Past Reality — The Historical Impact of Recession on Our Workforce


Despite what nostalgia tells us, the post-World War II era did not begin with a chicken in every pot and a car in everyone’s garage. In fact, there are many similarities to what happened to the workforce in the late 1940’s to what we are facing right now in Michigan. The history of recessions in the United States shows that these downturns are a natural, though painful, part of the business cycle.

Back in 1949, my father was graduating from college with a bachelor’s degree in engineering. Along side of him, were thousands of G.I.s who had gone back to school under a government-backed education program (the G.I. Bill). Colleges and universities had to rapidly expand to address the educational needs of these returning soldiers who were anxious to be retrained for a civilian workforce.

Now, after four years, these thousands of skilled and highly-trained workers were ready to enter the workforce. Unfortunately, the workforce was not yet ready for them. An 11-month recession began in November 1948 and lasted until October 1949, when unemployment reached a peak of 7.9 percent. GDP fell .5 percent for the year. It was stated that this was another natural down cycle, caused by the economy adjusting to peace-time production.

In the post World War II era, my dad could not find a job — any job — for almost a year after he graduated from college.

Does all this sound familiar?

In 2010, we have a highly-skilled displaced workforce that requires rapid retraining. We recognize that the industries in which these people will work are in the process of reorganization, restructuring, or just beginning to ramp up as new ventures in emerging business sectors.

Like 1949, we are now in a lull, where industrial development needs to accelerate to meet the employment demands of the emerging workforce. The deep recession has slowed this process down and made things tough for everyone.

The best news is that this is all part of the natural ebb and flow of our economy. If we choose to look back at history, we will find that things really started to look up for America after 1949, four years AFTER the war ended. The resulting recovery ushered in one of the most productive and profitable eras in our national workforce.

Let’s hope these are all signs of better things ahead and that history will repeat itself.