Lack of Job Creation, Not Layoffs, Driving Unemployment

James Sherk / January 12, 2010

New data released today by the Bureau of Labor Statistics shows why a jobs recovery remains far off. This report, the Job Openings and Labor Turnover Survey (JOLTS), will receive much less press attention than last Friday’s unemployment report. However its figures hold the key to understanding why unemployment has risen so greatly.

Between the collapses of the auto industry in Detroit, the finance industry in New York, and the housing bubble nationwide, media coverage of the recession has focused on layoffs. There is a lot of truth to this. Layoffs have increased significantly since the start of the recession.

But layoffs are not the biggest part of the story of rising unemployment. Today’s figures show that less hiring is the bigger – but largely ignored – force driving up unemployment. (more…)