Archive for category Unemployment
What’s wrong with the American economy? If you ask presidential candidate John Ellis (“Jeb”) Bush, it has nothing to do with the Great Recession of 2008 during the most recent Bush administration — which put 8.7 million of us out of work. Nothing to do with Tea-GOP economic sabotage during the long, slow recovery that replaced many middle-class jobs with low-wage and part-time employment.
Our friend “Jeb! 2016” says all that’s needed to fix the economy is for more people to work longer hours. Apparently he is not aware that productivity and worker compensation have been decoupled for about 40 years now. Working harder gets us nowhere, and makes CEOs and the 1 Percent richer.
The relationship between American workers’ industriousness and their economic security has eroded so severely in recent decades that the two concepts aren’t even on speaking terms these days.
Workers were a staggering 25 percent more productive in 2012 than they were in 2000. But over the same period that bosses started getting a full quarter more work out of their employees, the median wage grew exactly zero percent. Even those with college degrees saw their pay stagnate over the past decade. Over the five-year stretch encompassing the Great Recession and the first few years of the slow recovery Bush is criticizing, workers gave their bosses an 8 percent jump in productivity – and got back an outright decline in earnings.
Tea-GOP prescriptions like “work harder for less pay” don’t deserve to win any votes. Americans who work for a living are not at fault. We’re the victims of a financialized, de-unionized, 1 Percent economy that’s reaching Gilded Age levels of wealth inequality.
Newsweek: Does Jeb Bush understand economics?
Bush’s full statement was: “My aspiration for the country and I believe we can achieve it, is 4% growth as far as the eye can see. Which means we have to be a lot more productive, workforce participation has to rise from its all-time modern lows. It means that people need to work longer hours and, through their productivity, gain more income for their families.”
This word salad mixes together different economic terms as if they mean the same thing and reaches for statistics that are, quite simply, ridiculous. Perhaps Bush was just sloppy in his language, but whatever aide is prepping him on economics needs to do a better job–maybe by working longer hours.
…When it comes to productivity, American workers have been doing a great job. Productivity, which is the economic output per worker, has grown relentlessly since 1947 in almost a straight upward line. Implying that Americans aren’t being productive enough is about the same as saying McDonald’s doesn’t sell enough hamburgers. How much is enough to Bush? If record productivity–with a cumulative growth of almost 300% since 1947–doesn’t cut it, what does?
There is no context where “we have to be more productive” means anything other than “push yourselves past record levels, workers!” That is, unless Bush doesn’t know what the word means.
But with this full statement, he has also demonstrated that he has no idea of the real problem facing American workers. No doubt, he is blaming them for their stagnant wages–all that’s needed is more hours of work, and wages will improve significantly.
As history proves, that’s hokum. America went through nearly a century where the profits generated by growth in worker productivity was shared–the more they produced, the more money everyone made. What Bush and far too many Republicans refuse to acknowledge is that wages and productivity became uncoupled around 1973: Productivity goes up, corporate profits go up, the rich get wealthier, but the financial benefits don’t trickle down to workers.
…American history’s most productive workers are not responsible for the fact that they aren’t paid enough. Do Bush and his GOP cohorts really believe that the wealthy are sitting in their offices, twiddling their thumbs, waiting for workers to demand more money that will then be handed over gladly? Wages are growing at their lowest level since World War II. In fact, income inequality is worse today than it was in 1774, even when slavery is included in the numbers, according to a study by the National Bureau of Economic Research.
“White House Down” (2013)
Via Think Progress.
Remember all those Tea-GOP predictions about what 2015 would be like if President Obama’s doomed Marxist regime was allowed keep running the country into the ground?
- Newt Gingrich, running for the GOP nomination in 2012, predicted that if Obama was re-elected gas would be “$10 a gallon.” Gingrich promised $2.50 gas if he was elected.
- In September 2012, Mitt Romney predicted that if Obama was re-elected “you’re going to see chronic high unemployment continue four years or longer.” At the time, the unemployment rate was 8.1%. Romney pledged that, if elected, he could bring the unemployment rate down to 6% by January 2017.
- On Bloomberg TV, Marc Faber predicted that, because of Obama’s reelection, the stock market would drop at least 20%. Faber joked that investors seeking to protect their assets should “buy themselves a machine gun.”
