Slow Job Growth Compared to Earlier Business Cycles

While Pennsylvania’s employment situation has improved gradually since the recession of 2001, employment growth has trailed that in previous economic expansions. In fact, job growth in the current business cycle has lagged behind that in every comparable period in the post-World War II period (Figures 5 and 6).

In many of the earlier business cycles, job loss early in the cycle exceeded that in the current one, reflecting the mildness of the March–November 2001 recession. Once the recession ended, however, job growth was much slower in the current recovery than in previous ones. (While Figures 5 and 6 show only the four most recent economic recoveries that lasted longer than 18 months, job growth was also slower than during all other economic recoveries since World War II that are not shown.)

The fact that job growth has been slower than in previous expansions helps explain why wages today still have not recovered to their previous peak, despite close to six years of economic growth.

This page is an on-line summary of a portion of the full State of Working Pennsylvania 2006 report available for download from www.stateofworkingpa.org. © 2006 Keystone Research Center - www.keystoneresearch.org.