The headlines for December 5th‘s Labor Department Payroll Survey trumpeted a decline of 533,000 jobs in November 2008, the worst since 1974, with the separate Household Survey showing a rise in unemployment to 6.7%. With revisions to the October and September payroll numbers bringing job loss down for those two months by 199,000, that means there have been 1.91 million jobs lost in the United States this year; the unemployment rate stood at 4.9% at the beginning of the year.

As for the financial services sector, Labor reported 32,000 jobs were lost in “financial activities,” for a total of 142,000 jobs lost in the sector over the prior 12 months. In a report tracking job losses in financial services for the year through October, Challenger, Gray and Christmas counted 129,150 jobs lost, which did not count additional planned job cuts since then of 53,000 at Citigroup and 11,000 at UBS, to name just two.

However, Bill Knapp, investment strategist of MainStay Investments, put the “grim” numbers into context in a note sent to clients on December 5. “Today’s labor force is approximately 155 million, while in 1974 it was approximately 92 million, a nearly 70% increase. So, on a normalized basis–to really be as bad as 1974–today’s number would have had to be around 900,000 jobs lost.”

Acknowledging that the National Bureau of Economic Research had voted November 28 to declare that the country has been in a recession since last December, Knapp points out that the NBER “usually recognized downturns well after the half-way point. The worst post-war recessions have lasted a total of 16 months, suggesting we may be in line for a turnaround in the second quarter of 2009.”