South Carolina August 2010 Unemployment
The Recession is Over?
The Post and Courier decided to laugh-off the August monthly unemployment rate a missed opportunity to provide readers with information they could use to understand the unique employment issues in South Carolina. Recently the National Bureau of Economic Research (NBER) Business Cycle Dating Committee announced the recession was over in June 2009.
The key question is: How can that be so, when unemployment numbers continue to climb? The answer is that recession dating involves looking for a low point in time – not whether the presumed recovery is significant or even sustainable. It is therefore important not to confuse dating the end of a recession with the hope for a job tomorrow, especially with the employment hole we are in here in South Carolina.
This statement from the committee provides insight into how NBER analyzes business expansions or contractions:
“It places particular emphasis on measures that refer to the total economy rather than to particular sectors. These include a measure of monthly GDP that has been developed by the private forecasting firm Macroeconomic Advisers, measures of monthly GDP and GDI that have been developed by two members of the committee in independent research (James Stock and Mark Watson), real personal income excluding transfers, the payroll and household measures of total employment, and aggregate hours of work in the total economy.”
The Busted Recovery in South Carolina: By the Numbers
The Minneapolis Federal Reserve provides state level analysis of how the last recession compared to others (PDF - Table 1). South Carolina is not faring well and is lagging considerably in employment compared with historical patterns. That’s not good news for the job seeker.
In fact, if we look at unemployment rates for South Carolina compared with other recessions (PDF – Table 2), in June 2009 state unemployment was almost twice as high as in the past two recessions. The good news is the unemployment number could be significantly higher if it were not for a labor force that has declined by 36,000 people since June 2009. If the labor force had maintained its level from the date of the “end of the recession,” unemployment would now be more than 12.5 percent. Unfortunately, this does not bode well for unemployment as we move into the fall and winter months, since people are likely to drift back into the workforce searching for seasonal jobs.
