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Weak Growth Means Few Jobs


...barring an unexpected shock, the job market does seem likely to improve, particularly over the longer term. Indeed, if the economy follows roughly the same recovery schedule as it did a decade ago, companies will begin adding more than 100,000 jobs a month by early next year. The fallout from the overinvestment in technology and the stock market bubble could make this rebound less robust, but the labor market is expected to tighten over the next decade, as the advance guard of baby boomers begins retiring and fewer young adults replace them in the labor force.

Already, the unemployment rate -- while likely to tick up again for a variety of reasons -- fell to 5.6 percent in September, its second consecutive decline. The economy continues to grow at a modest pace, and in recent weeks companies have asked employees to work longer hours, as often happens shortly before new hiring begins.

"There's not another downturn ahead," predicted Lakshman R. Achuthan, the managing director of the Economic Cycle Research Institute, one of the few groups to have forecast last year's recession. But, he said, "we're not talking about gangbuster job growth."

This jobless recovery has its own specific character, however.

Over the last decade, American companies have used new technology and strategies to become more efficient than they were in the 70's and 80's. The change is almost certain to benefit the country over the long term, allowing both incomes and corporate profits to rise. This year, however, the productivity increases have weakened the job market, because companies have been able to lift their output without hiring new workers."