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7th May
2010
written by Susan

Something’s up with this recession. It feels really different from what I remember in the past. My sense is that we’re in a kind of trance-like state, numb and stunned because we’ve been displaced on a grand scale - like the poor spider that got the “vacuum cleaner treatment” after a desperate tissue scooping attempt failed to net positive results.

Vac power on. Wooshhhh. Gone.

No one seems immune from the impact of this economic chaos. It’s swept up a diverse array of folks – across numerous industries, with varying levels of expertise and longevity, within all sizes of firms. Many of my family members, friends, and contacts are finding themselves unemployed or grossly under-employed for long periods of time. Most of you heard a giant sucking sound as the work, the 10 or 20% of gross pay, the special projects, the overtime, the 401K’s, the vacation, and the benefits disappeared. It’s just plain confounding, confining, and crazy; sort of like a spider’s life inside the vacuum bag.

I’m not exaggerating or being dramatic here. The impact of a recession on employment is well documented.

So how bad is it?

(click on the image below for a larger view) (use the left arrow button to return to this spot)

  

The trend doesn’t look real promising to me. Notice how much longer it took to achieve job loss recovery after the recent events of 1981, 1990, and 2001. Based on current trends, it’s logical to assume that we’re in for a prolonged recovery this time as well - which puts us at 47 months plus plus. UhOh, we’re not even half way there.

For all of you who have reported that it feels like we’ve fallen off a cliff – your proof is in the chart. That red line tracks one massive descent. No employment recession has been as deep (and perhaps as long – TBD) as this one.

Now you have the facts; the truth of the matter is that the employment situation is dire! Just today, the BLS reported an increase in the unemployment rate to 9.9% because 499,000 more Americans are out of work. On the other side of the equation there was an uptick in job creation; 290,000 jobs added sounds pretty good. It represents a start, but how could it possibly be enough given where we are?

Like some of you, I’m not content staring at harsh reality/facts without wanting to do something to improve and or change the situation. I believe that the way ahead involves a radical TRANSFORMATION of the dynamics of our present situation. We’ve got the power to get beyond current circumstances; let’s use it! We’ve got the compassion to  help others on the way; it’s why we hurry outside with the vacuum bag to release our spider friend and why we read/write blogs.

For ideas on the TRANSFORMATION, let me quote from an earlier post of mine:

“We know all of us are going to have to readjust. To redefine our goals, dreams, expectations, and values as they relate to work, the economy and our prosperity.  The future may be a little foggy…but with some focused effort and collaboration we can find ourselves heading in a positive new direction.”

We are committed to presenting ideas for charting a new course. Starting next week, every post will attempt to identify potential “next steps” in building your personal ROADMAP for the journey ahead.

Getting from where we are to where we need to go is a process – one we embrace whole heartedly! Your feedback and insight are invaluable to helping us build that BRIDGE TO SOMEWHERE

I ask you again – Are you in?

My thanks to the folks over at Calculated Risk who generated the chart. I visit their site several times a day to get insight related to the developing/evolving economic situation. I invite you to do the same!

http://www.calculatedriskblog.com/

7 Comments

  1. Darryl
    09/05/2010

    When you speak of re-evaluation you speak of what should be considered normal human behavior. I have managed to stay way ahead of the current downward employment trend. My income has remained stable as I continue to contribute to my retirement, savings and other investments. WHAT I HAVE LOST: 3% matching 401k down to 1%. Bonus reduced by 20%. Without skipping a beat I immediately raised my contributions to what was lost and I raised my weekly savings contributions by $150.00. You ask ” How can he do this? How do you pull money out of thin air?. This is only a result of re-evaluation.

    Re-evaluation, To me, means that we should always be prepared for various financially negative impacting situations that may/will occur in our lives and without notice. I have a simple but very affective plan that is consistently in use. I constantly chart and track my income on a daily, weekly and monthly basis. You see we only have a certain income potential but there are an infinite number of ways to spend what we earn, hence credit….. We live in a society of insatiable urges to have this or that.

    Recently I have been faced with a reduction in income due to a severe injury that I received while at work. Although I will recover, I will have about 6 weeks before I will be back to my full potential. fortunately I have already put into motion my plan for such an event.

    I do believe that we are on a long road to recovery and I don’t see much improvement till 2014 or so. Plan on saving and investing as much as you can. Do your homework and be smart about what you spend. Don’t follow the masses and keep a simple financial plan. Even if all you can save is $25.00 per week then do so. It’s a start and a good one. Constantly re-evaluate. It makes sense.

    I’m in!

  2. 11/05/2010

    Thanks for the wise advice Darryl. Your financial discipline is something I admire!

    Sorry to hear that you have been injured at work – may you have a complete and rapid recovery.

  3. 17/05/2010

    Thanks for the information! My spouse and I are looking for major changes and this website just might be the tipping point we needed!

  4. 18/05/2010

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  5. 21/05/2010

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  6. 28/05/2010

    Great points you have made. Is it our society that has built up our expectations of what we should do and be. We can not follow the old road map our parents had for retirement. We must be creative, resilient and have courage to make changes in our lives. ones we never expected to make. I am determined to achieve greater achievements than I did before. I ask myself everyday.” What do I need to change within myself to get out of this situation?” “What do I need to do today?”

  7. 29/05/2010

    Thanks for this post, I am considering talking about the same in my blog.