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June 1994, Vol. 117, No. 6
The 1990-91 recession: how bad was the labor market?
Jennifer M. Gardner
T he United States
experienced nine periods of widespread economic decline over the
past 46 years. These periods-commonly referred to as
recessions-were characterized by sharp and nearly simultaneous
contractions in many activities, such as housing construction,
car sales, and the placing of orders for durable goods. This
economic weakness has always been accompanied by decreasing
employment and increasing unemployment.
The most recent recession officially started in
July 1990, bringing to a close the Nation's longest peacetime
expansion on record. This recession officially ended about 8
months later in March 1991.1 By most economic
measures, the 1990-91 downturn was mild compared to previous
contractions. Yet, several factors unique to this recession and
its aftermath made its impact on the U.S. work force quite
severe:
- The labor market continued to deteriorate
long after other economic indicators began to improve and
the official ending date of the recession was chosen.
During earlier business cycles, in contrast, the turning
points for nonfarm employment and for unemployment were
nearly coincident with the official trough months of
recessions.
- Employment declines were more widespread
across the major occupational and industry groups in the
1990-91 recession than in past contractions. White-collar
workers in general, and workers in the finance,
insurance, and real estate industry were at greater risk
of losing their jobs in the early 1990's than at any time
in the past. Also, the rate of employment decrease in
both wholesale and retail trade was nearly twice that of
the averages of prior contractions.
- A much smaller share of the unemployed who
lost jobs in the recent recession expected to be rehired
when the economy improved than was the case for workers
losing jobs in other downturns.
This excerpt is from an article published in
the June 1994 issue of the Monthly Labor Review. The full
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Footnotes
1 For a detailed explanation of the procedure used in
determining the starting and ending points of recessions, see
Geoffrey H. Moore, Business Cycles, Inflation, and
Forecasting (Cambridge, MA, Ballinger Publishing Co., 1983), pp. 3-10.
- Related BLS programs
Labor Force Statistics from
the Current Population Survey
National Current Employment
Statistics
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- Related Monthly
Labor Review articles
Women and jobs in recoveries: 1970-93. July 1994.
-
- Job losses among
Hispanics in the recent recession. June 1994.
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- Long-term
unemployment in recent recessions. June 1994.
-
- Industry employment and the 1990-91
recession. July 1993.
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- Women and jobs in recessions: 1969-92.
July 1993.
-
- Recession swells count of displaced
workers. June 1993.
-
- Atlantic and Pacific coasts' labor market
hit hard in early 1990's. February 1993.
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