The Bureau of Labor Statistics this morning reported another large rise in unemployment. The official unemployment rate now sits at 8.5%, up from 8.1% last month and higher than at any time since November 1983. Job losses for March totaled 663,000. Since December 2007, when the recession began, 5.1 million jobs have been lost, with 3.3 million of those occurring in the last five months.
"Among the unemployed, the number of job losers and persons who completed temporary jobs increased by 547,000 to 8.2 million in March. This group has nearly doubled in size over the past 12 months," the BLS reported.
Bad as the numbers are, the misery is worse than they show. The official unemployment rate (called U3 by the BLS) doesn’t count people who are so discouraged they have given up looking for work nor those who have taken a part-time job only because they can’t find full-time employment. The figure that includes these Americans (U6) hit 15.6% today, up from 14.8% last month.
In the 1930s, part-time workers – like many of those employed by the New Deal’s Civilian Conservation Corps and Works Progress Administration – were not counted in unemployment statistics. So the figures for unemployment in that era – which hit a peak of nearly 25% but averaged 14.8% from 1930-1939 – are more closely paralleled by U6 than U3.
U3 Unemployment Measure
U6 Unemployment Measure
The Labor Department reported Thursday that continuing jobless claims – that is, unemployment benefits drawn by workers in the week that ended March 21 – rose 161,000 to 5,728,000. That’s the highest since the government started keeping such statistics in 1967. Continuing claims have risen 11 consecutive weeks and are up more than 1 million since January. According to the BLS, however, only 36 percent of unemployed Americans received unemployment benefits in 2008.
State-by-state figures won’t be available until April 17. States in the Midwest and West are again expected to suffer the worst.
For the third time in five months, enrollment in the food stamp program, now called the Supplemental Nutrition Assistance Program, hit a record. The government reported Thursday that 32.2 million people - one in every 10 Americans - received food stamps at the latest count. The average monthly benefit is $112.82 per person.
While the pain of the depressed economy is felt everywhere, some places are worse off than others. In Detroit, for instance, unemployment hit 22.2% in January. In Saginaw, Michigan, there are fewer manufacturing jobs than at any time in the past 89 years. Small businesses are folding at an alarming rate. The photo to the right is one of numerous closed operations in a quarter-mile section of the Santa Fe Trail in Overland Park, Kansas, near Kansas City. But most of us don’t have to drive far to find similar empty buildings. A 1% rise in unemployment translates into a 3.2% rise in office vacancy rates, according to John Lonski, Chief Economist at Moody's Capital Markets. Expectations are that the office vacancy rate nationwide will hit 19% by the end of 2009, the worst rate since 1992.
Across the nation, tent cities that predated the burst real estate bubble and the stock market plunge, are growing in size and numbers, impromptu Bushvilles to house people out of a job and out of a home. As Scott Bransford wrote in "Tarp Nation" for High Country News:
From the well-kept interior of the [Marie and Francisco] Caros's place, one can hardly see the jagged rows of tents and shanties on the vacant land around them. About 200 people have built informal habitats along the railroad tracks, primarily poor whites and migrant workers from Mexico.
There are many names for this fledgling city, where Old Glory flies from improvised flagpoles and trash heaps rise and fall with the wavering population. To some it's Little Tijuana, but most people call it Taco Flat.
Just to the south, under a freeway overpass, there's another camp of roughly equal size called New Jack City where most of the residents are black. Even more dwellings are scattered throughout the neighborhood nearby, appended to the walls of industrial buildings and rising up the flanks of freeway spurs.
Fresno, which the Brookings Institution ranked in 2005 as the American city with the greatest concentration of poverty, is far from the only place where people are resorting to life in makeshift abodes. Similar encampments are proliferating throughout the West, everywhere from the industrial hub of Ontario, Calif., to the struggling casino district of Reno, Nev., and the upscale suburbs of Washington state. ...
People such as the Caros are part of a vanguard that has been in crisis for years, building squatter settlements as a do-or-die alternative to the places that rejected them [not unlike the 1930s "Hooverville" in the photo to the right]. This parallel nation, with a population now numbering in the thousands in Fresno alone, was born during the boom times, and it is bound to flourish as the economy falters.
Numerous economists, as well as Federal Reserve Chairman Ben Bernanke, say the recession could end this year if the government’s stimulus and bank bail-out spending works to restore confidence. Some also say that while lay-offs will continue, they may drop in the second quarter to half the level they have been for January-March. If so, that would still mean nearly an additional 1 million Americans unemployed by the end of June. Not the best year to be getting a college diploma. Labor experts predict the unemployment rate for college graduates will reach a record 4 percent or 5 percent this year.