More than GDP, or CPI, Dow, or other useless acronyms, unemployment rates can really tell us how the 99%'ers are felling and doing. Analyzing unemployment trends from month to month can explain why the country feels like we are going nowhere, while those other acronyms look good. For most of us, being unemployed is our recession, and sometimes depression. This is a story about how some men, and a few women, created a recession in one state.
It is important to understand the historical spectrum of unemployment numbers. Different states have different levels, so it is often more useful to track month to month changes. 1976 is the furthest back my access to Bureau of Labor Statistics goes. So the following analysis only goes back that far.
From 1976 until November, 2008, Minnesota never saw an unemployment increase bigger than three tenths of a percent. That's 384 months. That's two generations. There was never, ever a people's recession bigger than that three tenths metric.
Then the great recession hit. We saw increases in deployment greater than our metric for four months in a row. 384 months without a glitch. I use this to exemplify just how huge losing four tenths of a percent is. It is a once in a lifetime experience, if that. It is generation-ally bad.
Now, Minnesota had recovered from the great recession of 2008. In just a few short years, we went from 8.5% unemployment to 6.8%. Then 2010 happened, and the 2011 Minnesota legislature took power. Employment is going up, but we are told that certain employees don't matter. Public employees. Senators like Mike Parry authored bills to cut our state workforce by 15%. He said we wouldn't even notice.
Then Mr. Parry and his friends brought on what can only be called a second state recession. When our leaders forced us into a state shutdown, they made a conscious choice. In July of 2011 Minnesota's unemployment rose four tenths of a percent. The recession of 2008 was literally once in a lifetime, and these guys made it happen again. On purpose. The human toll had never been worse, and we can now say that once in a lifetime unemployment happened twice in just a few short years.
Now, we know that public workers have become the new scapegoats. They supposedly add nothing to the economy. The one gift the Republicans gave us was a tangible, concrete metric for just how much public workers do matter. The state shutdown caused epic unemployment, and that was just a loss of state workers and the contractors who depended on them. Think of losing all the local, school district, city, county, and federal employees. Look what impact losing just the state workers had on Minnesota. Is this a world we want to live in?
We know the horrific impact that losing state workers had. What happened when they came back? Well, Minnesota, as expected drop back three tenths of a percent. Now, since 1976, 417 months, there have only been five instances where employment has dropped as much as three tenths. Five times out of 420. That kind of job creation is unprecedented. After the break you can learn about the things that caused these singular employment gains.
Cross Posted at MN Progressive Project
As I said, there were only five times in our lifetime when unemployment dropped as much three tenths. Never since 1976 has unemployment dropped more than those five times. Sending our state workers back to work was one of those great instances. Obviously our state workers do matter. They matter so much their return to work is historical.
So what was going on during the other periods of historic employment gains? Ironically, two of the employment surges happened back to back in the fall of 1977. The other two employment surges were only separated by one month in the spring of 1983. So what was going on in the fall of '77 and the spring of '83?
There was only one big piece of legislation federally in 1977. It had a profound effect on Minnesota. The Food Stamp Act passed in September, 1977. This was the birth of the modern food stamp program. What followed was the largest two month growth in employment our state has seen since 1976 until this very day.
So what happened in 1983? There was historic employment growth in May and July. A massive Reaganesque tax cut? Some sort of liberating de-regulation? Not really.
You see, in April of 1983, with the help of a bi-partisan congress, Reagan bailed out social security. For the first time, Reagan added a tax to social security benefits for wealthy seniors. A tax increase for the wealthy? You bet. Reagan also made Federal workers eligible, adding a brand new class to the benefit. What followed was the second greatest two months of job increases in our lifetime.
So, to summarize: Losing only state workers will cause once in a lifetime unemployment losses. Minnesota has been extremely stable employment wise, but there were three big jumps in employment. First, right after the start of the Food Stamp program. Second, right after Reagan saved social security. Finally, we jumped by putting our devoted state workers back to work.
So, I leave you with two questions. What should we do with people who intentionally cause a recession? Lastly, are we now pretty certain that public workers matter?