This page has been archived and commenting is disabled.
In the Bowels the Jobs Report: 15.4 Million Missing Jobs
The long-term problem in the jobs report issued by the Department of Labor today—a problem in every jobs report since April 2000—is the strangely inconspicuous Employment-Population Ratio.
It measures the percentage of people age 16 and older who have jobs. It's not perfect. But it's the purest, least corruptible employment number out there: It's not seasonally adjusted, manipulated by the infamous "Birth Death Adjustment," or dinked with in any other way—unlike the headline numbers that have become a joke. And it hovers at a 30-year low.
After World War II until 1975, it bounced up and down between 55% and 58%. As women entered the workforce in ever greater numbers, the participation rate began to edge up; and after the recession of 1983, it went on a bull run that peaked in April 2000 at 64.7%.
Then it began to decline. Whatever the cited reasons. Outsourcing, innovation, off-shoring, tax laws, technological progress, corporate shortsightedness, cheaper labor elsewhere, whatever. When the housing bubble and related activities unfolded in 2004, it stabilized at around 62.3% and increased a notch to 63.4% in 2006. As the housing bubble deflated, it began to decline again. And then it crashed.
The ugly trajectory of the Employment Participation rate since 2000:
Today, it came in at 58.2% (a rounding error up from last month's 58.1%). These are numbers we haven't seen since August 1983.
In other words, 41.8% of the working-age people in the U.S. don't have jobs, as opposed to 35.3% in the year 2000. To convert this percentage into real people: Since the working-age population in the U.S. these days is 238 million people, a decline of 6.5% in participation represents 15.4 million jobs.
There are no green shoots or improvements or recoveries in sight. It's a structural issue. Every time a U.S. company outsources production or services to entities overseas, or buys from foreign suppliers when it used to buy from domestic suppliers, it removes more jobs.
A superb example—not only because of its majestic physical aspect but also because of its economic impact—is the new San Francisco Bay Bridge, the most expensive single structure in the U.S. Incredibly, its most prominent segment was built in China.
These jobs gone offshore will continue to drag down our economy, and no amount of money-printing by the Fed and no amount of hope-mongering by the White House and no amount of deficit-spending by Congress are going to change that. Only one thing will: A collective corporate decision to reverse the trend of off-shoring production and services. Because, mathematically, you can't grow an economy by removing jobs.
Wolf Richter - www.testosteronepit.com, "Where the truth comes home to roost."
»
- advertisements -
Wholesale Golf Products
Wholesale Clothing
Stuffed Animals
Wholesale Mouse
Wholesale Clothes Rack
Wedding Favors
Wholesale Frisbee
Wholesale Glass
Wholesale USB Products
Wholesale Bag
Giveaway Material
Solar Products
Wholesale Playing Card
Promotional Gifts
Wholesale Glove
Industrial Supplies
Pen Holder
Wholesale Scarf
Wholesale USB Flash Drive
Wholesale Cap
Writing Instrument
Automotive Products
China Suppliers
Wholesale Cap
Wholesale Bag
Promotional Gifts
Promotional Gifts
Fishing Supplies
Wholesale Binoculars
Wholesale USB Flash Drive
Crystal Gifts
Wholesale Playing Card
Wholesale Racks
Wholesale Fan
Wholesale Tableware
Personal Safety Products
Wholesale Magnifier
Wholesale Camera
Wholesale Mirror
Wholesale Tellurion
Wholesale Socks
Giveaway Material
Coin Bank
Wholesale Puzzle
Wholesale Stationery
I can smell sarcasm... and I like it.
To the machine issue, which I haven't addressed in my article: I agree, building machines (robots or not) to perform production work is a good thing because designing, building, and installing these things, writing software for them, and maintaining them, etc. are good jobs. The problem is that these machines are more and more designed and built overseas. Germany and Japan are huge in that industry, and China is catching on.
To the bridge topic: The company in China didn't have the facilities either. They'd never built a bridge before. They're into building container cranes. To fabricate the sections for the bridge, they had to build or convert infrastructure for it, creating an additional wave of secondary jobs (from engineers to manual labor). So now they have a facility to build more bridges and we have unemployment and budget deficits. Check out the article on the bridge. It's got a lot of details.
http://www.testosteronepit.com/home/2011/7/25/our-chinese-bay-bridge.html
“Because, mathematically, you can't grow an economy by removing jobs.”
I don’t agree!
Example:
A worker builds a machine to do the work for him. (This is a good thing, imo).
Basically he becomes “unemployed”. If you agree that machines doing manual labor is a good thing, than this new gained unemployment is a good thing.
Consequence for worker dough; no labor, no Federal Bank Notes, no food and water.
Can testosteronepit explain, mathematically (or not), the logic between Labor and Central Bank Notes?
In my view Central Bank Notes are the key factor of making unemployment a “bad thing”.
BTW, and I’m truly speculating, and it’s a little off topic since that bridge is not the vocal point of article; but don’t you think it’s kinda logic to build these mega steel projects in a place where you can actually build them. I mean; the machinery to build these things are immense. Why would you want to build a whole plant while one is already in existence. This bridge is a one-off anyway.
Dire times call for dire solutions.
Corporate incentive: If not made in America - it does not get sold in America. Period. No ifs ands or buts!
Offshoring of American jobs becomes a criminal act with incarceration as a consequence.
Clean out the cesspool that DC has become, along with that cesspit on Wall street. Incarcerate!
Throw out and redesign the election process.
