Two graphs compare public and private sector job losses (or adds) for President George W. Bush’s first term (following the “dot-com” stock market bust), and for President Obama’s current term (following the housing bust and financial crisis).
Note: Many differences exist between the two periods. Though both followed the bursting of a bubble (stock and housing), the housing bust also led to a severe financial crisis. As Reinhart and Rogoff document, recoveries from financial crisis are usually extremely sluggish: “The Aftermath of Financial Crises“.
Click on graphs for larger images.
The first graph (above) shows the change in private sector payroll jobs from the beginning of Mr. Bush’s first term compared to Mr. Obama’s current term.
Obama – more recovery over shorter period.
The employment recovery during Mr. Bush’s first term was very sluggish. Notably, private sector employment was down 913,000 jobs at the end of W’s first term.
Recovery during Obama’s presidency has been sluggish, too. We are still down 247,000 private sector jobs from when Mr. Obama’s term started; though, significantly, this situation will likely turn positive in just a couple of months.
Obama will end his first term in office with more private sector jobs existing than when he took the oath. We then have to make up for the jobs lost at the end of W’s term.
A big difference between Mr. Bush’s first term and Mr. Obama’s term has been public sector employment (see second graph, above).
The public sector grew during Mr. Bush’s term (adding 900,000 government jobs), but the public sector has declined dramatically since Obama took office (less 590,000 government workers).
Let me make that clear: the free-marketeer anti-government conservative grew government payrolls dramatically during his first term… while the socialist/”communistic” pro-government liberal saw government payrolls shrink. Hummm…
It appears the public sector job losses are slowing, and it looks likely that the decline in public payrolls will probably end mid-year 2012.
So, if Republicans don’t screw it up, this year should see significant job growth overall, with most of it in private sector jobs and no more losses of public sector jobs.