- Rush Limbaugh predicted that “the country’s economy is going to collapse if Obama is re-elected.” Limbaugh was confident in his prediction: “There’s no if about this. And it’s gonna be ugly. It’s gonna be gut wrenching, but it will happen.”
Today, the nationwide average for a gallon of gas is $2.24. The unemployment rate currently stands at 5.8% and has been under 6% since September 2014. The Dow Jones Industrial Average currently stands at 17,823 and is up over 35% since Obama was reelected. The Dow has climbed more than 10,000 points during the Obama administration. The U.S. economy grew at a robust 5% in the 3rd quarter of 2014, following 4.6% growth in the second quarter.
Why couldn’t the Tea-GOP predict declining wages? People who work for a living need a raise, badly.
Annie Lowrey, New York magazine:
Labor-force participation has declined — partially because the baby boomers are retiring, but also because prime-age workers are fleeing the job market. Churn has remained slow, with workers too timid to quit their jobs. The middle class is poorer than it was when the recession started, poorer than it was when the recession ended, and poorer than it was in 1989. In real terms, wages are stagnant even though the jobless rate has dropped.
At the same time, the earnings of the wealthiest Americans have surged higher. Corporations are rolling in profits. Growth has strengthened. And the stock market has gone on an extraordinary tear.
The headline (U-3) unemployment rate for September was 5.9 percent, however the seasonally-adjusted real (U-6) unemployment rate was 11.8 percent, down from 12 percent in August. The latest Bureau of Labor Statistics (BLS) report estimates that 97,000 people dropped out of the labor force. Because you can’t be officially “unemployed” if you’re not looking for work, having a bunch of people give up looking for work makes the BLS unemployment rates lower.
As Forbes contributor Louis Efron pointed out last month, the U.S. has around 7.5 million underemployed workers. Most of the new jobs in this recovery have been low-wage and part-time jobs, which were taken by Americans just trying to survive while looking for a “real” job.
Reportedly 18% of workers in the U.S. now can’t afford to retire.
Lynn Stuart Parramore on AlterNet interviews journalist Jessica Bruder, who gives a bleak picture of the many older Americans who are forced to work past retirement age, and concludes:
The social contract is falling apart. With the death of pensions and the increase of short-term, temporary jobs bearing no benefits, we’re moving toward a winner-take-all economy with no safety net to help people weather hard times.
Lance Roberts looked at employment statistics and found:
With 24% of “baby boomers” postponing retirement, due to an inability to retire, it is not surprising that the employment level of individuals OVER the age of 65, as a percent of the working age population 16 and over, has risen sharply in recent years.
Can’t find a job? Blame grandma
…GOP economics is as bunk as everything else they do.
Despite the constant claims that paying people enough to actually live will destroy jobs, on average the states that raised the minimum wage are seeing higher than average job growth.
This could very well be due to other factors, and not because of the minimum wage, but certainly the minimum wage isn’t killing jobs.
Actually, turns out there is more evidence, and when we add that we start to see actual trends. As the Washington Post points out, raising the minimum seems to create jobs.
Naturally facts won’t change the arguments from the right. But I already wrote about that.
With the May jobs report, the U.S. economy is now back to pre-recession levels of employment. It took more than six years to climb out of the hole George W. Bush put us in (by “us” I mean everyone except the Wall Street millionaires and billionaires who are guilty of precipitating the collapse of the financial sector). That’s nearly as long as it took to recover from the Great Depression in the 1930s. On the Calculated Risk Blog, Bill McBride says, “I’ll be retiring the graph many called the ‘scariest jobs chart ever’.”
Although employment numbers have come back, (1) That only gets us to the same number of jobs we had in 2007, not to where we would have been without Bush’s Great Recession; (2) Unemployment would be higher than 6.3% if we counted the discouraged workers; and (3) Our economy has replaced too many living-wage jobs with low-wage jobs.
Jim Hightower, on AlterNet:
Employment rose by 217,000 jobs in the month of May, according to the latest jobs report — and that brought us up to 8.7 million. That is how many new jobs the American economy has generated since the “Great Recession” officially ended in 2009 — and it also happens to be the number of jobs that were lost because of that recession. You can break out the champagne, for the American economy is back, baby — all of the lost jobs have been recovered!
…Now, let’s move on to the value of those jobs that have economists doing a happy dance. As a worker, you don’t merely want to know that 217,000 new jobs are on the market; you want to know what they’re worth — do they pay living wages, do they come with benefits, are they just part-time and temporary, do they include union rights, what are the working conditions, etc.? In other words, are these jobs … or scams?
