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Job cuts may continue into 2010
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Cyndia Zwahlen of Los Angeles Times writes in one of her articles, published on February 09,
2009, that shedding of employees would continue to happen in 2010. She is considering bigger
and mid-sized firms for having bigger effects of recession. Smaller organization in California
will continue to run normally even when they are not profiting that much and having a downfall
in cutting down the jobs too. She is quoting many advisers and economists in her article that
besides losing 1 million jobs, there are more to go in upcoming year. After that some statistics
has been told, 175,000 jobs rack-up occurred in January i.e. 0.4% from the previous readings in
the small-business employment. Out of 50.9 billion, nearly 1 million or we can say 2% jobs were
knocked off in February, 2008. This is not it and probably a year is left to get out of this
recession situation. She quotes Joel Prakken, chairman of Macroeconmic Advisors that a
stimulus package offered by the govt. are also going to remain astray because the unemployment
is caused by one of the core causes of recession i.e. loss is gross domestic product. The gross
domestic product is calculated every three months, i.e. a quarter. In the coming year there are
chances of improvement in GDP rate in the second or third quarter. When the recession situation
will be getting better, small organizations will recover on the first place as compared to the
others. The figures of mid-sized organizations calculate cut-down of 255,000 out of 44 million
employees in January, then 92,000, and finally they shed 92,000 jobs.
Cyndia also discusses that small organization got merged with some of those businesses which
used to be paid by government of their state. This helped California’s economy big time from
being crashed completely. She quotes the state controller of California John Chiang who
declared the reimbursement to small companies. State rules indicated that small businesses with
revenues less than 12 millions are amount the not-to-be-paids, where man-power is 100 or few
more. Small businesses owed one-third of the estimated figure. Although some special funds
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would be made that will lend loans from Department of Finance. The state laws are being
followed that the late reimbursement of businesses will pose a penalty interest from about
5.325%. The state is trying to apply for taking a loan up to $2 billion from 19 different states so
as to remove the penalty. The usual warning of 30 days for posing a penalty has been increased
to 45 days by the controller’s office.
This is the high time to take some steps to get over with what we are suffering from, an
economic recession, which is spoiling the economy highly. Some of the causes were obvious in
Cyndia’s article that the root includes the misbalance in maintaining the money supply, forfeiting
of the interests, and price raises at the same time. Cyndia tried to show that this could be dealt by
supplying good amount of money in market, but when the world is wholly being anguished by
the situation, who would provide the capital? This was the reason California was borrowing a big
amount of money but from 19 different states. The main cause was the continued decrease in
gross domestic product growth. People tried to avoid this by chopping down their extra
expenditures which gives an open way to inflation, low standard of living, and unemployment.
The economic scenario can identify the upcoming hazards in a number of quarters
The issue of unemployment has become the core issue in today’s world, because economy is
dependent on it. Another article supports Cyndia’s thoughts that in the past few months we have
lost for about 17,000 jobs. John McCain said, “We are in a difficult time. And we’ve got to act,
and we have to do things in order to restore our economy and provide people with jobs and some
optimism and hope” (LosAngeles Times 2008). V. Dion Haynes is holding up Cyndia’s article
and tells about the unemployment rate that America is a place for job opportunities, and her
metropolitan cities have lost those opportunities now. He also expects this loss rate to be
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increases in the coming time, even more than the one observed in 2001. But he also expects from
Obama government that is predicting the upcoming unemployment problems and economic
stimulus. He is looking forward to their anticipation to do some good for the unemployment
problem in USA. In Washington too, there has been a great loss of jobs in every field like
construction, retail, finance, information technology. Like Cyndia he also sees the crisis in the
early 2009. Some strategy needs to be decided through which people can get their field’s job
otherwise the unemployment rate will rise up to heights (Haynes 2009). An article by Fred
Gaboury affirms that unemployment is huge in surroundings therefore there should be
compensations for the unemployed so that they can step ahead in life, he rejects the Bush’s claim
about 9/11 incident to be the reason for economy downfall, rather he says that his tax cut ate up
all the surplus which resulted in several job-sheds (Gaboury 2002).
Economists have provided many policies for the cure and causes of unemployment. It is an
indication of an unhealthy society which has its potential workers unemployed. These potential
workers may be clerks, inventory managers, or some well-educated individuals. We should also
examine the incentives for what the employers are seeking their employees, and also what
individuals are expecting from employers. Sometimes these small factors become the reason for
not being selected (Block 1981).
In Cyndia Zwahlen’s article there have been predictions about how long this unemployment
issue will continue. Dr. Thomas A. Mroz discusses the effects of unemployment on the youth.
This is the fact that young people are the most energetic individuals in getting trained for a job,
yet they are the ones who have got the highest rate for being unemployed. A young individual
can suffer a lot if he does not get recruited somewhere, this would probably effect his future
immensely. The perpetrators behind this include taxes, monetary policies and other different
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expenditures. If a person loses his job, he would be offered less incentives. Obviously a person is
not gaining any experience which would lead to his future unemployment. The reason is that in
the recession calamity if a firm hardly needs any contender to join them, there is a long list of
experience requirements to get the job. Sometimes the youngsters try to replace the post of
experienced people as they don’t know that experienced individuals are an asset to the
organization. Therefore, not only organizations should acquire fresh graduates but also the
youngsters should go where they can be fit in (Mroz and Savage 2001).
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Block, F. E. Unemployment: Causes and Cures. October 10, 1981.
http://www.cato.org/pubs/pas/pa004.html (accessed February 20, 2009).
Gaboury, F. Umployment Crisis Demands Action Now. January 11, 2002. http://www.cpusa.org/
article/view/331/ (accessed February 20, 2009).
Haynes, V. D. Unemployment In D.C. Region Highest Since '03. January 07, 2009.
(accessed February 20, 2009).
LosAngeles Times. January job losses stir fears of a recession. February 02, 2008.
http://articles.latimes.com/2008/feb/02/nation/na-jobs2 (accessed February 20, 2009).
Mroz, T. A., and T. H. Savage. The Long-Term Effects of Youth Unemployment. Chapel Hill:
Department of Economics, The University of North Carolina, 2001.
Recession.org. What is Recession? Economic Recession Definition. 2009.
http://recession.org/definition (accessed February 20, 2009).