In January, 243,000 new private-sector jobs were created, bringing the unemployment rate to 8.3 percent. While these numbers aren’t exactly cause to pop the champagne corks just yet, they do offer evidence that the worst of the recession may be behind us, and better times may lie ahead.
People returning to the workforce are unlikely to see the same job market that they knew before the recession. Some industries were hit harder than others, and while some jobs will make a return engagement in the want ads, some of the lost jobs may never come back.
It’s impossible to say what a fully recovered U.S. economy will look like, or how long it will take to get there. However, some sectors have begun to hire again. Click ahead to see which industries are showing signs of bouncing back.
By Daniel Bukszpan
Posted 06 February 2012
The hospitality sector was hit hard by the economic downturn. In tough times, belts tighten, and the first thing on most families’ chopping block is anything that requires disposable income. An upturn in this sector could be a sign that the economy is turning around.
"The conventional wisdom suggests that key fundamentals should be on the wane, but that has not happened yet and, due to many factors, we don't believe it will occur in 2012," said Michael Fishbin, leader of Ernst & Young's global hospitality services. He attributes this to the rate of new U.S. hotel construction, which has been less than half of its historical average in recent years.
“Hotel supply is not going to outpace demand any time soon, giving fundamentals such as room rates and overall occupancy a chance to further recover," he said.
In 2011, the value of mineral production in the U.S. increased by 12 percent, according to the U.S. Geological Survey. While the agency said that metals accounted for the majority of this increase, the nonmetallic minerals sectors increased by three percent.
It was the first increase for this sector since 2007. Some $74 billion worth of nonfuel minerals was mined in the U.S., while metallic and mineral materials that were recycled domestically contributed $32 billion to the economy.
According to a survey by the American Institute of Architects, a 6.4 percent spending increase on construction is projected for 2013. This is expected, at least in part, because of increased construction spending on commercial properties, hotels and industrial plants.
Corporate profits have returned to their prerecession levels, which means that construction projects put on hold during the recession have begun to be green-lighted again. A 2.1 percent increase in spending on nonresidential construction was forecast by the American Institute of Architects as a result.
When the recession struck, the automotive sector was hit hard, and opinion was divided on whether or not to bail out ailing companies like Chrysler and General Motors. The companies were rescued, but they were restructured in exchange, to the understandable skepticism of many. However, by 2011, both companies were back on their feet.
General Motors’ sales had increased 13 percent, led by such products as the Chevrolet Cruze, the Silverado and the GMC Sierra. Meanwhile, Chrysler’s sales increased by 26 percent. President Barack Obama, speaking from the Washington Auto Show in February 2011, hailed the bailout as a success. “We are now back in a place where we can compete with any car company in the world.”
Intangible goods like transportation and entertainment are products of the service sector. In this sector, it’s not about creating a physical product, it’s about personal interaction. The sector has been slow to recover from the effects of the recession, but that seems to finally be changing.
Economists are tracking job growth that’s been missing for some time. “We are seeing growth in service sector jobs and that looks good,” said former White House chief economist Ed Lazear. “This pickup in job growth may actually be authentic,” said Robert Brusca, chief economist for FAO Economics. ”The kind of growth we’re now getting in this sector is relatively strong compared to the numbers we’ve seen since 2000.”
Housing was hit especially hard by the recession. While nobody would say that the sector is now experiencing another boom time, recent data suggest that the worst may be over, and the sector has begun to stabilize.
“While we still have a long way to go back to normal, the latest numbers are one more indication that housing is slowly turning the corner,” said Bob Nielsen, chairman of the National Association of Home Builders. David Crowe, the association’s chief economist: “We anticipate continued, slow improvement in housing starts and sales through 2012.”
In December, the general economic index of the Federal Bank of Philadelphia increased to 7.3, its highest point in three months. This index measures activity in the region that includes Delaware, southern New Jersey and eastern Pennsylvania, an area that was badly affected when the manufacturing sector was hit in the recession.
The data provided by the general economic index indicate that the manufacturing industry has begun to hire again. However, the new hiring isn’t limited just to this region. For example, the Illinois-based unit of industrial connector manufacturers Harting Deutschland GmbH said it was likely to hire 20 workers in 2012 after doubling the workforce to 120 since the recession.
“We have a couple of large orders that we’re negotiating on in the broadcast and medical industries,” CEO Rolf Meyer said. “These will likely hit in the next five or six months.”
The health care sector was not hit as hard as others during the recession. Today, it continues to do well, and the jobs that were lost are coming back faster than those in many other sectors.
Many people in the nursing program at Research Medical Center in Kansas City, Mo., had been laid off by Sprint and wanted to transition into something stable, according to The Kansas City Star. "Health care is going to be around,” said Jennifer Gnefkow, who graduated from the program. “You'll always have a job."
The technology sector is poised to grow in 2012 and beyond, thanks to the growth of cloud computing. This is the finding of a study from the London School of Economics and Political Science that was underwritten by Microsoft.
The study assessed the impact of cloud computing on the aerospace and smartphone industries in the U.S., Britain, Germany and Italy from 2010 to 2014. Investment in this technology is fueling employment in both industries, and is expected to create more jobs when cloud facilities are built and staffed.
The study also predicts that new jobs will be created for the technology itself. “As firms shift from proprietary application servers towards virtualization and cloud computing, related skills will be in demand among employers,” the study says. “New direct hires and upskilling for public cloud enablement result in higher-than-average salaries.”
According to the International Franchise Association, franchise businesses should begin to recover in 2012, after three years of growth that had been muted by the recession. This conclusion is based on the findings of a report from IHS Global Insight, an economic analysis and global information company.
The tough economy has been a drag on the franchising sector. Low consumer spending and tightened credit standards have slowed the expansion of existing franchise businesses and the formation of new ones. The study says improving conditions should cause the number of franchise businesses to grow during 2012.