I’ve heard it said that a recession is something that happens to other people. If it happens to you, it’s more than some term that defines a segment of the business cycle – it’s personal disaster.
However, information being delivered about the economy is taking on the look and feel of some local news station clawing for ratings – it’s the business equivalent of yelling fire, murder, blizzard, hurricane, and 50-care pile-up on the freeway, all rolled into one glorious this-is-the-end-of-the-world-as-we-know-it (a fine REM song by the way). And it’s coming from everywhere, 24/7 so to speak.
So let’s examine what’s going on. 11.4% unemployment in January. 12.2% when confined to non-agriculture industries. Man, that’s one nasty downturn. Except the year I’m referring to isn’t 2009, it’s 1983.
You mean we’ve been through this before? And more recently then the Great Depression everyone seems to want to dredge up?
Well, yes and no. This is not an equal opportunity recession. Certain industry sectors and geographic regions are getting hit much harder than others. In January of this year, unemployment in the construction sector was a whopping 18.2%, durable goods manufacturing was at 11.2% in that same period, with leisure and hospitality at 11.5%. Michigan is getting beat badly with 10.6% unemployment reported in December of 2008, with Rhode Island not faring much better at 10.0%.
However, Education and health services is at 3.8%, Government at 3.0%, and Financial services surprisingly at 6.0%. In the meantime, Nebraska reported 4.0% in December with Kansas at 5.2% and New Hampshire at 4.6%.
Now I’m certainly not calling for a chorus of “Let the good times roll.” There are many people that are in dire straits and need help. But I am suggesting we look more precisely at what’s going on.