The news for EEs was particularly bad as the jobless rate more than doubled from 4.1 percent in the first quarter to a record-high 8.6 percent in the second. The previous quarterly record was 7 percent, in the first quarter of 2003.In the first quarter, the computer professionals' jobless claims was at 5.6%, but it is now standing at 5.6%. Good that it has not gone down too.
This is a two months old news. Now the economy is improving. We can see GDP is picking up in the US and Europe. Home sales are rising. We are certainly in the path of recovery. So we can expect that the unemployment claims for engineers would come down. Not so fast. Unfortunately that's not how it works. The economy is currently undergoing a jobless recovery, like it did back in 2001. This means that you can see rise in GDP and consumer price index, but the unemployment rate will remain fixed for a while. So the bad days are far from over. Lets hope we can get out of this hell soon.
UPDATED 23-AUG-09: Here is Paul Krugman affirming jobless recovery.
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hmmm! :-(
ReplyDeleteThere is no such thing as a jobless recovery. GDP has nothing to do with economic growth or health.
ReplyDelete@Anonymous
ReplyDelete"GDP has nothing to do with economic growth or health"
Well, GDP is not a single and sufficient indicator of the economic growth or health. But it is certainly one of the important factor. I disagree with your assertion that it has nothing to do with economic growth/health. It certainly has something to do, but not everything.
It's just like quarterback-rating. In fact, there are two many variables that no single factor can act as a sole indicator of economic health/growth.
"There is no such thing as a jobless recovery."
Jobless recovery is what you are seeing now and what you saw after dotcom bubble in 2000. Here is an excellent blogpost on that: http://philsbackupsite.wordpress.com/2009/06/10/is-the-us-economy-headed-for-a-%E2%80%9Cjobless-recovery%E2%80%9D/. But then, if you think GDP is a meaningless number, this blogpost would not convince you.
GDP does make a big different in economic growth. if a country has a very high GDP, then it is expected to have a very low unemployment rate like the old us which was 8%
ReplyDeleteand if a country has low GDP it is expected to have high unemployment rate like Zimbabwe which is over 90% of the entire population.
and about the EE i really feel sorry for them and myself. I am an Aero.E and i just hope things get better by the next 5 to 10 years or so... yes, im aiming for the PhD
@Anonymous (the second one)
ReplyDeleteA very good point. GDP is a good indicator of economic growth. I totally agree. That empirical relationship is called Okun's Law or Okun's rule of thumb.
But the problem is, there is a latency between the rate of change of GDP and that of unemployment. So you may still observe a good GDP with low unemployment for a period that follows a recession. But all countries will announce that the recession is over once they see this GDP growth without waiting for a shrink in unemployment. The countries may also turn into fiscal retrenchment thus expanding that latency.
I wish you the best success for your Ph.D.
It doesn't make a difference if the economy recovers. The situation that causes Engineers to be unappreciated and long term unemployed remains the same. It is the massive outsourcing / insourcing. Congress long time ago sold out on our countrty's professionals. So what is the point of investing in Education, when you no longer have any possibility of providing jobs to those that are educated. Lets hope they get outsourced sometime soon and know what it is like. It is said that a life is a terrible think to waste. I feel that I am full of energy, ideas and drive and yet sustaining oneself on UI and unable to pay the bills.
ReplyDeleteSadly, there are 101,000 U.S.-born individuals with an engineering degree who are unemployed. Not only that, 244,000 U.S.-born individuals under the age of 65 who have a degree in engineering are not in the labor market, which means that they are neither working nor looking for work, hence, they are not counted as unemployed.
ReplyDelete