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Jobs in 2005: How do they compare with their March 2001 counterparts?
Julie Hatch Maxfield
The 2001 recession lasted 8 months, but nonfarm payroll
employment did not
recover to its prerecession level until early 2005.1
In addition, the average workweek remains shorter than it was at the start of
the recession, and earnings have not outpaced inflation. Based on these
observations, one may ask, "How does the average job, 4 years after the
recession ended compare, in terms of hours and earnings, to the average job at
the start of the recession?" What aggregate effect do these jobs have on
the economy? The indexes of aggregate hours and payrolls provide insight on the
differences between pre- and post-recessionary jobs.
This article highlights employment changes in each industry sector during the 2001 recession and subsequent recovery period and compares the changes with previous recessions and recoveries. It begins with an examination of employment, because shifts in employment can impact hours and earnings. Employers tend to respond quickly in times of economic downturns by reducing the average workweek. Each private-sector industry’s average weekly hours are reviewed to gain insight into the health of that sector and to explain movements in the average workweek for all private-sector workers. Next, the article examines aggregate hours—the product of average weekly hours and employment. Average hourly earnings typically grow over time, but the rate of growth fluctuates with changes in the business cycle. Lastly, the article looks at the combined product of employment, hours, and earnings—what is known as aggregate payrolls.
This excerpt is from an article published in the July 2006 issue of the Monthly Labor Review. The full text of the article is available in Adobe Acrobat's Portable Document Format (PDF). See How to view a PDF file for more information.
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Footnotes
1
U.S. business cycle expansions and contractions are determined
by the National Bureau of Economic Research (NBER). For information, see http://www.nber.org/cycles/main.html.
Data on employment, hours, and earnings used in this article are from the
Current Employment Statistics (CES) program, which each month surveys 160,000
nonfarm businesses representing about 400,000 establishments. For more
information on the CES program’s concepts and methodology, see BLS
Handbook of Methods, Bulletin 2490, (Bureau of Labor Statistics, April
1997). CES data are available on the Internet at http://www.bls.gov/ces/.
Data used in this paper are seasonally adjusted unless otherwise noted.
Related Monthly Labor Review articles
Payroll
employment in 2005: recovery and expansion. — Mar.
2006.
Post-recession trends
in nonfarm employment and related indicators.—Sept.
2004.
Employment in services industries affected by recessions and expansions—Oct.
2001.
On the decline in
average weekly hours worked—Jul.
2000.
1990-91 recession, The: how bad was the labor market?—June
1994.
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