Jobless Rate Steadies but Number of Workers at Lowest Rate Since ’83

The low percentage of Americans holding jobs in the summer of 1983, at the peak of unemployment amid the early 1980s recession, was a blip in an era of generally high workforce participation marked by two-earner households. But it was not a normal level since the 1950s and early 1960s, when single-income households were common. A workforce participation rate in 60% to 65% range has been the norm since the 1980s.

Sifting through the data, financial blogger Doug Short notes what is perhaps the most worrisome statistic in the BLS report: a long-term rise in the duration of unemployment to just under twice the level of the early ’80s recession. The average length of unemployment is now 40.4 weeks, compared to 21.2 weeks in 1983 and 32.6 weeks one year ago. Says Short in his Advisor Perspectives blog: “We are perhaps seeing a paradigm shift — the result of global outsourcing and efficiencies of technology. The post-recession duration of unemployment continues to rise.”

Short cites a chart from the Calculated Risk blog showing the drop in employment in the current recession is far more severe than all other post-war recessions — with 5% to 6% declines from peak employment; that figure in other postwar recessions clustered between 2% and 3%.