Chart of the Day: GDP Growth vs. Growth in Employment

John Hussman’s latest weekly newsletter talks a lot about the anger that Americans feel at being told the recession ended in June 2009 when the economy is still losing jobs. He makes some very good points. See this Economix piece which echoes some of these.

I put it this way last week:

Here’s the problem: the term ‘recession’ is meaningless in the real world. It always has been. When a recession ends or begins tells you nothing about the outlook for the economy. It tells you nothing about the jobs picture. The NBER is a dating committee – that’s it.  They determine when an economy is contracting and when it is expanding – not when it is healthy or unhealthy.

Here’s the thing that caught my eye though: Hussman’s chart on GDP growth plotted against employment growth.

GDP vs. Employment

When the quarterly change in non-farm payrolls is weak, GDP tends to be weak too. Unless we see greater job growth, GDP growth is going to be weak.

Much more at the link below.

Source: Not Yet Out of the Woods – John Hussman

  1. Charles says

    This chart speaks volumes. Job growth will resume when economic activity accelerates and businesses require additional workers. Stronger growth in manufacturing earlier in the year was met by increased hiring among manufacturers, according to govt. data.

    Charles Sherry

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