Posted by: Michael Mandel on May 13
If you’re an engineer, a networking/IT/software worker, or a ‘creative’ type, you have the right to feel terrible. The stretch since Lehman went bankrupt has been absolutely horrible for most professionals (Exceptions: Education and healthcare occupations, and perhaps legal).
I just did some analysis on BLS data, and the results were stunning. Since Lehman went bankrupt, there’s been a complete labor market collapse for many professional occupations. Over the last year, professional employment is down -0.7% (the average of the three months ending April 2009 compared to the average of the three months ending April 2008).
That’s bad enough, but that number is boosted by growing employment in education and healthcare occupations. Other professions are disaster areas. Take a look at the table here.
|BAD NEWS IN PROFESSION-WORLD|
|percent change in employment|
|August ‘08- April ‘09*|
|Computer and mathematical occupations||-9.3%|
|Engineering and architecture occupations||-10.3%|
|Life, physical, and social science occupations||-2.3%|
|Arts, design, entertainment, sports, and media occupations||-11.5%|
|Total employment (not seasonally adjusted)||-4.3%|
|Total employment (seasonally adjusted)||-3.0%|
|*Three month moving average. Not seasonally adjusted unless|
|Data: BLS||Calculations: Mandel, BW|
Yikes! These numbers are scary. A 10% decline in engineering occupations in just 8 months? A 9% decline in computer and mathematical employment? An almost 12% decline in “creative” occupations, such as designers and the like?
I’ve got charts down below the fold which are even scarier.
But first, let me tell you what’s in each of these groups. The ‘computer and mathematical occupations’ are mainly software engineers, computer scientists and systems analysts, with some network analysts and the like thrown in. ‘Engineering and architecture occupations’ (actually the BLS reverses the order) is roughly 67% engineers, about 10% architects, surveyors and the like, with the remainder engineering and mapping technicians. ‘Life, physical, and social science occupations” includes natural (and unnatural!) scientists, psychologists, economists, market and survey researchers, urban planners, and a variety of scientific technicians. And last but not least, the arts or “creative” category, as I call it, includes designers, actors, artists, athletes, dancers, musicians, reporters, editors, writers, photographers, and everyone else that goes along with that. (If you want to see a full list for 2008, go to here).
What unites all of these groups is that they are all producers of “intangible investments.” That is, engineers, scientists, computer software engineers, artists, designers, and so forth all create long-lived intellectual property which has the potential to contribute to the economy. This includes new software programs, new products, new pieces of art and so forth. Writers produce written works of various degrees of usefulness, but in the aggregate are beneficial.
With the exception of software, the government statistics for GDP pick up very little of these intangible investments. That is, they pick up the part of spending which supports current consumption, but not the part which benefits the future.
Okay, here are the charts you’ve been waiting for. They are based on three month moving averages, because the monthly numbers jump around too much.
These charts appear to show that the plunge in employment has levelled off, but I'd like to see at least another month or two before I conclude that.
Michael Mandel, BW's award-winning chief economist, provides his unique perspective on the hot economic issues of the day. From globalization to the future of work to the ups and downs of the financial markets, Mandel-named 2006 economic journalist of the year by the World Leadership Forum-offers cutting edge analysis and commentary.