467,000 more jobs lost in June.

[NJ5]

Avinash_Tyagi said:

NJ5 said:

Avinash_Tyagi said:
Employment is one of the lagging indicators of a downturn because companies don't start hiring until they see things start to turn around

Your last statement is true, but it doesn't mean employment is a strictly lagging indicator. In a consumer-led recession, the turn around can't start before unemployment starts letting up. Simple logic there I think.

I really want to know how this recession can end while people are losing their jobs and lowering consumption, with their homes getting foreclosed pushing them even farther into poverty.

IMO there's just one way for the recession to end, and that's for more people and companies to get out of debt (either by paying their debt or defaulting on it, the latter of which will cause the banks and the government to lose a lot money due to bailouts).

 

Well a recssion as termed by NBER involves many factors, not just employment:

"a significant decline in [the] economic activity spread across the country, lasting more than a few months, normally visible in real GDP growth, real personal income, employment (non-farm payrolls), industrial production, and wholesale-retail sales."

So it could end even if people are losing their jobs still.

I agree, but with unemployment so high that has to have an impact on future consumption, wouldn't you agree?

We have literally millions of people going out of work, losing their homes (or having cheaper homes), paying higher interest rates on mortgages and credit cards. Unemployment further pushes this vicious circle, resulting in low sales for retail, manufacturers, who then have to lay off more people...

With consumers accounting for 70% of the US economy I would be very surprised if the recession could end when consumers are constantly getting poorer.