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Kimberly Amadeo

Healthcare Only Recession-proof Sector in Jobs Report

By October 3, 2008

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In September, the economy lost 159,000 jobs, according to the Employment Report released by the Bureau of Labor Statistics (BLS). Generally, about 150,000 new jobs are needed each month to keep the economy stable.

Year-over-year, employment declined .64%, slightly worse than August's decline of .5%, and continuing the downward trend begun in January 2006. The last time year-over-year job growth trended down this severely was in 2001, which led to 29 months of job losses. However, the current trend is not quite as severe, which may mean it won't last as long. (See Google Spreadsheet Employment)

The unemployment rate stayed at 6.1%. This also continues a worsening trend begun in October 2006, when unemployment was at a low of 4.4%. The total number of unemployed is 9.5 million, about the same as last month, and 2.2 million more than last year in August. (Source: BLS, Employment Situation Summary)

The economy now has 4.32% fewer manufacturing jobs than the year before, continuing the decline begun October 2006. Manufacturing jobs are a good leading indicator of overall economic performance, since they produce big-ticket items that consumers will put off buying when the economy starts to weaken. As the orders decline, manufacturers will hire less workers, and even lay off existing workers to keep costs low. (See Google Spreadsheet Manufacturing Jobs)

For a history of employment reports since March 2007, read Employment Statistics History.

What This Means for You

Health care is really the only area that is growing, so if you are considering a change, now would be a good time to get some training for that field. If you have been laid off, then these articles will help you get a new job, so that you won't be a statistic in next month's unemployment report.

Articles from Alison Doyle, About.com Guide to Job Searching

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October 5, 2008 at 7:24 pm
(1) Ajay Madwesh says:

My view is that keeping the Fed Funds low in 1995-1997 well beyond the point where economy had stabilized – Fed kept watching inflation but did not see the glut of international money flow into the US. Fed held the interest rates at negative rates. The bubble formed with irrational investing in dot-com and the burst should have caused an outflow in 1999-2000 back out of the US. That would have dissipated the bubble.

However, with congressional supervision of Fannie Mae and Freddie Mac, and the forcing by the congress on relaxed lending standards to people who could not afford what they really bought led to money flowing into real estate sector among others.

The only catharysis to this situation is money moving out of the US market – but where will it go?. There is no place for it to go as all currencies are worth less and trending down with the economies slowing.

While a lot of the excess gains due to the money flow is in the process of getting written down, it is miniscule as the estimated collateral is in the $6 trillion range supporting $62 trillion. There is still large excesses – Will it flow into Healthcare? Someone can definitely make a case for it.

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