U.S. Besieged by Unemployment. Energy and Big Government Are Lone Bright Spots
United States Unemployment: 8.1%
The U.S. is Besieged by Unemployment
Statistically, today's languishing job market is comparable to that of the miserable 1973-1974 recession. In the visceral, the present economic debacle is remarkable for the sheer speed of the deceleration. February's unemployment rate soared by 50 basis points over January 2009 and the debilitating job losses have been rampant across nearly all sectors of the economy. The bust has particularly effected real estate, construction, hospitality, financials, and manufacturing.
The devastation afflicting these industries is quite palpable per geographic perusal of the Bureau of Labor Statistics report. California, Oregon, North Carolina, South Carolina, Rhode Island, and Michigan highlight the job loss misery with shocking double-digit unemployment rates. Michigan's horrid 12% reading tops the Nation - yet again.
California, per its prevailing Gold Rush boom and bust mentality represents the epicenter for the economic fallout. The Golden State is the poster child for real estate speculation, sub prime loans, and foreclosures. The hapless situation has degenerated into morbid, paid tours of abandoned homes and tent city Mozilovilles (named after Countrywide's Angelo Mozilo) of homeless squatters unable to meet mortgage commitments lining California's interior valleys.
Sunny California's large tourism and hospitality business has also been shellacked in conjunction with the present 18-month economic meltdown. Traditional, middle market consumers are paring back on vacations and frills - electing to save (if one has not already been laid off) and slash debt; whereas the wealthy are balking at the pure extravagance that is a fashion faux pas in the wake of trillions of dollars vanishing from the U.S. Balance Sheet, only to be ultimately exchanged with seething, populist outrage.
The real estate / construction and tourism bust rationales behind California's 10.5% February 2009 unemployment rate also squares with the disastrous job markets for Florida, South Carolina, and Nevada. Alarmingly, the California contagion is spreading north into the Pacific Northwest region - which had been relatively unscathed by the debacle at this point last year.
Oregon's unemployment rate has doubled from 5.4% to 10.8% over the past twelve months.
Of course, the real estate collapse and the subsequent mortgage defaults promulgated the credit crisis that effectively shut down the banking system. All locales with heavy exposure to financials have suffered heavy job losses. North Carolina and its Charlotte banking powerhouse dubbed Wall Street South registered the sharpest year-over-year surge in unemployment of all 50 states. The Tar Heel state has had to endure the writhing rescue mission of Wachovia Bank while experiencing its very own jobless levels skyrocket from 5.2% to 10.7% in one year.
The demise of the banking sector has adversely affected the critical Mid-Atlantic to New England belt from Delaware to Massachusetts. Obviously, insurance, commercial credit, investments, and commercial banking are heavily concentrated along this important corridor that includes key financial posts at Wilmington, New York City, Greenwich, CT, and Boston. Rhode Island, which also features heavy exposure to both construction and tourism bears the brunt of the malaise and registers 10.5% unemployment - the highest in the Northeast.
The state of Michigan is an unmitigated disaster.
The Wolverine State exemplifies the abject demolition of the U.S. auto industry and the disintegration of American manufacturing at-large. Alarmingly, Detroit and Middle America has deteriorated deep into the clutches of recession, without any of the silver-lining, light at the end of the tunnel prospects of the Sun Belt and the Northeast. There has been no bubble to burst in the Midwest. Rather, the destruction of U.S. industry has precipitated a drawn out half-century of miserable Heartland decline.
The situation is one shade slightly above hopeless.
Energy, Materials, and Big Government Prevail
Energy producing and resource rich areas are currently boasting relatively stable employment levels.
West Virginia, Texas, New Mexico, Oklahoma, Montana, Wyoming, and the Dakotas - states that have been Blessed to straddle geologic formations overflowing with lodes of mineable coal, metals, minerals, crude oil, and natural gas represent the few bright spots of this report. All of these states identified with prolific natural resource production tally unemployment rates that are significantly lower than the 8.1% national average.
Wyoming, with its gargantuan Powder River Basin that serves as the largest source of coal in the United States, leads the nation with a scant 3.2% unemployment rate.
The happenings parallel a secular bull market for commodities that elevated oil to $150 per barrel and has propelled gold to $1,000 per troy ounce.
The aforementioned economic debacle which had been highlighted by skyrocketing energy costs fostered the emergence of President Barack Obama's Change Movement. Big Government is now identified as the solution to Society's ills - rather than the root cause of the problem. Today's predominant mindset at Washington is a fierce rejection of the Adam Smith laissez faire, small government model legislated by Ronald Reagan that appeared to collapse with the failure of Bear Stearns and the ensuing credit crisis.
Obama Big Government sentiment has resulted in a resilient economy for the Capital region as lobbyists, lawmakers, attorneys, and government agents descend upon the Nation's Capital. D.C., Maryland, and Virginia unemployment readings are remarkably low. For example, Montgomery County, Maryland bordering Washington, D.C. is flashing minimal 2.5% unemployment readings that are synonymous with boom times, not economic crises.
Washington, D.C. is recession proof.
U.S. Besieged by Unemployment, Sources:
Matt Woolsey, Is California Going Bust? http://www.forbes.com/forbes/2009/0413/101-best-cities-careers-california-going-bust.html
Bureau of Labor Statistics, Regional and State Employment and Unemployment Summary,
http://www.bls.gov/news.release/laus.nr0.htm
Bureau of Labor Statistics, Unemployment Rates by County in Maryland, http://www.bls.gov/ro3/mdlaus.htm
Published by Kofi Bofah
Kofi Bofah has been writing Internet content for one year. His articles appear on Associated Content and eHow, Trails and GolfLink via Demand Studios. He is originally from Silver Spring, Maryland. This... View profile
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- The U.S. is Besieged by Unemployment
- The Unemployment Rate is 8.1% as of February 2009.
- Energy, Materials, and Big Government are Bright Spots.
12 Comments
Post a CommentVery well researched piece. If I was in the market for a writer, I'd hire you.
Very well written.
great work on this
Heh heh, I'd move to DC, but didn't like the weather there much when I last visited. :oP There certainly are many more homeless folks on the streets of downtown San Diego these days (and I hope I won't be joining their rank!). :o( Looking to see how this auto bail out thingy goes and hoping for the best. Thanks for another enlightening read, Kofi. :o)
Nice article. The unemployment rate is at an all-time high and steadily climbing.
Good work. Some interesting things can be learned from the current recession. All the 'disaster' states, most notable Cali, Michigan, and Utah, are trying hard to beat the tourism drum, hoping to attract revenue from vacationers and conventioneers. It's a stupid quick-fix, because only third-world countries are known to build their entire economies around tourism. Additionally, the only reason DC is 'recession-proof' is because every time those cretins mismanaged the money the confiscate from working Americans, they can always take some more whenever they feel like it, whatever the reason! Gee, I wish I could improve my station in life by just taking whatever I want when things get tough, but I always understood that to be called STEALING....(oh, hmmmm!)
Good work. It's interesting to see which states are still prospering.
Very good, thanks.
Very well written piece.
Big Government is never the bright spot. We need less government now more than ever before. All we need from congress and senate is less legislation and more staying out of our lives.