Employment Recessions Are Getting Progressively Harder And Harder To Climb Out Of

I suppose a simplistic model of an economic recession would feature an abrupt collapse, followed by a very rapid recovery, as economic assets are instantaneously reshuffled for maximum utility.

In the real world, however, economic assets are not reshuffled so fast. There is always hysteresis and delay built into the system. There are any number of circuit breakers built into the system to slow the process down in order to minimize disruption: legislative remedies, tariffs, tax benefits, government subsidies, loan guarantees, bailouts, unemployment insurance, etc. There's a price, of course: the more circuit breakers you have, the slower the recovery. We keep adding new circuit breakers all the time, in order to partially-escape from the brutal business cycle. Everyone hates the creative chaos of capitalism, and capitalists hate the chaos most of all.

The fact that recovery keeps getting longer and longer is partly the price we pay for minimizing the chaos. The most recent recession, starting in 2008, could have been far worse than the collapse of 1929, had it not been for circuit breakers like TARP.

But part of the process too is technological change. Economies progress and advance and become more efficient, and thus need fewer people to make them function. In the 20th-Century, some fields, like agriculture, have lost virtually their entire work forces. Technological change, particularly regarding assembly-line automation, was a big contributor to the Great Depression, and work-saving innovations from the Internet are a big contributor to our problems today.