Labor Market Contraction Still Has Some Distance to Run

 

The civilian unemployment rate has moved up from 6.2% to 9.4% during this period. The government?EUR??,,????'???s broadest measure of labor underutilization (U-6), including discouraged workers and those working only part time for economic reasons, climbed to a lofty 16.4% by May. ?EUR??,,????'??? Courtesy of Los Angeles Independent Media Center

In a recessionary economy typically employment is the last sector to recover and this includes the landscape industry. The labor market typically continues to contract while the early stages of recovery in economic output are underway as labor productivity (output per hour) rises. This pattern could materialize in the second half of this year and perhaps in the early part of 2010 as well.

National Association of Home Builders expects payroll employment to stabilize by year-end at a level that?EUR??,,????'???s about 7 million below the cyclical peak. The unemployment rate could top out close to 10% during the first quarter of 2010 ?EUR??,,????'??+ about double the rate associated with a fully employed, low-inflation economy. ?EUR??,,????'??? Courtesy of National Association of Home Builders