The housing crisis is now a jobs crisis that’s reaching pretty far back into the history books for an equal. The U.S. Labor Department said Friday morning that nonfarm payroll payrolls plunged 663,000 in March, driving the unemployment rate rose from from 8.1 to 8.5 percent; the only good news, relatively speaking, is that the number of jobs lost was relatively within Wall Street’s expectations. But that doesn’t make the number of jobs lost small. As the Wall Street Journal noted in its coverage of the jobs numbers, the number of jobs lost in the current ‘great recession’ has now topped 5 million since December 2007, with more than 3.3 million of those job losses coming in the past 5 months. January’s job loss total was revised to 741,000, as well, the third highest monthly job loss total in U.S. history — only monthly job losses seen in the 1940s due to a historic coal and steel strike and and the end of World War II were greater. For mortgage servicers, the number to pay attention to is a bit broader, and includes marginally attached and involuntary part-time workers: that number pegs the total of unemployed and underemployed at 15.6 percent in March, up sharply from 14.8 percent in February. Mortgage lenders and servicers care deeply about the broader employment figures because workers moving into part-time employment involuntarily are as much of a credit risk for default as an employee being laid off. The number of workers who want full-time work but can only find part-time jobs rose by 423,000 to 9 million in March, as well. Which means that those economic talking heads pegging a double-digit unemployment rate by the end of this year appear ever-more likely to be correct; and depending on the measure, we may already be there. Commentary by Howard Gold at MarketWatch asks a very pertinent question as the U.S. economy continues to right-size: where will we find new jobs? “I’m more convinced this is not just a deep cyclical recession but a fundamental ‘reset,’ to use a popular word these days,” he wrote Thursday. “U.S. consumers simply can’t resume the debt-induced spending binge that powered the global economy for most of this decade. And the rest of the world, especially China, isn’t ready to take up the slack.” Write to Paul Jackson at firstname.lastname@example.org.
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