Posted by: Josh Lehner | September 9, 2011

Comparing Expansions at the Industry Level

Over at the Federal Reserve Bank of Atlanta’s research blog – macroblog – Dave Altig, SVP and Research Director, has an interesting post regarding industry level employment gains during recent economic expansions. Please do read it to understand the reasoning behind the graphs. Our office has long been a major proponent of bubble charts, see this Sept 2010 employment post as an example, as we provide quarterly updates to Oregon employment in our standard presentation using a bubble chart. The two graphs below provide an Oregon perspective regarding what Mr. Altig is writing about at the national level. Given that his post only pertains to the 2000s expansion and the current one, I thought it may be useful to also include the 1990s expansion here in Oregon.

The first graph illustrates the average monthly gain by industry for both the 1990s expansion (horizontal axis) and the 2000s expansion (vertical axis). What is interesting to note is how close the industries are to the dashed, red line which means that during the 2000s expansions, industries added the same number of jobs per month that they did during 1990s expansion. Both expansions were of the same relative strength in terms of the number of jobs gained; however the length or duration of the expansion is another issue. The 1990s expansion lasted 115 months while the 2000s expansion lasted 55 months (from trough to peak).

The second graph mirrors Mr. Altig’s as it compares the 2000s expansion with the one we are currently in. Notice how the dispersion of the industries away from the red line differs quite a bit from the previous graph.

There’s not necessarily too much to say here, other than the reemphasize the point made in the previous post. Private sector employment, excluding housing related industries, is gaining jobs at approximately the same pace as previous expansions (notice manufacturing, retail, leisure&hospitality, etc are above the red line in the graph above) however the two big drags on economic growth are weighing heavily on this expansion so far.


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