NY Times: “Many of the jobs slashed during this recession are not coming back.”

From a January 28, 2010 entry on the Economix blog of the NY Times:

The big ocean of blue represents the portion of the unemployed who have lost their jobs, with the lighter blue section showing those whose jobs are gone permanently.

There are multiple ways to explain why permanent job-losers represent a higher share of the unemployed this time around. Maybe, as others have suggested, many of the jobs gained in the boom years were built on phantom wealth. Or maybe the culprit is a corollary of Moore’s Law, the idea of exponential advances in technology over time. That might suggest that innovation and automation displace more and more workers by the time each recession rolls around.

Whatever the underlying cause, the result is disconcerting: compared with previous recessions, many more of the employment gains in this recovery will have to come from new jobs.

That is much easier said than done.

Workers whose entire occupations — not just the previous payroll positions they held — are disappearing (think: auto workers) will need to start over and find a new career path. But the new skills they will need take a long time to acquire.

What’s more, in addition to obtaining new degrees or training, some workers may need to move to new places in order to start a different career. But sharp declines in housing prices, plus high loan-to-value ratios on many mortgages before the downturn, will make that transition harder. Homeowners who are “underwater” — that is, who owe more in mortgage payments than their house is actually worth — may not be able to sell their house for enough money to enable them to buy a home in a new area.