'Jobless recovery' means another year of bad unemployment news

If past is prologue – as it surely is – then we can expect discouraging unemployment numbers for at least another year and no official announcement from the National Bureau of Economic Research (NBER) that the recession ended this summer until 2011. That's according to Mark J. Perry, writing on Enterprise, the AEI blog.

Perry reached his conclusions by looking at the Bureau of Labor Statistics (BLS) data for the two previous 'jobless recoveries' in 1990-91 and 2001. There he found that unemployment in the first of those recessions continued to go up for 15 months to a peak of 7.8 percent in June 1992. The unemployment numbers remained pointed north for 19 months in the 2001 slowdown, peaking at 6.3 percent in June 2003.

As for the official declaration from NBER of the recessions' ends, Perry noted that the declaration of a March 1991 end was not made for 21 months thereafter, while the declaration of the November 2001 conclusion wasn't made until 20 months later.

This means that, if we assume the current recession ended in June, we will see unemployment to continue increasing throughout 2010, while the long-awaited NBER declaration that the economy resumed growth in June won't come until early 2011. Campaign strategists in the White House and at the Democratic National Committee are no doubt praying that Perry is wrong.

HT: Joy Pavelski for pointing Perry's post out to me following the Examiner editorial, “Welcome to Joe Biden's wildest dreams.
    

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