Feb Unemployment Numbers and The Myth of This Being Worse Than The Great Depression

February, 2009: 4.8% Unemployment Rate
Putting The Latest Numbers In Perspective

· The latest unemployment rate for the Tulsa area that I have seen is 4.8%.
· There have been many layoffs in the area.
· Many companies have implemented a freeze on new hires.
· Several direct-hire recruiters I’ve spoken with report a slowdown in job orders.

Does this mean that the sky is falling? Not at all. The unemployment rate of 4.8% means 95.2% of Tulsa’s Workforce has jobs—which is well above the national average.

Despite the recent wave of layoffs, Tulsa is still below the national average for job losses. Often layoffs create opportunities for top performers. During uncertain economic trends, many companies offer early retirements and generous severance packages to employees. This, coupled with other “right-sizing” moves often has unintended consequences—a vacuum is created by the loss of experienced expertise. This results in consolidating those positions into new ones (which must be filled) that are critical to the success of the operation.

When companies implement hiring freezes on new hires, many of their top performers begin discreet job searches; when they accept a new position the company they are leaving often has to fill the existing position that has been vacated.

The slowdown in job orders for direct-hire recruiting firms is not uncommon during economic downturns, as one veteran recruiter put it, “This isn’t my first rodeo—anytime employers hear about layoffs and see an uptick in unsolicited résumé submissions they see a way to avoid paying fees. This usually last about as long as it takes for them to figure out that they don’t have the time (or manpower) to properly vet candidates to weed out the ‘looks good on paper ‘ mediocre job seeker from the displaced top performer.”

Finally, a word about the psychological game that some politicians are playing about the current situation--namely that for several months there has been a concerted effort to convince us that this is the worst economy since the Great Depression. Fact, it isn’t anywhere near that. From 1923-1929 the average unemployment rate was 3.3%. In 1931 it jumped to 15.9%. In 1933 the rate was 24.9%, then dropped to 19.1% in 1938 and 9.9% in 1941. After the United States entered World War II the 1942 rate came in at 4.7%. Move forward thirty years and we discover that the 1975 unemployment rate was 8.5%.

I’m sure most of us have heard that the Chinese symbol for crisis is composed of two symbols, one meaning danger, while the other means opportunity. In putting the current Tulsa area numbers in perspective we must be aware of the danger, but look for the opportunities that are being created. That requires creative thinking but it can pay big dividends for savvy job seekers.