Coming soon to U.S., 1 million jobs lost every month: Report

[Amerigo Vespucci]

Source: The Raw Story

London-based GFC Economics is making a frightening prediction: By spring 2009, the United States could be facing more than 1 million layoffs every successive month.

Expenses related to corporate debt, and muddy credit markets consumed by fear, are driving a fast-approaching "hard landing," claims a Sunday report in UK's Guardian.

"Corporate bond yields have rocketed since the credit crisis began as investors flee risky assets in search of safe havens such as US Treasuries. That effectively means many firms are being forced to pay eye-watering interest rates to borrow funds," the paper reported.

"November's jobs figures were so much worse than analysts had expected that the Dow Jones share index actually rallied by 259 points, more than 3 per cent, as investors bet that Washington would have to launch a major new rescue package for the economy even before President-elect Barack Obama takes over the White House in January."

Read more: http://rawstory.com/news/2008/Coming_soon_to_U.S._1_mil...

[theophilus]

1. Boo! I pedict this is not the case and that in the last half of

2009 we will look back and laugh, heartily, at such alarmism. Looks like a lot of folks want to see the new Administration fail. Tough noogie. Things are going to start looking better sooner than we think! IMO

[jaybeat]

3. Excuse me, but you've got a call on line 1.

It's reality, and its really pissed off about being ignored for so long.

Remember, the smart folks are saying this is going to make the First Great Republican Depression look "quaint" by comparison. Thinks weren't nearly as interconnected then as they are now. The so-called global economy is nothing more than a really long line of dominoes, based on stupidities like limitless growth (despite finite resources) and always being able to make the *other* guy pay for your mistakes. Well now, the other guy is us, and they are falling one by one.

The shit hasn't EVEN started to hit the fan.

Snowcones?

[Zhade]

5. Damn, that was an awesome reply.

The ostriches around here aren't doing us any favors.

[jaybeat]

12. Ah, shucks. Thanks! (nt)

[MadMaddie]

11. I have to agree with you

I have always thought the Globalization was a fools game. The falling dominoes is an accurate description.

Each country should be able to have it's own core manufacturing, finance, and farming (other critical) industries and be able to survive.

The US should be able to function on it's own without borrowing money from China or anyone else.

For countries that are poor and underdeveloped they should receive the knowledge, training and equipment and even human resources from other countries to get going. We should not be giving them money and then expect miracles to happen.

[Hawkowl]

32. Very well put

I never really thought of it that way. Its kind of analagous to viewing each country as a town that needs some basic local services provided locally to survive.

[Catch22Dem]

35. The "experts" also said $2 gas would never return...about 90 days ago

They also said the Earth was flat.

[Regret My New Name]

39. What? The earth isn't flat? Pffff, tell that to the people in Australia...

[Usrename]

15. I'm sure a lot of folks in the old Soviet Union said the same thing...

...during their collapse.

Once a superpower, always a superpower. (At least until the soup lines get real long.)

[dixiegrrrrl]

22. Here is a major difference between the Soviet Union collapse and the USA.

This comparison has been floating around the 'net for awhile now, and is still chilling.:

one example: housing.




link for other charts: consumer products, money, food, family, etc. ( scroll down for charts)

http://madconomist.com/what-if-us-collapses-soviet-coll...

[Hissyspit]

17. This is gonna get worse before it gets better.

Obama said as much today.

[geckosfeet]

23. Is that kind of like - "The fundamentals are strong"?

[Stuart G]

2. If this comes true...how will we feed everyone?

[Zhade]

6. ...

[tblue37]

14. Victory gardens. nt

[AlphaCentauri]

28. U. N.

[gratuitous]

4. Oh, are the new jobless numbers suddenly going to be honest?

Just in time for President Stupidhead's departure! But I'm sure it will be the merest coincidence.

[OhioChick]

7. That was my initial thought....

We'll soon be getting the "real" jobless numbers.

[Azlady]

31. my thoughts as well... the frightening truth will be told to us on or after 1/20

[Amerigo Vespucci]

9. If Bush waited until last week to admit we're in a recession...

...it stands to reason that there's more propaganda that his administration is catapultin'...

[roamer65]

8. I have heard rumors that many businesses are waiting until after Xmas.

..then whammo. I hope they are wrong.

[stillcool]

10. makes sense..

a last gasp kind of thing. Got to stop digging sometime.

[kysrsoze]

27. Unless they close their books in early '09, that's not the case

Those companies closing on 12/31 would want to have laid off workers in early December, so they can take the charges this fiscal year and get them off their books. I think reality lies somewhere between alarmism and heads in the sand. Yeah, it will be bad for awhile, but that doesn't mean it's the end of the world - especially with a new administration and Congress which may be able to get the hard decisions made.

[tomhayes]

13. I'm ahead of the game!

Got laid off in November. I'm a trendsetter!

