It's common knowledge by now that the current recession is the worst in terms of percentage of jobs lost since World War II. But how much worse? According to Bill McBride at the blog Calculated Risk, the current recession has both the greatest percentage of jobs lost and the longest duration of those losses. Today he posted a projection of those losses trying to estimate how long it will take until the economy regains only the jobs lost in the recession, not including increases in the workforce over that time. A common rule of thumb is that the economy needs to create 100,000 jobs a month to absorb population growth and new entrants into the workforce, so even when we get back to 2007 job levels we will still have substantial unemployment. The chart with those projections is below:
Measured by area, i.e. the depth of job losses multiplied by length of time required to get back to 2007 job levels the current recession is, by my calculation almost six times worse than any previous post WWII recession, as shown by the chart I've created below:
The two bars furthest to the right represent the area calculated by McBride's two different projections. The first 2007 bar is the area that would be represented if the economy produced 200,000 jobs per month through July 2014. Keep in mind that last month the economy produced only 84,000 new jobs. The bar farthest to the right represents total losses if the economy produced 125,000 new jobs per month through February 2016.
By this measure the total measure of percentage jobs lost multiplied by the time required to gain back those jobs for the 2007 recession is nearly six times greater than the next greatest loss, that of the 2001 recession.
To produce this graph I first took McBride's graph of job losses with projections into Photoshop. I then used clipping paths to to isolate the area contained by each recession's job-loss curve. I exported those plots as jpegs and imported them into a program called ImageJ which I used to measure each recession's area.