So, it’s interesting that the recent news of job market “improvement” doesn’t mention that of the 10 occupation categories projecting the greatest growth in the next eight years, only one pays a middle-class wage. Four pay barely above poverty level and five pay beneath it, including fast-food workers, retail sales staff, health aids and janitors.
…To measure the job market by quantity — with no regard for quality — is to devalue workers themselves. Creating 217,000 new jobs is not a sign of economic health if each worker needs two or three of those jobs to patch together a barebones living — and millions more are left with no work at all.
Via Think Progress:
Just 22 percent of those who ended up unemployed for six months or longer during the 2008 recession found steady, full-time work by the beginning of 2013, according to a new analysis from Princeton professor Alan Krueger as reported by the Wall Street Journal.
Looking at a Census Bureau survey of households between 2008 and 2013, he found that the rest of the long-term unemployed weren’t faring very well. The largest share, 35 percent, had dropped out of the labor force altogether, either giving up on finding a job, going back to school, retiring, or choosing some option other than job hunting. While 28 percent had found some employment, it wasn’t steady or full time. Another 14 percent were still unsuccessfully job hunting five years after they lost their jobs.
Republican economic sabotage is working. They killed public sector jobs. They cut off unemployment benefits six months ago. They are constantly crying about “The Obama Economy” (if only Dems knew how to frame issues that effectively!) Most of the new jobs being created are low-wage jobs with no benefits. It’s been 7 years since the last time Congress raised the minimum wage. President Obama has to go beyond giving speeches about job growth, and hoping corporations will do the right thing.
That said, let’s remember that the Obama administration has created more than 8.7 million jobs, compared to 1.1 million during Bush’s entire two terms. Bush was the first President since Herbert Hoover to have a net loss of jobs. GDP was going down when Bush left office. Republicans in Congress have prevented the Obama administration from doing enough to repair the economic devastation left by Bush.
Douglas Holtz-Eakin, former director of the Congressional Budget Office and economic adviser on Senator John McCain’s 2008 presidential campaign, offers a series of graphs that compare the so-called “recovery” from Bush’s Great Recession to the dead parrot of Monty Python fame (though Holtz-Eakin doesn’t credit the classic “Dead Parrot Sketch”).
For anyone not familiar with Monty Python, the “Dead Parrot Sketch” involved a pet shop employee who steadfastly refuses to believe a customer’s contention that the parrot he was sold is in fact deceased.
The government’s official reading of domestic growth clocked in at a puny annual rate of 0.1 percent, falling short of even the most modest expectations.
Writing in The New Republic, Dean Starkman counters the narrative still being repeated by the PTB and the media. The claim that Everyone-Is-To-Blame (EITB) for crashing the economy is not true. Wall Street financiers and predatory lenders are the guilty parties. Consumers didn’t suddenly start committing fraud on a massive scale in 2004 – that was the mortgage industry.
Why blame the victims? Because six years after the fact, no significant Wall Street figure has been criminally prosecuted. That’s a good enough reason, if you’re one of the crooks who got away with it.
I’m not suggesting that Wall Street has gotten a free pass on its role in the crisis. People get it, sort of. But we also grade on a curve that assumes that banks’ criminal or quasi-criminal conspiracies are par for the course, Wall Street just being Wall Street. …Borrowers who wound up underwater, by contrast, are pitiful at best. Either they were greedy or dumb or both. They really should have been more careful.
…Sorry, everybody was not to blame. “We” didn’t all do it.
According to a new NBC News/Wall Street Journal poll, 65 percent of Americans say the country is “on the wrong track,” and 57 percent say they believe we’re still in a recession. Republicans actively pursue measures to worsen the economy for average Americans (e.g. austerity budgeting, refusing to extend unemployment insurance), in the hope that their sabotage will be rewarded at the polls in November. There’s something really wrong with the two-party system if they can get away with this.
WASHINGTON, D.C. — Americans have a new No. 1 problem. Nearly one in four Americans mention jobs and unemployment as the most important problem facing the country, up from 16% in January. The government and politicians had topped the list since the government shutdown in October.
For the moment at least, right-wing Republicans have stopped deliberately trying to plunge us into another Great Depression. Maybe we can do start doing something about the mess they created. Too bad Dems have given up trying to re-take the House of Representatives. Howard Dean wouldn’t have given up if he were still in charge.