Unemployment by Sector
Ryan Avent gives us two charts that make the point that despite the recession’s origins in the high-priced world of finance, the resulting unemployment has a distinctly blue collar look to it:
And:
I imagine that, AIG bonuses aside, there’s been a very large amount of lost wealth and income on Wall Street that, in turn, trickles down to job losses in the retail and expensive restaurant sectors. But not only is the total unemployment rate in finance low, but the increase in unemployment there has been distinctly modest compared to construction, mining, agriculture, manufacturing, retail & wholesale, and even transportation. It’s a reminder that endlessly fascinating as the financial snarl may be, you’re mostly look at a collapse in demand. People in general are buying less stuff, leading to fewer jobs in the fields of making stuff, moving it around, and selling it.
25 Responses to “Unemployment by Sector”
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March 18th, 2009 at 11:51 am
Or it simply means that stock brokers are less likely to claim unemployment.
March 18th, 2009 at 12:14 pm
the increase in unemployment there has been distinctly modest compared to construction, mining, agriculture, manufacturing, retail & wholesale, and even transportation.
I don’t know about that. Comparing one industry to another, sure, but comparing 2008 to 2009, it looks like unemployment doubled in both blue-collar and white-collar jobs pretty evenly.
Just based on eyeballing the charts it looks like the management sector went from 2 percent unemployment to 4 percent or a little less, while the farming/fishing and construction sectors both went from 12 percent to 23 percent or so, and the production occupations sector from 6-ish percent to 14-ish percent. The difference seems more pronounced by industry, but even there it looks like the financial activities and professional and business services saw at least a 60 percent or so increase.
The least affected: the service occupations sector, and the information, education and health services, leisure and hospitality, and government industries. Interesting. It’s no real surprise about government, with which education and health services work hand in glove, but service and leisure and hospitality? Apparently people still have SOME discretionary money. And I don’t have any glib comments at all on IT; that seems out of the blue there.
March 18th, 2009 at 12:17 pm
The recession didn’t start in finance, it started in construction and industries tied to home sales (lumber, furniture, etc.). That was before the financial crisis intensified. And the downturn in consumer spending has been enormous, hitting auto manufacturing in particular.
Also, a lot of these laid-off finance folks probably aren’t looking for work, which is required to be counted as unemployed. (It doesn’t have anything to do with claiming unemployment, despite what David says above.) They’re either getting severance payments, so they’re not looking, or think there’s no hope, so they’re not looking.
March 18th, 2009 at 12:17 pm
So, if this is really a demand side driven recession, why are Republicans still advocating supply side solutions?
March 18th, 2009 at 12:24 pm
An unemployed person isn’t working so how can they have a specific industry. Many unemployed people will end up working in different industries than before. If this is showing job loss by industry that makes sense, but there is no sense in locking unemployed people into specific industries.
March 18th, 2009 at 12:25 pm
“Or it simply means that stock brokers are less likely to claim unemployment.”
This. Loads of my sacked contacts are “taking time out”, although it’s true that many have switched from the sell-side to the buy side.
What would be informative would be an “employment numbers by industry chart”, but the BLS doesn’t seem to provide one, only unemployment. Very odd.
March 18th, 2009 at 12:27 pm
интересный блог…
Ryan Avent gives us two charts that make the point that despite the recession’s origins in the[...]…
March 18th, 2009 at 12:29 pm
So, if this is really a demand side driven recession, why are Republicans still advocating supply side solutions?
To the extent this question means anything at all, I think it would be that the previous levels of demand were not sustainable. But many people would dispute the premise.
March 18th, 2009 at 12:30 pm
despite the recession’s origins in the high-priced world of finance
This recession didn’t start in finance! It started in housing. The banks got caught because they made highly leveraged bets on housing but that has had very little impact on the depth of the recession. We need functioning banks and fortunately we have lots of functioning banks. We just need the zombie banks to not linger on, threatening to use their subsidized funds to drive good banks out of business.
March 18th, 2009 at 12:33 pm
Companies are forced to accept work for break even or less. Many do this because they don’t want to lay off skilled workers only to have to find new ones and train them when the economy recovers. Additionally they don’t want to concede market share or prized accounts to competitors, neither of which they might get back later. So, everyone does their work for no gain, draining reserves, asking employees to take pay and benefit cuts and generally weakening the entire enterprise while hoping to come through on the other side somehow able to survive. Meanwhile those they serve get used to the goods and services at reduced pricing and come to expect it permanently. After all, if you can get what you want at these numbers today it probably means you’ve been getting gigged all along and only now are paying a fair price, right? It’s a shitty business environment and there will be toxic fallout for years. You get in a permanent mode of panic and begging but so is everybody else, you just do it. It’s akin to a bunch of POWs fighting over food scraps. To hell with dignity, camaraderie or respect for your peers, it’s every man for himself in a death struggle. 300 million people with PTSD is what we’ll have on our hands.
