The U.S. lost more jobs in 2008 than in any year since 1945 as employers fired another 524,000 people in December, indicating a free-fall in the economy just days before President-elect Barack Obama takes office.
“Consumers are now going to get more and more scared at the prospect of losing their job,” said Nariman Behravesh, chief economist at IHS Global Insight in Lexington, Massachusetts. Obama’s proposed fiscal stimulus “needs to be big, needs to be bold, needs to be swift. If they can do something quickly we can limit the hemorrhage by mid-year.”
The pictures pretty much summarize the current outlook, so without further comment…
Figure 1: Nonfarm payroll employment, seasonally adjusted, various releases. NBER defined recession dates shaded gray (assuming recession has not ended by 2009M01). Bloomberg consensus for December in teal square. Source: BLS, employment situation, various releases, via St. Louis Fed FRED II, Bloomberg.
Figure 2: GDP (light blue bars), GDP from e-forecasting, 1/9 (blue), and from Macroeconomic Advisers 12/16 (red) in Ch.2000$, SAAR. NBER defined recession dates shaded gray (assuming recession has not ended by 2009M01). Source: BEA, GDP release of 23 December, e-forecasting 1/9 and Macroeconomic Advisers [xls] 12/16 release.Update, 11am Pacific In response to Brian Quinn‘s comment on part time work rising.
Figure 3: Log Nonfarm payroll aggregate weekly hours (blue), and Log Nonfarm payroll employment (red), seasonally adjusted, normalized to 0 in 2007M12. NBER defined recession dates shaded gray (assuming recession has not ended by 2009M01). Source: BLS, employment situation, December release, via St. Louis Fed FRED II, and author’s calculations.
Originally published at Econbrowser and reproduced here with the author’s permission.