Oxford Analytica looks into the possibility of a “jobless recovery” in a new report. “With some — albeit highly disputed — signs of recovery in the global economy, there is growing debate on what form this might take.”
“Both recent experience and economic theory would suggest that a return to growth, at least in the short term, might not be accompanied by an increase in employment.”
In 2001, after the burst of the dot-com bubble, recovery was fairly rapid. However, though mature economies already had seen a return to growth by 2002, employment did not recover in the same way. Rather, it continued to lag behind.
Economic theory offers a possible explanation as to why the effect of downturns on labour demand can be extremely long-lived or, in other words, why recovery, in effect, can be ‘jobless’:
- When there is a downturn in economic activity, employment rates fall (ie jobs are lost) and companies stop investing in new technology.
- However, since the innovation cycle is much longer than most downturns in the business cycle the rate of innovation in the economy is not overly affected, new discoveries continue to be made.
- This means that, when demand starts to recover, surviving companies have the option to buy into the latest technology.
- Those that do so soonest are likely to be the most competitive and hence best able to increase productivity.
- For a time, companies can increase production by investing in new technologies, and thus delay re-hiring people.
The question is whether this pattern is set to recur when the world begins to emerge from the current recession.
#37, Alfred1, oh come on… now your saying that common sense and balance between statist and free market is communism? Hah.
What you are arguing for is anarchy which will miraculously resolve itself into efficiency. I’m not one to depend on miracles.
Alfie,
Did you just discover Ayn Rand or something? You write your comments like they are coming out of an ideological handbook. If you actually want to learn something about economics try here.
#16, Alphie,
Thinking out of the box for real solutions requires we return to earlier mechanisms that worked…free market.
Unfortunately, it was the free market that got us in the situation we are in today.
#23,
Lose the regulation, and small business will explode…after a recovery, then you can clamp down on the abuses.
Your shortsightedness is showing. After the previous abuses, they regulations were clamped down. You want to open up the gates to repeat all the forms of abuse we had before. That was recently tried with the relaxation of regulations (and enforcement of the remaining ones) in the financial sector. I think we can all see what happened there.
#26,
… it does not follow you outlaw the group for the sins of a few.
Taxi drivers are not outlawed. They are regulated to ensure they are qualified to operate. Every municipality I am aware of has a Taxi Board that complaints can be directed to. These boards have no control over gypsy taxis. They do protect consumers.
But at least we have an inkling what you do for a living. Good for you! A gypsy hack, and I bet you have a St. Christopher statue on the dash too. And you pass out Jesus tracts to your
prisonerspassengers too. Now you’re upset because the Taxi Board says you can’t preach.Hmmm. The condition that caused the current mess go back to at least Clinton if not Bush I.
Even if you want to say GWB started it, so what? That doesn’t justify the incredible new damage being caused by BHO.
A minor remodeling project doesn’t start by burning the house down!
#30, Alphie,
I’ve been to the third world where regulation is not allowed to prevent street vendors from existing…as is done in the US.
First, I wouldn’t call East LA a third world country. It might be as big as some, but alas, …
Second, can you tell us of one American city where street venders are banned? I’m not asking too much, just give us one.
Now if you had the choice, which would you prefer; street venders be regulated for cleanliness or a total free market with you losing your kidney function because of e. coli?
# 39 JimR said, “That’s not the reason. Nobel economist Milton Friedman:..”
And, exactly how many economies has Mr. Friedman managed? ZERO… An expert with no demonstrable ability to operate in his field of “expertise”. You should look to more credible sources…
Do you realize that you will probably never work again at a ‘real job’?
When I was still looking for any job at all, I did get two ‘interviews’ but when they saw how old I was. That was that. I should have not wasted my time and money going to see them.
My only advice is, “Don’t get sick.” or, you will be in real trouble!
#46, Cow-Patty,
Jesus H. Christ !!! WTF do you want. Friedman is a god to the extreme right and you dismiss him? So we all need to operate a popcycle stand before we can be taken seriously?
Geeze you are a moran.
# 48 Mr. Fusion said, “WTF do you want. Friedman is a god to the extreme right and you dismiss him?”
What do I want? The same thing any sane person would want from an “expert”. A demonstrated ability in the area of claimed expertise. Again, I ask, what econmy has he successful lead?
Would you listen to a civil engineering “expert” who had NEVER designed anything that had actually been built? I hope not but, I don’t think you have that much common sense…
Sounds like more money for the wealthy by taking advantage of cheap labor.
While arguing for a free market against statists is like a day with sunshine, I’ve missed my daily Limbaugh and Palin Twitter…chow
#42 I will read that if it explains how borrowing money from everyone you know, including any loan sharks in the area, and spending it on renovating one’s house and property, will stimulate someone into hiring me, works.
Explain how Stimulus works, how putting Government in charge of health care, taxing energy so that it rises exponentially…will get me my neighbors jobs…I’ll check out that site.
OK,OK..
so everyone can point fingers, and toes..
