Here's the first graph, which he describes as "horrifying."
The lesson is easy to see, but hard to swallow. In the last ten years, the private sector has grown by 1.1 percent. That's down more than twenty-fold from the beginning of this decade. If the number of jobs lost brings the unemployment rate to 10.2 percent (which some fear could happen in the next six months, since employment is a lagging indicator of economic strength), it will bring the ten-year change in private sector jobs into negative territory. The last decade will have, quite literally, been lost to the private sector.Mandel continues to number-crunch and finds that the nitty gritty is even uglier than the big picture. Not only has the private sector basically stalled this decade, but almost all the gains were made in three areas marked by heavy government assistance, such as health and education.
In other words, in the last ten years we've borrowed our way into record deficits and what we have to show for it is an anemic private sector that uses the government as a crutch. 
"uses government as a crutch?" Could it be that government is growing at the expense of the private sector?
Or, perhaps, that near a decade of liberties in tax rebates and economic incentives that disproportianetly benefit the most affluent in society have failed to create an economy for the rest of us.
And, perhaps, that a finance sector that comprises 40% of GDP is horribly inefficient at allocating capital to anyone but themselves.
The other thing these three sectors have in common is it's rare for the deadwood to be fired in any of them. Particularly in the Federal govt and education (but in health care as well) the is no healthy turnover of employees bringing in new ideas and energy. This leads to decreasing productivity and waste.
Brian
The Business Week guy should now do the same type study looking at the growth of public sector employment. Then he could do a study comparing the rate of growth of public sector employee compensation vs. private sector. He could also look at the growth of the "public interest group" private sector employment.
After that, he could study the growth of various gov't. regulations, requirements, etc. largely pushed by liberals: things like environmental regs, product safety regs, OSHA regs, and on and on and on.
Last, he could look at the phenomenal growth of the shyster business; a business that has grown at the expense of other business since "deep pockets" is where the money is.
I have a sneaking suspicion that, after all that, one could come up some possible reasons WHY private sector job creation has stalled.
It strikes me as profoundly unlikely that there have been a net growth of environmental, product safety, OSHA, etc regs. over the past ten years. To look at the housing/banking/energy worlds, the problems have come from under-regulation (or under-enforcement) instead of over-regulation.
I'm also not sure that government growth is at the expense of private growth, since most of government growth has been funded by deficit spending, not taxes.
About three years ago, the WSJ reported that 700k high-tech jobs had been outsourced to India and China. Other studies have reported that more than 2 million US jobs were lost as a result of NAFTA. Beginning with the Clinton administration and still in place today, American companies receive tax incentives for outsourcing jobs abroad. A major US healthcare service provider, Apria, recently decided to turn all of its billing over to a company in India, terminating more than 2,500 US employees. The combination of tax incentives and reduced costs--from about $18/hr/person (combined wages and benefits) to $2.25/hr/person--was too lucrative to ignore.
Given these factors, it seems odd that anyone would express surprise that the nation has seen such poor performance in private-sector employment. Indeed, what should strike us is that so few people during the past decade or two have protested the government's collaboration in eliminating American jobs through its active encouragement of outsourcing.
James,
We're not sure who you are or what you do, but the information you posted about Apria Healthcare's billing operations is incorrect. Apria is not turning over "all of its billing" to a company in India. Rather, we are consolidating certain respiratory/home medical equipment billing functions in three large Customer Care Centers located in Jackson, TN; Overland Park, KS and Tempe, AZ, in addition to a centralized Medicare billing center in Canonsburg, PA. In fact, we are recruiting to fill additional positions in these markets now, and have secured additional real estate in Overland Park to support our strategy. Moreover, the primary driving force behind this decision is the severity of the Medicare payment cuts in 2009 and the prospect of additional cuts to valuable homecare benefits for seniors in the future. Government payment policies for homecare place no value on the service component offered by America's durable medical equipment and oxygen suppliers and the cuts are causing providers to find innovative ways to reduce their labor and other operating costs since these far exceed the cost of the equipment or medications required by the Medicare beneficiaries. While it is true that Apria is outsourcing certain simple billing processes to an Indian company, your statement was overreaching.
Apria Healthcare Corporate Office
Haven't the republicans been in charge for part of the past 10 years? Also havent some lack of regualations been responsible fo rsome events in the recent past? Get a new foil other than liberals.
Maybe the private sector has lost jobs due to lack of imagination and vision in management. It was probably far easier to make things look better in the short term by eliminating payroll. Stock price goes up, someone gets a bonus.
Rather than whining about what Business Week should study as some sort of complaint about government spending crowding out private sector job creation, you could do the research yourself with five minutes at bls.gov.
The answer is that government (fed state and local) have created approximately 1.3 million jobs in ten years, going from 21.6 million in June 2000, 22.6 million in June 2009. Evaluate the data how you like, but it would be difficult to argue the government has put the private sector out of the employment business.
This all highlights how things are spirialing quickly. The governemnt cannot sustain the spending to maintain all of these jobs long term and this is absolute proof that the American business industry is a complete shambles. It seems that we are in for a wild ride.
Private sector job growth being relatively weak should hardly be a surprise, as government grows.
If the government doesn't maintain its increased spending, and general push for jobs in those sectors, but instead leaves more resources in the private sector, than we will get new jobs in different sectors.
So much to put into perspective - so little time.
Although the correlating evidence is worth much to some, I assure you it is not simply Government Jobs VERSUS Private-sector Jobs as many insist.
With the explosive growth of the Wall Street-inspired business acumen in the late 70s came the warcry to treat employees as liabilities to be shed to please the stock analysts not as assets to be retained or retrained. When the private-sector forgets that human work is done by human beings for human beings then the government of the day is left to pick up the pieces and try to salvage some sense of public decency.
Following the latest GFC, I'd safely predict that America's ever-shrinking jobs market will see a bitter end unless the captains of industry wake up and take real stock of what their inhumanity is costing all of us. Does anyone really need $7.9 billion, Mr Murdoch?