Expect very slow recovery of jobs lost

I just found a graph that I think is telling about the depth and unique nature of our current economic predicament. This is as of April 2010, and it assumes that the depth of unemployment was reached then. We now know that to be false, so the situation is actually quite a bit worse than the already dismal picture presented here.

Click here for full size image

The first thing to notice is the severe depth of this recession.

The second thing, the one germane to the theme of this blog, is the shapes of the curves. Notice that the longer-ago the recession, the more sharp the losses and rebounds. The more recent recessions, in contrast, have long, deep troughs. I suspect that the slower rebounds of recent years are due to lack of easily exploitable resources. If there are virgin forests and gushing oil fields for the taking, jobs will be quick to be reborn. The less that is true, the more difficult it is to regenerate jobs.

Notice the long arcs of recovery of the '01, '90, and '81 recessions. We can now tack 17 more months onto the red curve at deep unemployment, and if we use the shape of the three most recent recessions' curves to extrapolate our current recession, we may well be looking at a decade-plus of dire unemployment.