THIs is wrong, thats wrong, EVERYTHING is wrong.
HOW about solutions.
I can give you a few major ones.
FOR SOME REASON
Capitalism is messed up, and its not the TOP and its not the bottom.
Look at imports, sent to this country DIRT CHEAP and we pay as IF’ they were made in the USA, OUT OF GOLD. Wonder whose responsible for the price increase?
The other point looks like this. THE STORE isnt making most of the profit, the MAKERS in the USA arent making the MOST PROFIT.. find the persons in the middle. FIND out whats making the costs of GOODS/SERVICE/FOOD go up and kill it.
Capitalism works when there is competition. NOT when 2 or more business work TOGETHER.
Who understands WHAT Walmart has done?
They are going STRAIGHT to the makers and manufacturers of the world and FORCING them to compete with each other to be SOLD in the USA.
THEN they market them at a slightly lower price then other stores.
The other companies WAIT for someone to bring products TO THEM to SELL. AFTER it has come to the USA, and a distributor has control over the shipments.
Walmarts Plan is based on another corps plan. The OIL CORPS.. Oil corps control ALL the shipping, handling, distribution, and MOST of the sales of their product.
Import tax is based on 1 thing. IF we make the SAME in this country WE CAN TAX IT, as a competitive product. OTHER WISE its not taxed.
The WHOLE design and BUSINESS MODEL has to be changed. THAT alone will make this country better. We need to go back to the 1970′s model.
IF CORPS WISH to run this country.
The more a corp makes profit, the HIGHER the tax. (they have to pay for the ROADS that trucks damage, the properties they are using)
The MORE unemployed, the MORE the tax.(as with this country, you have to PAY for the poor and unemployed)
Tax them to pay for the improvements that are needed for this country, FORCE advancement. NOT this 1 step at a time, BULL. This country is about 20 steps behind in tech.
Run the Gov as a tech industry. the MAIN CORP over all the others.
# 53 ECA said, “We need to go back to the 1970’s model.”
No, go back to the 1900 model. Much better.
#46, Patrick… so you think you know more about the 1929 crash than a Nobel Prize winning economist eh? Why am I not surprised.
First, #7 for the win
@Fusion
You say some very highly intelligent things and then ruin it for me with posts like #11
NAFTA — signed by Clinton and promoted by Gore and the Republicans — is a huge source of damage to this country.
Relocate any job to Mexico with no tariffs and avoid half of our over-regulated laws plus cheaper labor = destroy our manufacturing sector
The current economy is not Obama’s to blame, not Bush’s to blame — but the whole political system including both parties.
It is like there is a giant disconnect between laws, politics, thinking and reality.
And then the politicians go try to “fix” things that have nothing whatsoever to do with the problem or pass dreamboat legislation that makes a problem worse.
I truly believe even with Mexico’s lower cost of labor that the USA could be competitive in manufacturing (maybe).
And I am sometimes in total disbelief at watching the way both parties do business in every state and nationally — it’s like there is no way for the “people” to win with anything resembling good government.
“It is like there is a giant disconnect between laws, politics, thinking and reality.”
an economist is a person that uses numbers to TRY to prove what HAS happened/WILL happen. Insted of looking out a window and gauging WHAT IS HAPPENING.
MORe of them SUCK at the job, then can figure out WHATS wrong.
“I truly believe even with Mexico’s lower cost of labor that the USA could be competitive in manufacturing (maybe).”
And there is a reason, as the USA has the TECH(mostly) in mexico its all done by hand(mostly). And the USA standard of employment is–HIRE 1 that knows the JOB, and 10 idiots to listen to him(run the machines). You pay good wages to the 1 person and CRAP on the other 10.
And why is this?? EDUCATION. How much did you PAY to get that college degree. which makes you LOOK as if you should know something OVEr the person thats already spent 10 years DOING the job and has no education.
#56, Meyer,
Relocate any job to Mexico with no tariffs and avoid half of our over-regulated laws plus cheaper labor = destroy our manufacturing sector
Then you don’t know NAFTA. It wasn’t NAFTA that hurt the American economy. It was the flight of jobs to China and to a much smaller extent Korea, Singapore, the Philippines, and Central America. NAFTA guaranteed working conditions, the slave shop nations don’t.
Cow-Patty,
What do I want? The same thing any sane person would want from an “expert”. A demonstrated ability in the area of claimed expertise. Again, I ask, what econmy has he successful lead?
It appears that the only person you would accept then would be Bill Clinton. He was the last person to lead a healthy economy in the US.
I really do hope you can see just how ridiculous you sound.
# 59 Mr. Fusion said, “It appears that the only person you would accept then would be Bill Clinton. He was the last person to lead a healthy economy in the US.”
Umm, no. He didn’t do it. He was forced into it by the Congress, who actually holds the power of the purse in the U.S. Remember read the Constitution before you post on these matters.
So, whoever was leading congress at the time is who I’d rather listen to.