Jobs Gap from the Past Four Recessions, by Month Since Recession Started

Each month, The Hamilton Project calculates America’s “jobs gap,” or the number of jobs that the U.S. economy needs to create in order to return to pre-recession employment levels while accounting for changes in the population. February 2015 marked fifty-three consecutive months of positive job creation in the United States. In the chart above, The Hamilton Project applies the same jobs gap methodology to earlier recessions, in order to offer some historical perspective. This chart illustrates the evolution of four jobs gaps, corresponding to the recessions of 1981–82, 1990–91, 2001, and 2007–09. The horizontal axis tracks the number of months elapsed since each recession began. When a line climbs back to this axis, the recovery is complete: enough jobs have been created to return the employment-to-population ratio—adjusted for changing demographics—back to its pre-recession level. Looking at the figure, it is evident that successive recoveries have become longer. The 1981 jobs gap took 41 months to close. The 1990 jobs gap, which was not quite as deep, lasted about a year longer, closing at 51 months. The subsequent two recessions were much more severe, taking over two years to bottom out. The jobs gap from the 2001 recession never closed at all. In fact, the slight dip at the end of the purple line actually coincides with the onset of the Great Recession. Put differently, even if the current jobs gap of 3.3 million were to close as projected in 2017, employment levels will have returned only to their relative strength of 2007; they would still be significantly below their relative standing in 2000.