The Stash

This Recession, It's Good To Work With The Dead

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Percentage-wise, the manufacturing and construction sectors have taken the biggest hits this recession, -14% and -13% respectively. But in terms of total losses, the service sector -- which has shrunk 4% since the end of 2007 -- leads the way: 4.7 million service jobs have been lost compared with 0.9 million for construction and 1.9 million for manufacturing.

And as per the latest ISM non-manufacturing survey, the services sector is having a tougher time recovering than the manufacturing sector. This shouldn't be too surprising since hiring for service jobs typically lags the business cycle a bit. (Part of the explanation for a slower recovery for services is that the ISM survey includes construction as part of the non-manufacturing survey.)

Still, given the magnitude of job losses in the service sector, I thought it would be interesting to see which positions were shedding and adding the most jobs.

The first chart below shows the 10 worst service sectors as defined by the BLS. The further to the left the bubble is, the more raw jobs the sector has lost and the further down the bubble the bigger the percentage loss since December 2007 through the latest available data (which is through June, except for employment services and temp help, which run through July).

The size of each bubble shows the relative size of each sector. For reference, employment services currently has 2.5 million jobs while tax prep has 49,000 jobs -- which is an astonishing 63% decline. There were three service sectors which far and away had either lost the most raw jobs or had a big percentage drop (tax prep, employment services and temp help), so the second chart zooms in on the cluster in the upper-right of the first chart.

Again for reference, the photofinishing sector had about 16,000 jobs at the end of June while sales financing had 86,000.

 

Nothing too surprising here as pretty much all of these sectors are either related to declining industries (autos and paper mail, print photography), industries caught up in the subprime debacle (real estate, tax prep and finance), or industries you'd expect to be contracting during a recession (temp help and employment services).

This next chart shows the biggest gainers since December 2007. For reference, landscaping had 716,000 jobs through June while cemeteries had 35,000.

I used seasonally unadjusted data, which may explain why landscaping and building services are showing up here. More surprising are the payroll additions in nail salons, death care and cemetries and crematories.The latter two could be related to our aging population. As for nail salons, has it finally achieved consumer staple status?

--Zubin Jelveh

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