Long Slow Recovery vs. Double Dip Recession

Interesting NYT Economix piece from Casey Mulligan on if we’re seeing long slow recovery out of the 08-09 recession or the beginning of a double dip recession. One thing he does is predict that national employment and work hours will be “a couple of percentage points higher at the end of 2010 than they are now.”

I think he’s kind of crazy, but I wanted to put it on the record so that we can look back at it at the end of the year.

First of all, the guidelines: Mulligan says that national employment will be “a couple of percentage points” higher. I’m going to assume that this means employment-population ratio as defined by the BLS which, as of this writing, is 58.7%. It is up .5% from its nadir at 58.2% last December. Let’s say that “a couple percentage points” means an increase of 1.0% in the employment-population ratio. This gives him quite the benefit of the doubt, I think.

Based on my very rough calculations, that would mean we’re looking at an increase of about 3.06 million jobs in the next couple of months, averaging 437,000 job increase per month. Keep in mind, this still puts us way below the height of the employment-population ratio of 64.7% in 2000 and nearly a full percentage below the employment ratio in place a year and a half ago.

No. Freaking. Way. Not happening. Honestly, I would be surprised if we saw another .5% increase (which is what we’ve seen in the last 6 months). I’ll stake my claim there, even though I have a feeling that we might not even make that number… I see this recovery being even flatter than that.

In any case, here’s a view of the predictions. We’ll revisit in a half a year. Or possibly in October or November when if it looks like one of us is on track.

Employment-Population Ratio 2006 – Present

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3 comments

  1. Mark says:

    You are very generous. “A couple” is two. “Points” is plural. Just for kicks, I’d like to see a “Casey Mulligan (literal)” entry with an increase of 2.0, if for no other reason than to show how ludicr– er… optimistic his estimate is.

    The y-axis having .5 at the end of each number looks very strange. I like my numbers like I like my women: whole.

  2. Thanks for sharing great article.

  3. nt12mny says:

    I’m just curious as to the real numbers of unemployed and employed males to females in these numbers. iow if you take out the number of females that have jobs vs the number of males that are out of work. my assumption is that the number of men out of work is much greater than the number of women. when women leave the workplace say to get married or have children they usually don’t report to the system that keeps track of the unemployment rate. they just drop off the map. i believe this is the same when they loose their job they typically don’t file for unemployment benifits. i could be wrong.