[Maat]

16. Hang in there.

You are in our thoughts and prayers.

[Lorien]

25. I'm right on your heels!

I had three (freelance) jobs in as many months, and no more coming down the road. I have no idea how I'll get by from now on.

[FarCenter]

18. When health care jobs start to go, that will be the real signal

Health care is currently about 16% of GDP. We spend more on health care than on food.

But lots of the jobs are not doctor and nurses jobs. They are sevice jobs at insurance companies, adminstrators, record keepers, transcribers, receptionists, bookkeepers, etc.

But we won't be able to afford all that within 3-4 months and health care employment will start to decline. It will be the last of the service industries to go from growth to decline.

[llmart]

21. I may be wrong.....

and it's too late and I'm too lazy to look for this, but I think today's Detroit Free Press had an article about how health care jobs ARE starting to be affected.

[FarCenter]

24. In Detroit, it could be, but nationally health care employment went up

[customerserviceguy]

29. Ultimately

a lot of insurance company jobs are going to have to go. Giant megafirms with multi-million dollar advertising budgets, gold-plated executives, and armies of pencil-pushers trying to screw people out of coverage of everyday illnesses have got to shuffle off on to the shitpile of history.

[MikeNearMcChord]

19. And considering the number of guns this nation has,

The new anthem actually an old anthem, or as Dickie V would say
"IT'S LA MARSEILLAISE TIME BABY"
To arms, citizens,
Form your battalions
Let's march, let's march!
May a tainted blood !
Drench our furrows!

[sce56]

20. So bad my nephew joined the Army!

He did not even talk to me about it!

[Hannah Bell]

38. the recession solves the recruitment problem....

[bdamomma]

41. sad that these kids can't afford a College education are

being backed into a corner and leaves them the only alternative to enlist.

[Lithos]

26. Four comments

1) This is a worst case scenario painted purely for media exposure.

2) It assumes that the current fiscal stimulus does absolutely nothing and actually makes things worse by increasing the indebtedness.

3) The model being used is based on what happened to Japan and assumes that things are going to be caught between a double whammy of deflation coupled with rising debt. Deflation will kill the money supply (salaries, etc.) while rising debt will cause people to get further and further behind.

4) It also assumes nothing else happens which does things to secure assets and/or move real interest rates (for things you pay) down to zero.

From my way of thinking, allowing people to gain some relief via their mortgages coupled with a real cap on credit card interest would give most of what is necessary to fix the current problem. Fixing the incredibly broken (pun intended) bankruptcy laws which were enacted by the same corrupt (moral, etc.) Republican Congress and Presidency would also help people get out from a bad situation made worse by obvious corrupt meddling and gerrymandering of the economy by the Republicans designed to make the rich richer at the expense of the middle class.

[Lithos]

30. Too add

The type of scale of layoffs of a million or more per month would push the unemployment rate well above 10% very quickly. The loss of 533K jobs in November raised the unemployment to 6.7%. Current predictions are that unemployment will top out somewhere between 8 and 10%.

Economists predict the official rate will rise to at least 8% in 2009—and possibly as high as 10%. "The system is there; it just needs more money," says Peter Morici, a professor at the University of Maryland's Robert H. Smith School of Business.

(http://www.businessweek.com/bwdaily/dnflash/content/dec... )

The 8% expected figure is a total loss of an additional 2 million jobs and the upper end, worst case of 10% is 5 million. I personally expect it to be a little over 8%. Part of the reason I don't see it going much higher is that there are not that many jobs for companies to shed - the past 8 years saw some of the most anemic job growths ever so many companies are already working at the bone. What losses you will see will be the result of consolidations, resulting from the closure of business units or scaling back of capability (generally sales and manufacturing).

I'm not saying this is going to be easy, but that this is a complicated situation.

[percussivemadness]

36. some sanity in this mass hysteria

I grew up in the UK when unemployment was 22%, the world didn`t end.I remember getting ridiculed back in July for saying oil would be under 75.00 a barrel by February, in fact I believe some DUERs even bookmarked the link to remind me of it...

Very quiet now I must admit...

[closeupready]

34. Amen to ALL of this.

From your fingers to the PE's ears.

[TheKentuckian]

33. Hwll, its way over 10% now. Creative counting keeps the numbers in the non-alarming zone

but now even fuzz math can keep the numbers down.

This doesn't in any way account for the massive underemployment and stagnated or regressing wage problems. Kid yourself if you want but its getting massively ugly out here.

[Hydra]

37. Had we not lost 530,000 last month, I would have said

"1 million in a year, sure- in a month, no."

I fully expect this unless there is a MAJOR change, though. Job loss is a downward spiral in a consumer-based economy. Fewer people working ---> Fewer people buying things ---> Layoffs. Rinse and repeat.

[bdamomma]

40. job losses are spiraling out of control.