussing job creation this Thursday?

Only logged in users are allowed to post comments. Register/ Log in

The Market Oracle is a FREE Financial Markets Forecasting & Analysis web-site.
(c) 2005-2024 MarketOracle.co.uk (Market Oracle Ltd) - Market Oracle Ltd asserts copyright on all articles authored by our editorial team and all comments posted. Any and all information provided within the web-site, is for general information purposes only and Market Oracle Ltd do not warrant the accuracy, timeliness or suitability of any information provided on this site. nor is or shall be deemed to constitute, financial or any other advice or recommendation by us. and are also not meant to be investment advice or solicitation or recommendation to establish market positions. We do not give investment advice and our comments are an expression of opinion only and should not be construed in any manner whatsoever as recommendations to enter into a market position either stock, option, futures contract, bonds, commodity or any other financial instrument at any time. We recommend that independent professional advice is obtained before you make any investment or trading decisions. By using this site you agree to this sites Terms of Use. From time to time we promote or endorse certain products / services that we believe are worthy of your time and attention. In return for that endorsement and only in the cases where you purchase directly though us may we be compensated by the producers of those products.