Jobless Recovery Seems Likely
September 18, 2009 by Miranda Marquit
Filed under Finance
One of the issues that is affecting the economy to a great degree is the unemployment rate. Even though other economic data is providing hope for an end to the recession, there are now concerns about a “jobless recovery”. The fact that there are now five states with an unemployment rate above 12% seems to support this state of affairs.
What is a jobless recovery?
A jobless recovery occurs when the economy begins to grow, but payrolls do not follow suit. Instead, economic recovery is slow and relatively weak, encouraging companies to be slow about hiring new workers. Instead of hiring, companies remain focused on increasing the bottom line as the economy slow moves into a state of growth. The last time we had a jobless recovery was at the end of the tech bubble burst, in which took two years for payrolls to start growing again, even after the recession ended.
It is quite likely that we will see something similar this time around as well. And this will further slow economic recovery. Businesses should be prepared for a recovery that lasts well into 2010 — and possible to 2011.
Image source: Daylife
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