Some economists have begun tentatively saying that the worst recession since the 1930’s may be ending. They point to improvements in manufacturing orders, housing starts and other typical leading indicators as reason for optimism. That’s good but then there’s unemployment.
Unemployment is always a lagging indicator. It lags when we go into a recession and it lags as we come out. That’s why the current recession, which started in 2007 didn’t show appreciable unemployment for a full year until December 2008. An unscientific sampling of states shows how difficult the recession has been on manufacturing and high tech with Michigan having a whopping 15.4% unemployed followed by California at 11.6%. Surprisingly states like Wyoming (5.7%) and North Dakota (4.6% not shown) look like they are in full boom, and they are. There is an oil boom happening in the interior Rockies in the area over the newly discovered Bakken oil formation.
Still comparatively few people live in Wyoming and North Dakota so the low percentages don’t contribute as much to the overall health of the American workforce (national average 9.7%).
As the third and fourth quarters unfold I expect to see more activity in California and other high tech states. Already I am seeing signs of increased marketing activity and even company formation in Silicon Valley. I hope for everyone’s sake that this long recession will be history soon.