Reports from the Economic Front

a blog by Marty Hart-Landsberg

Monthly Archives: November 2008

Economic update

The economic mess is getting worse:

The state of Oregon is predicting a major revenue shortage—perhaps as much as a billion dollars—and thinking about cuts.  The Oregon Center for Public Policy says it is a revenue problem not a spending problem and suggests targeted ways to boost revenue–like deal with the ever shrinking corporate contribution to our taxes.

Unemployment is rising sharply, but we have a broken system.  For example, “just 37 percent of unemployed Americans are receiving jobless benefits today, down from 42 percent during the 1981-82 recession and 50 percent during the 1974-75 downturn. Americans today receive a maximum of 39 weeks of unemployment benefits, down from 65 weeks in the 1970s. The average weekly benefit is $293.”

And then there is deflation—imagine if prices and salaries all fall while debts remain unchanged.

The recession is coming closer

Labor market trends as reported by the Wall Street Journal’s Market Watch (November 6, 2008):

  • The number of U.S. residents collecting state unemployment benefits reached the highest level in 25 years, rising by 122,000 to a seasonally adjusted 3.84 million in the week ending Oct. 25.
  • The economy has lost jobs for nine consecutive months. So far in 2008, nonfarm payrolls have fallen by 760,000 to 137.3 million.
  • Real hourly compensation fell 1.9% in the quarter and is down 0.9% in the past year, marking the largest annual decline in 13 years.

Keep checking Recession Watch for the latest.