job creation

How Many Jobs Are Needed to Keep Up with Population Growth?

The press quotes all sorts of figures for the number of monthly job gains needed to keep up with population growth. We see numbers like 80,000, 100,000, 125,000 and 175,000 thrown around like statistical snow as the number of jobs needed each month just to keep up. What's the right one? How many jobs are needed each month just to keep up with population growth?

Unemployment 9.6% for September 2010

The September 2010 monthly unemployment figures are out. The official unemployment rate stayed the same at 9.6% and the total jobs lost were -95,000. -159,000 government jobs were lost and private sector jobs increased by +64,000, with 16,900 of those jobs being temporary. -77,000 of the government jobs lost were temporary Census jobs. U6, or the broader unemployment measurement, jumped up to 17.1%.

A Decade of High Unemployment

If this isn't a definition of a Depression, I just don't know what is. Carmen Reinhart, University of Maryland Economist, is projecting a decade of high unemployment:

Ms. Reinhart’s paper drew upon research she conducted with the Harvard economist Kenneth S. Rogoff for their book “This Time Is Different: Eight Centuries of Financial Folly,” published last year by Princeton University Press. Her husband, Vincent R. Reinhart, a former director of monetary affairs at the Fed, was the co-author of the paper.

The Reinharts examined 15 severe financial crises since World War II as well as the worldwide economic contractions that followed the 1929 stock market crash, the 1973 oil shock and the 2007 implosion of the subprime mortgage market.

In the decade following the crises, growth rates were significantly lower and unemployment rates were significantly higher. Housing prices took years to recover, and it took about seven years on average for households and companies to reduce their debts and restore their balance sheets. In general, the crises were preceded by decade-long expansions of credit and borrowing, and were followed by lengthy periods of retrenchment that lasted nearly as long.

“Large destabilizing events, such as those analyzed here, evidently produce changes in the performance of key macroeconomic indicators over the longer term, well after the upheaval of the crisis is over,” Ms. Reinhart wrote.

Anyone Know Where We Can Find 10,600,000 Jobs?

Think about this. The U.S. needs 10,600,000 jobs just to get back to pre-recession unemployment rates. EPI:

The labor market is now roughly 10.6 million jobs below the level needed to restore the pre-recession unemployment rate (5.0% in December 2007). To get down to the pre-recession unemployment rate within four years, the labor market would have to add roughly 325,000 jobs every month for that entire period.

Even the OECD is reporting the United States needs 10 million jobs.

Creating jobs has to be a top priority for governments,” said OECD Secretary-General Angel Gurría, launching the report in Paris. “Cutting unemployment and fiscal deficits at the same time is a daunting challenge but it needs to be tackled head on. Despite signs of recovery in most countries, the risk remains that millions of people may lose touch with the labour market. High joblessness as the new normal can not be accepted and has to be tackled by a comprehensive policy strategy.

Even worse, the OECD estimates it's member countries need 80 million jobs!