Those of you who remember the promises associated with the federal stimulus packages approved during the closing days of the Bush administration and the early days of the Obama administration might be interested in Gene Esptein‘s latest “Economic beat” column in Barron’s.
If we extrapolate based on recent progress, one key indicator of recovery is now just 12 months away. According to the employment report for May released Friday, nonfarm payroll employment in the private sector rose by an average of 163,000 over the past three months, putting the total number of jobs on private sector payrolls as of May at 113.789 million.
That’s still nearly two million lower than the January 2008 peak of 115.668 million, but at an average monthly increase of 163,000, we’ll finally exceed the January ’08 peak by May of next year. No job market since the Great Depression has taken even half that long to recover its losses, but these are clearly unusual times. …
… The unemployment rate will continue to tick down. But at 7.6%, it’s down just six-tenths of a point from 12 months ago, when it ran 8.2%. At that pace, it won’t approach Federal Reserve Chairman Ben Bernanke’s objective of 6.5% until the end of next year. As one measure of how far the labor market has slipped, in January 2008, the unemployment rate was 5.0%.
