Where We Were Four Years Ago

Blog ››› ››› JEREMY HOLDEN

Are you better off now than you were four years ago?

The quadrennial question is percolating among the chattering classes as attention increasingly turns toward the general election.

And as the right continues its push to obscure the record and deny the fact that the economy has improved, the media are obligated to recall where the economy was.

Four years ago, the front page of The Wall Street Journal announced "AIG posts record loss, as crisis continues taking toll." The article reported that the financial crisis that had already sunk Bear Stearns was spreading out from Wall Street and into the broader economy. Not just profits, but jobs were disappearing at an alarming rate:

The global financial crisis is increasingly claiming jobs as the stock market struggles, financial firms retreat from risky businesses and deal-making remains slow. More than 23,000 financial-related U.S. job cuts were announced last month, according to outplacement firm Challenger, Gray &Christmas Inc. That increased the total to 49,825 in the first four months of this year -- nearly as many job cuts as were announced for all of 2007.

In the U.S., Wall Street's employment losses are concentrated in New York, where one in every five securities-industry jobs is based. Layoffs also are deepening in London, Hong Kong and other financial hubs. Lehman Brothers Holdings Inc., based in New York, is expected to announce next week that it is eliminating about 5% of its employees, or about 1,425 positions, on top of a previously announced 5% cutback in Lehman's work force. A Lehman spokeswoman declined to comment.

By the end of June, Morgan Stanley plans 1,500 more job cuts, falling largely in the U.S. and hitting all businesses except global wealth management. No brokers will lose their jobs, but the latest downsizing puts total layoffs at Morgan Stanley at about 4,500 people, or 10%

In contrast to the hemorrhaging job market that existed in the run up to the 2008 election, employment growth has continued unabated for more than 2 years. Indeed, the Labor Department reported that in March companies posted the highest level of job openings in four years. The number of workers competing for each job opening has reached the lowest level since the recession ended.

Last week, the media failed to examine Mitt Romney's absurd claim that the economy should be creating more than 500,000 jobs per month -- never mind that such a high level of persistent jobs creation is unprecedented.

During an election likely to be centered on economic growth, these failures allow conservatives to set impossible goals while simultaneously obscuring just how far the economy has come since four years ago.

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