March 18th, 2009 at 12:36 pm
What’s going on in agriculture and fishing? Or, I guess, primarily agriculture. Why was unemployment there so high in Feb 08, and getting higher still since then, at about the same rate as in construction? That seems surprising to me, and not to have attracted much notice (of course, its a small part of total employment, but still).
March 18th, 2009 at 12:37 pm
I imagine that, AIG bonuses aside, there’s been a very large amount of lost wealth and income on Wall Street that, in turn, trickles down to job losses in the retail and expensive restaurant sectors.
========================================================
Haven’t you guys been saying for years that “trickle down” economics doesn’t work?
March 18th, 2009 at 12:38 pm
Does this mean you believe in trickle down economics? If the claim is: rich people lost wealth – therefor blue collar workers will lose wealth – then the opposite must also be true: as rich people get richer, blue collar workers will as well.
Sounds like trickle down economics, no?
March 18th, 2009 at 12:52 pm
If the claim is: rich people lost wealth – therefor blue collar workers will lose wealth – then the opposite must also be true: as rich people get richer, blue collar workers will as well.
Why must be the opposite be true? You give no reasons, and rising income inequality in recent decades seems like pretty obvious counter-evidence.
March 18th, 2009 at 1:01 pm
This post and the next one are hilarious. So we’ve finally accepted the reality that what happens to Wall Street effects main street?
On your “trickle down” theory, you’ve got it all wrong. It’s far more complicated and goes directly to the variables of uncertainty and the effects of a significant economic downturn (as a result of what’s happening on Wall Street) is killing demand, since folks don’t want to risk spending money they might need. This has nothing to do with less than .1% of the population that lost their jobs on Wall Street. That’s just silly…and that’s not something that any supply-sider would believe.
Also, you might want to take a look at people’s retirement accounts, and how the massive losses in those might be driving some of this as well.
Boy, the real conservatives are coming home to roost.
March 18th, 2009 at 1:04 pm
How can one lose that which did not exist?
March 18th, 2009 at 1:19 pm
Agree with DTM.
March 18th, 2009 at 1:25 pm
So, if this is really a demand side driven recession, why are Republicans still advocating supply side solutions?
I believe the fresh water economists are arguing that all these recently unemployed people have collectively decided to prefer leisure time to work. What caused this massive shift in preference for relaxation over income isn’t exactly clear, but what is clear is that tax cuts will provide the incentives to stop watching Oprah and get back to work!
March 18th, 2009 at 1:28 pm
@steve duncan – Totally agree with your conclusion. And at the same time many small businesses and sole proprietors are having their credit lines limited, so cash flow is crunched. These firms may not make it through the next 6 months.
March 18th, 2009 at 5:35 pm
Matt writes: “despite the recession’s origins in the high-priced world of finance, the resulting unemployment has a distinctly blue collar look to it:”
The recession’s are in the popping of the Housing Bubble, with mortgage defaults and the collapse of home prices and home construction, overwhelmingly in four states a long way from Wall Street: California, Arizona, Nevada, and Florida (where 7/8ths of the price appreciation in America had taken place).
I know it was a long time ago, Matt, but it was in all the papers at the time.
March 18th, 2009 at 5:59 pm
I don’t see hunting/gathering in that list. Why the prejudice?
March 18th, 2009 at 6:16 pm
I wonder if the unemployment in the construction and agricultural sectors isn’t the tip of the iceberg. A fair number of those who became jobless in these sectors have returned, and are returning, to Mexico. Perhaps we have been able to export the problem to some degree.
March 18th, 2009 at 7:53 pm
Re: And I don’t have any glib comments at all on IT; that seems out of the blue there.
IT had its big shake-out at the beginning of the decade. There aren’t as many extraneous jobs to cut in the sector.
Re: Also, a lot of these laid-off finance folks probably aren’t looking for work
I very much doubt that. Maybe ex-CEOs and hedge fund managers are kicking back on their yachts, but the rank and file don’t get squat for severance and they’re out there hustling up jobs like everyone else. I suspect the lower rate here (and in IT to an extent) is due to the fact that these people are more flexible and can fit in a lot more places than a laid off lineworker at GM can.
By the way, why did farming lose so many jobs? Since people still have to eat I would think that would be close to recession proof.
April 9th, 2009 at 6:10 am
The style of writing is quite familiar . Did you write guest posts for other blogs?