Tuesday, May 1, 2012

Business Employment Dynamics: Where Jobs Losses and Gains Come From

Below, Corrections graphically depicts transformed Business Employment Dynamics data.  The two data series are the proportion of gross job losses generated by closing establishments, rather than contracting establishments (click to enlarge).  Similarly for gross job gains generated by opening establishments, rather than expanding establishments.

Three things seem to jump out of the figure:

  • Generally, around 20% of gross job gains and losses come from opening and closing establishments.
  • Compared to the proportion of gross job losses that come from closings, generally a higher proportion of gross job gains come from openings.
  • There has been a secular downward trend in the impact of closings and openings on employment.
The last point is probably bad news for the U.S. economy.

1 comment:

  1. That last point has to reflect at least in part the closing of capital markets to IPOs, the extreme adverse effect of SARBOX costs on newer enterprises of the <$200M range, and the ever rising regulatory burden applied to all businesses but affecting startups where you have to create all the systems.