In today’s NYT, David Leonhardt digs up some obscure Labor Department statistics to document something I’ve been touching on in this blog: So far, at least, this recession can only be said to be the worst since 1982.
Including discouraged workers … the unemployment rate was 7.6 percent last month. Another 5.2 percent of the labor force was involuntarily working part time. These two groups bring the combined rate to 12.8 percent. … And there appear to be several hundred thousand people — mostly men — who stopped looking for work more than a year ago but would gladly take a good-paying job if one came along. They would lift the rate above 13 percent.
As bad as the number is, it is still not that close to its 1982 peak of 16.3 percent (or anywhere near its Depression levels, which were probably above 30 percent).
Now this recession isn’t over yet. By the time that it is, I wouldn’t be shocked if unemployment had surpassed its 1982 levels—making this the worst economic downturn since the Great Depression. Still, all indications are that it’s much closer in severity to the deep recessions of the mid-1970s and early 1980s than to the complete disaster that was the early 1930s.
The financial crisis of the past couple years has been more like that of the 1930s than anything since. But the government response—however bungled and expensive it’s been—seems to have kept the economic damage within bounds. So far.