In this latest video report on making sense of the economy, NewsHour economics correspondent Paul Solman takes a closer look at why unemployment numbers are at a steady high of 10 percent, as seen through the lens of a small business.
Steve Guy, the CEO of Entertainment Design Group in Atlanta has significantly cut his payroll in the last year and is hesitant to begin hiring people again.
"We're sort of just stuck, like a boat stuck on a sand barge. So, for now, there's absolutely no reason to hire anybody full-time, because I don't want to have to hire somebody and just come back and have to let them go again," Guy said.
Solman also talks to analysts who have gathered for the annual economists convention. Despite reports that the recession is over, the job outlook is still grim.
According to some economists, it would take an enormous burst of new jobs in the next few years to get the U.S. back to where it was at the start of the recession.
Quotes
"Big corporations are not building new buildings. Theme parks are not building new rides. And, with that, we're sort of just stuck, like a boat stuck on a sand barge. So, for now, there's absolutely no reason to hire anybody full-time, because I don't want to have to hire somebody and just come back and have to let them go again." - Steve Guy, CEO of Entertainment Design Group
"The underlying growth of jobs in this country looks to me to be very anemic, another kind of jobless recovery, like or worse the ones we had before." - Allen Sinai, Decision Economics
"Who's going to want to expand? Who's going to want to build an office building, when we have got record vacancy rates? Who's going to want to build a factory, when we have got near record excess capacity in industry, and down the line? So, why would you expect hiring in this environment?" - Paul Krugman, New York Times
Warm Up Questions
What is the recession? What happened to the global economy in the last year?
How has unemployment been affected by these developments? Why is it harder for people to get jobs?
Discussion Questions
How was this business affected by the failure of it's business customers?
Why was the owner reluctant to hire a new employee?
What is an increase in productivity?
What example of an increase in productivity did you see in the segment?
How many new jobs did Paul Krugman say had been created since 2000?
What predictions did the economists interviewed have about unemployment levels for the coming months and years?
Why does Steve Guy say he's not going to hire more full-time workers, even if the economy really picks up? Do you think the uncertainty about government policy, like health care reform, is much of a factor for him?
When Guy says "as productive as possible" he's talking about the economic concept of productivity. What is it?
What do we lose when people are out of work?
What does it feel like to be unemployed? Is it bad for you? (See our story on the human cost of layoffs here ).
Who's not counted in the unemployment rate that's reported in the news every month? (See Unemployment data here ).
Additional Resources
