Unemployment Statistics Not Encouraging

               The Bureau of Labor Statistics recently released their unemployment figures for the past month, and to anyone but the unrealistically optimistic or the completely oblivious, the news was not comforting. While unemployment rates alone do not strictly define the health of an economy, they are an important matrix. An ailing economy does not tend to spur job growth, and a suffering economy can quickly purge huge numbers of jobs and, as a direct consequence, leave a wake of unemployed workers and their resulting bankruptcies from inner city Los Angeles to the affluent suburbs in Suffolk County, Long Island. As the relative health of our economy directly affects employment, so too do employment statistics serve to help measure or diagnose an economy as a whole.                  

The statistics released recently cannot help but be a sobering reminder of the state we are in. In the last week, new applications for unemployment insurance or jobless benefits leaped to a high not seen in sixteen years. Not since July of 1992 have new claims increased so dramatically in one week, and that was when the country was on its way out of a tough and relatively protracted recession. The fact that we are seeing similar numbers now, at what is presumably the beginning of our troubles, is disheartening.  

While week-to-week statistical spikes make for dramatic news bulletins and headlines, they are not always as accurate a measure as numbers gathered over a longer time span. Unfortunately, the four-week average for new jobless benefit claims rose 506,500: a twenty-five year high. Additionally, the number of unemployed workers who continued to claim benefits was over four million, a number unmatched since 1982, when the United States was in the depths of arguably the worst recession since the Great Depression. Making matters worse (or at least more uncomfortable) is the fact that every president since Kennedy has redefined unemployment to boost their economic growth figures. Factor in the folks who have been purged through redefinition of “unemployed,” and the rates could be twice as high.                  

Throw into the mix the fact that the “Big Three” automakers are teetering on the brink of collapse (which, depending on who you ask, could result in up to 50 million more lost jobs), and the picture becomes even more grim. While lawmakers debate the merits of a “bailout” of these companies, the people who work for the automakers are bracing for the worst. They are cutting spending as if they are already unemployed, and this decreased influx of cash cascades throughout the entire economy. This in turn creates a situation where more jobs are cut, (and none are created) so that companies can keep their proverbial heads above water.                  

The resulting economic picture is dismaying, to say the least, and unfortunately we have not seen the worst of it. As people continue to struggle and the unemployment rate rises, so too will bankruptcy rates rise. Businesses will continue to fail at faster rates, and more people will become part of the growing pool of the statistically unemployed. The odds of having to take drastic financial measures are increasing, and it is important to make educated decisions and not act desperately when confronted with seemingly intractable financial stress. If you are in a situation (as millions of others in our country currently are) where you are debating declaring bankruptcy or a similar measure, be sure to first contact a knowledgeable bankruptcy attorney such as those found in Nassau County, who can guide you through these tempestuous financial waters.   –

This entry was posted on Monday, December 1st, 2008 at 7:02 am and is filed under Economy & Politics, Long Island Bankruptcy. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.