March 5, 2010

Carrick: Two sectors account for more than half of U.S. job losses since 2007

The following are some highlights from today’s U.S. labor market report from the Bureau of Labor Statistics.

U.S. employment declined again in February 2010, but by only 36,000 jobs. In the worst month for employment in the recession, January of last year, the jobs decline was 780,000.

It is clear that the employment situation has improved and stabilized considerably since a year ago.

Over the past four months, the U.S. jobs picture has been essentially flat. Having said this, the U.S. recovery is proceeding without an improvement in employment so far. It is being referred to as a “jobless recovery.”

Looking back a little further, U.S. overall employment started to decline towards the end of 2007. The total drop in the number of jobs is now 8.4 million. This continues to act as a drag on consumer confidence, spending and home-buying activity.

Two sectors account for more than 50% of the total employment decline – manufacturing at -2.3 million jobs and construction at -2.2 million.

Since manufacturing still accounts for more than double the number of jobs as construction, it is clear that the latter category of work has borne the brunt of the pain.

Furthermore, the manufacturing employment decline has leveled off over the past six months, whereas construction employment is still headed down.

The U.S. unemployment rate stayed steady in the latest month, just under 10.0% at 9.7%.

-Alex Carrick, CanaData chief economist

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