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Everyone knows that the nation is now recovering from the worst recession since the Great Depression. But not every industry sank into recession or recovered from it on the same schedule. In fact, some did not sink at all, and some have not yet recovered. I thought it would be interesting to look at employment in the major industries and see how their experiences varied over the course of the years from 2007 to 2013.
The most important lesson to take away from all three graphs is that the low-tide mark of employment in most industries did not happen right after the financial crisis of 2008, but rather two years later, in 2010. When recession first strikes, employers generally try to hold onto skilled workers and hope for a quick turnaround to better times. They may have a cushion of resources that enables them to postpone layoffs
But when the economic slump drags on and the rainy-day funds are expended, employers start to shed workers. And as unemployed people draw down their own rainy-day funds cut back on their own expenditures, the slackening demand adds to the woes of employers. This is the recessionary spiral that can take a few years to hit bottom. Europe, which chose the path of austerity rather than stimulus, seems stuck in a valley, but the American economy, as a whole, started to turn upward after 2010.
But different industries have followed different paths. Let's start by looking at the first chart below.
Of these seven industries, only three follow the classic U-shaped curve of loss and recovery: the purple line, Mining, the pale blue line, Real Estate and Rental and Leasing, and the orange line, Arts, Entertainment, and Recreation. It's not surprising that Real Estate follows this U curve, because a dramatic loss of real estate value is what precipitated the financial crisis. (Note that, like property values in most locales, employment in this industry has not recovered the pre-recession level.) It's also to be expected that the Arts would lose business during recession, although the downward dip of the curve is really quite shallow. These jobs seem to be less sensitive than you might expect. Mining, on the other hand, actually owes its dramatic uptick in recent years not as much to the economic recovery as to the developing technology of fracking.
Management of Companies and Enterprises, the turquoise line, hardly declined at all during the recession and more recently has been making impressive gains. Everyone knows managers who lost their jobs in that downturn, but apparently jobs in management are less sensitive than those of rank-and-file workers.
The two lines at the bottom--for Utilities (green) and Agriculture, Forestry, Fishing, and Hunting (dark red) are almost level rather than curving. People need electricity, water, and other utilities no matter how the economy is doing, and a cutback in volume (for example, less use of electricity for manufacturing) has little effect on the number of people needed to work at the utility plant. Agriculture sometimes suffers from downturns in prices because of overproduction, but the rapidly rising world population and some diversion of crops to biofuel production seem have kept employment steady in recent years.
The really dismal story here is what happened to the Information industry--which consists mostly of the media, not computer technology. Like Mining, this industry has been affected mostly by technology, but not in a good way. As more and more media content migrates to the Internet and media companies consolidate, the need for workers has reached a permanently lower level than before the recession.