The Recession's Effect on Hospital Registered Nurse Employment Growth

Peter I. Buerhaus PhD, RN, FAAN; David I. Auerbach PhD, MS

Disclosures

Nurs Econ. 2011;29(4):163-167. 

In This Article

The Great Recession

Since George Washington became the nation's first President, the United States has experienced 46 economic downturns. Thus, recessions (and their opposite, expansions) are a normal part of the ebb and flow of the nation's economy, which over time has a tendency to work itself toward full employment. More recently, since World War II, the economy has experienced 11 recessions with an average duration of 10.4 months.

The most recent recession ranks among one of the nation's most severe economic downturns. Figure 1 shows monthly unemployment rates and the number of people estimated to have lost their jobs from the beginning of the recession in December 2007 through December 2010 (U.S. Department of Labor, Bureau of Labor Statistics, 2011). Although economic growth contracted steadily over the first 9 months of 2008, the economy declined sharply in September. More than 475,000 people lost their jobs during each of the next 4 months for a total loss of 1.9 million jobs during the last quarter of 2008. The national average unemployment rate climbed to 7.3% by the end of the year (U.S. Department of Labor, Bureau of Labor Statistics, 2011).

Figure 1.

Monthly Unemployment Rates and Number of Jobs Lost, December 2007 - December 2010
SOURCE: U.S. Department of Labor, Bureau of Labor Statistics (2011).

During the first half of 2009, both the number of jobs lost and monthly national unemployment rates increased before slowing. Finally, after lasting 18 months, the recession was declared over in June 2009, even though monthly unemployment rates exceeded 9% at the time and continued to rise through the remainder of the year, reaching a peak of 10.1% in October 2009. During 2010, monthly unemployment rates remained above 9.5%, but the total number of unemployed no longer continued to increase each month. By the end of the decade, overall unemployment remained above 9% (U.S. Department of Labor, Bureau of Labor Statistics, 2011) (see Figure 1).

The extended length of the recession and large number of jobs lost suggest considerable time will be needed before the economy can grow fast enough to regain all the jobs lost to the recession. Table 1 shows the number of months each of the last four recessions persisted, the number of jobs lost during each recession, and the number of months it took before lost jobs were regained. Compared to most of the previous recessions since the 1970s, the most recent recession lasted twice as long and shed almost four times the number of jobs. The length of time required to regain lost jobs has also increased. For example, the relatively brief, but sharp recession in 2001, resulted in the loss of 2.68 million jobs and took nearly 4 years before these lost jobs were regained. At the time of this writing, an estimated 8.4 million jobs have been lost since the beginning of the most recent recession, economic growth remains sluggish, and the unemployment rate is 9.2%. Thus, it will likely take several years before all of these lost jobs are regained and the national unemployment rate decreases to pre-recession levels (below 5%).

A prolonged period of high unemployment is likely to depress consumers' confidence and their willingness to spend (preferring to save instead). Restrained consumer spending slows the demand for consumer goods and services which, in turn, causes producers to scale back their operations and hire fewer workers. Prolonged high unemployment rates also signal that more and more people may be unable to pay home mortgages and avoid foreclosure, thereby prolonging the depressed rate of growth in the housing sector of the economy which is key to new job growth. Under such conditions, those who have jobs are likely to be highly motivated to hold onto them, including nurses.

Comments

3090D553-9492-4563-8681-AD288FA52ACE
Comments on Medscape are moderated and should be professional in tone and on topic. You must declare any conflicts of interest related to your comments and responses. Please see our Commenting Guide for further information. We reserve the right to remove posts at our sole discretion.
Post as:

processing....