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The decline in manufacturing employment makes recoveries more difficult

at 10:26 AM ET, 02/02/2012

Back when the manufacturing sector employed a greater share of Americans, there was a fairly predictable rhythm to employment swings in recessions. Factories would lay off workers temporarily when the downturn hit, and then re-hire those same workers when demand picked back up. In 1971, manufacturers rehired 85 percent of the same workers they’d laid off.

But that’s no longer the case. In the 1981 recession, 20 percent of workers were laid off temporarily. This time around, just 9 percent were. Here, via a new Pew report, is the graph:

It’s a vicious cycle: The past two recessions have hit manufacturing especially hard — and most of those jobs never returned. The resulting rise in permanent layoffs has, in turn, made job recoveries harder and slower. As the Pew report details, it’s one reason why there are now 4 million “long-term unemployed” who have been out of work for more than a year.

 
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