Labor Market Realities for Minnesota Veterans

By Rachel Vilsack 
June 2009

PDF of article (3 pages)

The Minnesota men and women serving in the U.S. military overseas will be returning to a labor market that looks far different from the one they left. Over the past year, unemployment rates have risen to levels not seen since the early 1980s. The economy will affect many returning service members. What was the labor market like for soldiers returning from past wars and conflicts and how does the current experience compare?

Figure 1 tracks national monthly nonfarm employment dating back to 1939, along with five significant U.S. military conflicts. During World War II, jobs reached a high of almost 43 million in 1943, a gain of 11.8 million jobs since the war’s beginning in 1939. Monthly job growth during the Korean conflict was the highest of all major wars, averaging 141,200 jobs nationally. In more recent conflicts, employment contracted by 147,400 jobs during the Persian Gulf War. Since October 2001, when the war in Afghanistan started, national employment has grown by an average of 29,300 jobs per month.

Figure 2 charts monthly unemployment rates and 11 post-World War II recessions. Since Vietnam, one or more recessionary periods coincided with each major military conflict, but to date no conflict has ended during an economic recession. The closest the country came to that was the end of the war in Korea. The 10-month 1953-1954 recession was declared the same month that the armistice establishing a demilitarized zone was signed, ending major hostilities in Korea.

More typical, however, were the Vietnam era and Persian Gulf War. The ending of both coincided with the end of a recession, although in 1991 the national unemployment rate continued to rise for several months following the recession’s official end.

It is too early to say whether the current recession will end by the time U.S. combat troops are scheduled to be withdrawn from Iraq in early 2010. (A transitional force of 35,000 to 50,000 advisory personnel will remain in the country through the end of 2011, and at least 17,000 additional troops are being sent to Afghanistan.) The recession will certainly make the transition to civilian employment more difficult for returning veterans. Those who plan to return to their previous employers may find that the businesses no longer exist. Others will encounter the same difficulties finding work that other unemployed civilians are facing.

Younger veterans, in particular, may lack civilian work experience, vocational education or the college degree required for some career fields. The ability to translate their military training, skills and experience into terms recognizable to civilian employers will be essential. Their military backgrounds, combined with educational opportunities when they return, should provide veterans with a new set of skills and experience to enhance their job searches.