Only one short year ago, the world was staring depression in the face. Now the economy is recovering, but many commentators are warning of a “jobless recovery” of the kind that followed the last two recessions, in 1990-91 and 2001.

Most recently, on January 3 at the American Economic Association annual meeting, Don Kohn, US Federal Reserve vice-chairman, warned that employment growth in 2010 would most likely be slow. Thus the conventional wisdom now has it that the message embedded in Friday's December US jobs report – a seeming end to firing but little evidence of net new hiring – will turn out to be a precursor to similar news on jobs that will dominate throughout 2010.

We believe that these meagre expectations will turn out to be wrong, in large part because they mischaracterise how employment has swooned over the past two years.