The 1990-91 recession: how bad was the labor market? (EXCERPT) Monthly Labor Review Online, June 1994

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 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 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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