Eight Million Jobs Gone — Does the Future Look ‘Green’?

This recession, unlike previous ones, forced a sudden shift in the job market after eight million jobs were lost, many of which will not return. So, what are the growth sectors of the future? Or should we just accept high unemployment rates as the new norm?

In some part and for a while, the answer is yes. The economy is recovering, and while it won’t be “jobless” like the Republicans say, there won’t be a sudden surge in employment and hiring either.

Here’s why

In the past, the construction and automotive industries led the country out of recessions. But this time around the recession, has pretty much eviscerated Detroit— the headquarters of the American automotive industry. In terms of construction, 20 percent of the total U.S. economic output can be directly tied to real estate. But in this economic climate, there is a huge surplus of foreclosed homes and vacant commercial properties hovering over the market. There are also tighter lending guidelines which prevent many Americans, especially minorities, from getting into that market. The sub prime loan market, which accounted for a considerable amount of real estate growth in the last 10 years, no longer exists.

About 20 percent of retail sales, think Home Depot, Lowes and furniture stores, is also directly related to real estate. About 70 percent of the Gross Domestic Product in the U.S. is directly related to consumption (which is depressed due to high unemployment, financial uncertainty, indebtedness and the credit crunch which refers to card companies upping interest rates, and revoking credit cards due to the recession). Consumption accounts for $10 trillion of  our $14 trillion economy.

So, in the short term, joblessness is the norm because this time around, it’s not just about recovery but reinvention.

Economists say policy makers are already reconciling themselves with an economy less dependent on consumption by focusing their efforts on increasing exports which means retraining many of those eight million workers (who lost their jobs) to transition into new job sectors. It will also involve tackling ongoing international trade policies, which negatively impact the ability of American companies to export goods. In other words, it’s going to take time— and lots of it.

“This Great Recession is an inflection point for the economy in many respects. I think the unemployment rate will be permanently higher, or at least higher for the foreseeable future,” said Mark Zandi, chief economist and co-founder of Moody’s Economy.com.

“The collective psyche has changed as a result of what we’ve been through. And we’re going to be different as a result.”

What are the growth sectors?

There will be moderate growth in select industries like technology, advanced manufacturing, health care, government sector jobs, biotechnology, environment and the renewable energy fields. Will those jobs account for even a considerable amount of the eight million that were lost? Absolutely not. Still, investments in those fields are expected to grow about 8.3 percent this year when compared to last year. Intel President and CEO Paul Otellini announced in February that he planned to invest $3.5 billion to support U.S.-based job growth.

The government sector will also see moderate job growth. During the recession, as the private sector lost jobs, the government sector gained 300,000. At present, the government (federal, state and local) employs 22.5 million workers.

Green jobs

The one bright spot in the jobs picture is the development of green jobs. The Chicago-based Challenger, Gray & Christmas predicts growth in environment, ecology and alternative energy sectors and believes it will fuel “fuel significant growth and job creation over the next decade.”

“Green-collar” jobs include engineers, architects, project managers and consultants. Challenger, Gray and Christmas expects that the U.S. will see a growth rate of 1.3 million per year through 2030. They say it could possibly rival the dot-com boom of the late 1990s.

But here’s the catch: That industry, for all practical purposes, is in its infancy. Workers aren’t even trained yet for the sector, so, it’s going to take some time.

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