Home > economics > More chart porn: Service employment falls two years running

More chart porn: Service employment falls two years running

In 70 years of record keeping, the American economy has never recorded a back-to-back, year-over-year, decline in employment in the services sector of the economy.

Since this is so unprecedented in the economy, we thought we might take a snapshot of this elusive bird so everyone could stare at it with the awe we felt when we first gazed upon it.

Service sector employment in the United States, 1979-2009

Allow us to explain the chart: The green field shows total employment in service sector, which includes government employment, since 1979. The red line shows the change in the rate of employment growth during that period – from a high of 4.5 percent in 1984 to the present low of -2.4 percent in 2009. The black line shows the overall trend in this growth rate from 1979 to the present.

As you can see, during the period from 1979 to 2009, the rate of growth is trending down and finally has gone negative two years in a row during this recession.

What makes it so interesting is that exactly 30 years ago (June, 1979) the United States recorded its largest industrial labor force (19.5 million) only to see it promptly kneecapped by the double recessions of 1979 and 1981. From there, the labor force in manufacturing fell to its present low of 11.6 million workers – and a shitload of Walmarts stocked with inexpensive Chinese made goods.

As industrial employment fell due to increases in productivity and the off-shoring of manufacturing, service sector employment became the one sector where overall employment was growing. Agriculture employment was dead, industrial employment was a dead end, work that produced real economic value was becoming increasingly scarce.

And that is a real problem, since you having a job is the essential precondition for buying all those 42 inch wide-screen high-definition plasma televisions now being made with fewer workers. If you don’t have a job, production comes to a standstill – it is as simple as that.

The great thing about service sector employment is that it provides the wages necessary for you to buy all those otherwise unsellable 42 inch wide-screen high-definition plasma televisions, with out adding to the pile of unsold appliances – it supports mindless consumption without producing anything of real value. And, this becomes ever more important as the increase in productivity forces industry to turn out ever larger quantities of unsellable goods with fewer workers.

For service sector employment to be falling at this time, as the nation experiences the worst economic catastrophe since the Great Depression is, therefore, not only a significant event, it is a dire warning of a serious adjustment in the economy: US service sector employment, which has served as the primary customer for global production, is faltering and an economic train wreck is unfolding in slow motion as those unsold goods begin piling into each other like so many freight cars.

With this data it becomes clearer why many US industrial corporations have begun to shift the emphasis of their operations to foreign market, not just as suppliers of goods, but as customers for these products.

They can no longer count on probability that you will have a job.

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