Although few of us can remember the Great Depression, we have all seen the pictures of despair - the homeless, the soup lines, and the unemployment lines. Certainly, there are similarities between then and now. Since the recession began in December 2007, 7 million jobs have been lost, 5 million people have been unemployed more than six months, and the unemployment rate has almost doubled. Consequently, one has to wonder if we are in a recession or depression.

There is no standard definition of an economic depression. Some economists define a recession as two or more quarters of reduced Gross Domestic Product (GDP) whereas a depression is a decrease of 10% or more in the GDP. Although the GDP has contracted four straight quarters, according to the Bureau of Economic Analysis (BEA), in the first quarter of this year, real GDP decreased 6.4%. Estimates for the second quarter are a decrease of 1 percent. Thus, by some people's standards, we are still in a recession.

In addition to a decrease in the GDP, recessions are marked by rising unemployment. In comparing the Great Depression to today, how does employment differ? At the peak of the depression, unemployment was roughly 25%; as of September 2009, it is 6.8 percent. However, for various reasons, these figures cannot be compared accurately.

When the unemployment compensation program began, the way unemployment rates were calculated was different. To have a better understanding of the unemployment program, the background is important. Unemployment insurance began with the Social Security Act of 1935. Unlike today, in 1935, Social Security covered unemployment insurance as well as retirement benefits. The act created the Federal-State Unemployment Compensation Program. It had a two-fold purpose: to provide temporary and partial wage replacement to involuntarily unemployed workers and to stabilize the economy during economic downturns. To finance the program, states collected a tax from employers. This act imposed a tax on employers with commercial and industrial payrolls with eight or more workers employed 20 or more weeks during a calendar year. The tax was graduated the first two years, and the third year and thereafter, it was a 3% tax on payroll. Because of administrative difficulties, it excluded agricultural labor, maritime service, and domestic service in private homes. .

Before 1940, accurate data on unemployment wasn't available. Therefore, throughout the worse years of the depression, no one knew how many unemployed workers existed. Consequently, the figures are just estimates. Even since the 1940s, the definition of unemployment has changed. For example, to be considered unemployed today, you need to be:

• 16 years of age or older
• Medically able to work
• seeking employment and availabe for work

However, in the past, there were differences. Some differences were:

• Workers as young as 14 were counted as unemployed.
• Unemployed workers not actively seeking employment were counted as unemployed.
• Workers laid-off who would be called back in less the 30 days were not considered unemployed.
• Workers who were to begin a new job within 30 days were not considered unemployed.
• Agricultural workers, maritime workers, private domestic servants, and government workers who lost their jobs were excluded.

Consequently, if you adjusted for these factors, unemployment rates would be different.

According to Wikipedia, if you compared the Great Depression with today, current unemployment numbers would be 5% to 10% higher. If we use these figures with today's unemployment rates, rather than a national unemployment rate of 9.8%, it would range anywhere from 14.8% to 19.8%. Therefore, although our unemployment rate hurts, it is not as painful as back then. Furthermore, prior to 1935, unemployed workers did not have unemployment insurance benefits to act as a safety net.

Although today has been marked by financial hardships we haven't seen since the Great Depression, it is still considered a recession. Even after adjusting unemployment rates for differences between now and then, the unemployment rate now is still lower. More than likely, the unemployment will rate wll still rise. However, opinions vary whether we are on the road to recovery. There have been two positive factors. First, although the first quarter of 2009, the GDP decreased by 6.4%, estimates for the second quarter are 1%. This increase in the GDP from the first quarter to the second quarter could be due to the economic stimulus bill. Secondly, new claims for unemployment have fallen to their lowest levels since the beginning of the year, and the lastest drop was the fourth drop in new claims in five weeks. Considering this, maybe, just maybe, the unemployment crisis will improve, and we won't see rates as high as the Great Depression era. Hopefully, our legislators will be able to come up with some good ideas to stabilize unemployment and avoid a jobless recovery.