The latest report from the U.S. Department of Labor shows that unemployment shot up to 6.4 percent in June, the highest rate in nine years. But an even more chilling statistic is that for 24 months (and counting), employment is lower than it was one year before. The result has been the longest private-sector employment slump since the Great Depression. Beginning in February 2001, the month after George W. Bush took over the White House, the economy has shed 2.6 million jobs -- equivalent to 93,000 workers joining the unemployment rolls each month.
What is especially surprising is that these job losses keeps occurring even as the economy is growing. We aren't experiencing a "jobless recovery" -- more accurately, this is a "jobloss recovery."
Virtually all economists who have studied the
changing income distribution have confirmed what nearly everyone else knows. For
most Americans, living standards are stagnating and becoming more unstable. For
the bottom half, income is falling. And the prime culprit is not shifts in
family values or the work ethic, or even changes in taxes and social benefits.
Most of the problem is the erosion of wage and salary income.
From the early-nineteenth-century introduction
of steam power through the dawning of the age of the microchip
in the post-World War II era, real economic growth in America
averaged 3.8 percent per year. That meant economic output doubled
roughly every 19 years. Then after the 1970s, growth collapsed.
During the 1980s, growth averaged just 2.7 percent per year and
since 1989 only about 2 percent. At that rate, it will take nearly
36 years for gross domestic product (GDP) to double again.