Where will all the new jobs come from?

Consider this: Despite a rising population, non-farm payrolls in the United States are lower than they were a decade ago.


The unemployment challenge is not just cyclical, it is secular. Sectors of the economy with a challenge include (click on images to enlarge):

  • Financial services (zero growth in 10 years)


  • Construction (-1.2 million jobs in 10 years, a decline of 18%)


  • Real estate (lower than ten years ago, having peaked in 2006)


  • State government (up 9% in ten years, but down 0.5% from Aug 2008 peak and still declining)


  • Local government (up 10% in 10 years, but down 1% from Sep 2008 peak and still declining)


  • Automobile retailing (way down in ten years, having peaked in 2005)


  • Automobile manufacturing (catastrophe. Down 36% in ten years.)


  • Retailing (this is grim too)


Over the near-term at least, none of these sectors of the economy is likely to power the next upturn in employment. So, when I say that this is looking like a structural issue (see here and here), you can see what I mean. I know these numbers are all backward looking.  But, I don’t see any of these sectors jumping off the table right now as a job growth engine.

Where will all the new jobs come from?  If you say healthcare, I’m with you.


And the data also point to the federal government as well.


Any other thoughts?


Seasonally Adjusted Non-Farm Payrolls, Historical Data – Department of Labor


Edward Harrison is the founder of Credit Writedowns and a former career diplomat, investment banker and technology executive with over twenty five years of business experience. He has also been a regular economic and financial commentator on BBC World News, CNBC Television, Business News Network, CBC, Fox Television and RT Television. He speaks six languages and reads another five, skills he uses to provide a more global perspective. Edward holds an MBA in Finance from Columbia University and a BA in Economics from Dartmouth College.


  1. LavrentiBeria says:

    OK, so after getting his engineering degree, Bobby’s next job is emptying bed pans in the same old folks warehouse that processed his grandmother. But he can always point to having financed the six-figure salaries earned by the professors that got him there, can’t he? He has that much social utility, hasn’t he?

    See how well the ruling class has run the economy? They denude us of jobs by off-shoring our industries to countries with slave labor, buy off willing politicians to remove the legal constrains and then find ways to extract what remains of the peoples’ wealth with usurious interest rates. And the best this country can manage are tea parties featuring knuckle draggerers concerned about deficits! Oh, by the way, I forgot to tell you, Bobby’s been laid off.

    • That about sums it up. The thing about tariffs too is that all the jobs are
      already gone. It’s not like raising the price of Chinese goods will increase
      the number of American goods bought because we don’t make those things any

      De-globalization is coming. I guarantee you this.

      • LavrentiBeria says:

        I should like to have benefit of your vision of what de-globalization will entail, just in broad outline, a thumbnail sketch if you will.

        Perhaps one day the way might be open to a kind of Five or Ten Year Plan bent on the reindustrialization of the United States. I don’t see that as even vaguely possible, however, without first an end being brought to the hammerlock currently being imposed on our democracy by the clique of lobbyists and whore politicians that rules us. To a man, they must go.

        • I’m still thinking about it right now. I’m drawing a bit of a blank on good ways out of this. I think I need to write up my thinking and run it by people here and at Naked Capitalism.

          Some of the things I’m thinking about:
          1. Global labor arbitrage
          2. Internet as a globalization vehicle
          3. Tarrifs
          4. Education
          5. Manufacturing vs. services
          6. Wealth, progress and GDP

          A bunch of other stuff as well. The overall gist of what I end up with is that it’s hard to prevent global wage arbitrage in the service sector when the Internet allows the outsourcing of just about any job. And education isn’t going to prevent people from having their incomes cut due to the arbitrage.

          I’ll post when I can put this together coherently.

  2. Where will the jobs come from? Easy: just bump up demand, and consumers will run around buying stuff – more houses, more cars, more holidays, better clothes, education and computers for their kids, etc etc etc. I don’t see the problem.

  3. RL says:

    Easy. The jobs will come from the federal gov and the militaries.

  4. Attitude_Check says:

    Jobs won’t come back until it becomes economical to build and produce things in the US — at sufficient to return the trade balance to being balanced. The long trade deficit has been a generational “bleed-out” of $’s into the worlds CBs as global “reserves”. This is a direct result of currency manipulation. The manipulation is via a co-dependent relationship between US “strong-$” beneficiaries and Exporting nations (China, Japan, etc.) weak currency beneficiaries.

    It will be slow, but Jobs will return when imports become expensive enough that it becomes economical to re-focus Capital to domestic production. Of course the longer we try in print our way to prosperity, the more capital destruction occurs, and the lower our asset prices will need to be to be able to afford to re-tool and re-create the manufacturing we “off-shored”

  5. dansecrest says:

    Health care is already absorbing too many jobs, like finance & real estate before the fall. Government intervention is needed to deal with this structural issue…

  6. js says:

    If we look at previous severe recessions it appears that war or military spending has often been a significant factor in bringing a country out of a recession.

    Edward, you’ve talked about this before – Military Keynesianism.

    What do you think Edward?

    While it is very noble to think that a health care revolution is going to take place and create a huge number of jobs (which even if it does happen it appears that government has already corrupted true health reform) I feel that military spending is more likely to be used.

    We think we have come along way in society, in reality it appears we have learned very little over the last century, whether that be economics, health care, or military spending.

    • That is certainly what I fear. When you hear Marc Faber talk about future
      scenarios, he always mentions wars. I agree with him that military
      confrontation becomes enticing when the economy is poor.

      I havent been very optimistic about where this is headed of late. If we get
      a second dip, general civil strife will increase markedly and confrontation
      becomes more likely.