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Jobless Rate Soars – Technology to Blame?

June 8, 2009

There are so many indications that THIS recession is different from others in the past as we have well seen. Aside from the fact that it is now the longest since the 1930’s, the large scale growth of the U.S. population has skewed employment statistics drastically.

Below is an interesting look into how the rising population along with significant expansion of productivity (aka : technology advances taking the place of human workers) has made its mark.

One has to wonder how we will actually add payrolls at the rate necessary to meet the long term goals of a growing economy. With less manufacturing and fewer employed, the vicious cycle should create, at best, a slow recovery. The best shot for sustained growth is going to be a breakthrough in something that we have to discover.

Recall that the 2003-2007 growth was actually a combination of real estate/credit expansion as well as technology advances allowing for the U.S. to ironically, get into the predicament we find ourselves in today – Loaned to the MAX with less overall employment needs.

(Click chart to enlarge – Source – Bloomberg)

jobsvsopens

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Disclosure: Horowitz & Company clients may hold positions of securities mentioned as of the date published.

Written by Andrew Horowitz · Filed Under Economy, MarketMash, Markets 

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One Response to “Jobless Rate Soars – Technology to Blame?”

  1. Amir on June 8th, 2009 6:28 pm

    "Below is an interesting look into how the rising population along with significant expansion of productivity"

    I do not see in your graph population numbers, or productivity numbers, so how come you reach such a conclusion from this graph?

    The graph is just a plot of jobs/jobless.
    It is not that I disagree with you (I partially agree), but you cannot just put any graph and then make claims cannot be deducted from it.

    Population growth is double-edge sword: More people –> Bigger market (like China?) –> More products to buy and sell –> More profits –> More employment to service the bigger market.

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