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Comparing Two Recessions

Summary:
Job losses during the Great Recession of 2008-2009 were largely permanent job losses. Job losses during the Great Shutdown of 2020 are largely temporary layoffs. The future course of the economy will, of course, depend on the microbiology. But the economy seems well situated for a rapid recovery if testing, treatment, and vaccine development allows it. (Click on image to enlarge.)An important caveat: The labor force participation rate has experienced a large drop. Perhaps there are many permanent job losers who are classified as not in the labor force because they cannot search during the pandemic.

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Job losses during the Great Recession of 2008-2009 were largely permanent job losses. Job losses during the Great Shutdown of 2020 are largely temporary layoffs. The future course of the economy will, of course, depend on the microbiology. But the economy seems well situated for a rapid recovery if testing, treatment, and vaccine development allows it. (Click on image to enlarge.)

An important caveat: The labor force participation rate has experienced a large drop. Perhaps there are many permanent job losers who are classified as not in the labor force because they cannot search during the pandemic.


Comparing Two Recessions

Greg Mankiw
I am the Robert M. Beren Professor of Economics at Harvard University, where I teach introductory economics (ec 10). I use this blog to keep in touch with my current and former students. Teachers and students at other schools, as well as others interested in economic issues, are welcome to use this resource.

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