Confiscate all Federal Reserve assets, then outlaw them, while incarcerating wrong doers.
Shoot first. Ask later. Dire? You're damned right it is! We need an itchy fingered sheriff thats honest.
I cant hardly read the new york times anymore.
Their top "story" on jobs was in reality an op-ed piece blaming republicans for the "uncertainty" and demand reduction, then saying "economists" worry that republican refusal to increase spending will harm the chances of the government providing more jobs.
The new york times really is a propaganda piece, nothing more. I guess I had not realized the extent to which it has become a democratic mouthpiece rather than objective reporting. Their are two sides to that story and one side is absent.
Yes! Well said.
That's why we have blogs like ZH and like a million others, and like mine www.testosteronepit.com "where the truth comes home to roost."
1. Create 100% tariff on all imported consumer goods. (+$400b per year to treasury)
2. Eliminate all corporate income tax. (-$128b per year to treasury)
3. Watch factories spring up, corporations move their headquarters to the USA, new businesses generated.
4. Employment goes up.
imho
100% tariff will create too much inflation and retaliation and we could not have the factories spring up fast enough. How about 2% additional tariffs per year. By year ten we will pay 20% more for imported goods and I will have started a factory to compete and hired hard working Americans. Eliminate the corporate tax and foriegn corporations will move here and hire Americans to avoid the import tariffs. When this country was started government lived off of tariffs and there was no income tax.
100% Tariff on consumer goods only. Capital Goods, commodities exempt. We don't need any more $1 flip flops from China.
100% tariff will create too much inflation and retaliation and we could not have the factories spring up fast enough. How about 2% additional tariffs per year. By year ten we will pay 20% more for imported goods and I will have started a factory to compete and hired hard working Americans. Eliminate the corporate tax and foriegn corporations will move here and hire Americans to avoid the import tariffs. When this country was started government lived off of tariffs and there was no income tax.
Like HFT! I know, let's pay humans to oversee the HFT robots, and the SEC can watch the humans. The extra humans can film robo-midget-tranny porn for the SEC to watch, and BAM, 100% employment. Someone call Congress, we're on to something here.
"Every time a U.S. company outsources production or services to entities overseas, or buys from foreign suppliers when it used to buy from domestic suppliers, it removes more jobs."
What? No mention of jobs lost to robots? How the hell do people figure they're able to buy those iCraps so cheaply?
Oh, I know! we can all get paid high wages supervising robots! There, problem solved! </sarc>
Robots DO NOT repair themselves nor do they program themselves (yet!), highly paid Humans do these jobs.
Subject: Taking hostages in a hurricane?
Dear Friend,
The waters have just begun to recede in Vermont. New Jersey is still reeling. North Carolina is just starting to pick up the pieces. But Republican House Majority Leader Eric Cantor is already taking Hurricane Irene's victims hostage.
Truly, Mr. Cantor has no shame. It's outrageous to take advantage of the urgent needs of hurricane survivors in order to advance his radical crusade to cut Medicare, Medicaid and Social Security. But that's exactly what one of the top Republicans in Congressional leadership is doing with his refusal to allocate money to disaster relief unless Congress first offsets that money with cuts to vital government programs.
I just signed a petition telling Eric Cantor to release the hostages and stop blocking funds for urgently needed disaster relief. You should sign the petition too. Click below to take action.
http://act.credoaction.com/campaign/hurricane_hostages/?r_by=26640-4136952-0dcX88x&rc=paste2
If you don't depend on the government you will have nothing to worry about. I lost my house in Hurricane Andrew, picked up, rebuilt and did not wait on a hand out. You are only a hostage to the government if you depend on the government.
But, self-reliance is "unfair" and/or "socially unjust", just ask any Progressive/Socialist!
$16 Trillion Dollars???
http://info.publicintelligence.net/GAO-FedAudit.pdf
PLUS!!!
Wall Street Aristocracy Got $1.2 Trillion in Fed’s Secret Loans
http://www.bloomberg.com/news/2011-08-21/wall-street-aristocracy-got-1-2-trillion-in-fed-s-secret-loans.html
PLUS!!!
SEC Covering Up Wall Street Crimes?
http://www.rollingstone.com/politics/news/is-the-sec-covering-up-wall-street-crimes-20110817
Plus!!!
How about the $2.5 Trillion in Social Security Bailouts??
http://moneywatch.bnet.com/retirement-planning/video/good-news-on-social-security/478373/
Tarriffs my friends. Eliminate the Karl Denninger "wage/environment arbitrage."
If everyone here is saying "Free Trade is/was a disaster," I have to agree. I know it's politically incorrect for some reason (I really still am not clear on the reason), but we will have to go back to protective trade policies to save ourselves -- since our "trading partners" will probably not be willing to help us recover industrial strength.
Protectionism won't start a "trade war" -- we're already in one with "Free Trade," and our workforce is losing.
When the phrase 'free trade' is used, supplant it with 'globalisation'.
Stock holders and corporate fatcats gain, the working class gets schtupped.
Edit to add: it's politically incorrect because for 20 years, the media, the republicans and now even the democrats are onboard with the meme that protecting our industries is 'isolationism', that we owe it to the turd world to hand over our industry, because america ripped them all off somehow, and eventually they will want to purchase our non-existant exports. and then, we can all ride our unicorns to lala land. (the One-World utopia)
It's suicide by design. Bring down America, to even things out.
"hand over our industry"
Huh?
"Industry" moved itself. It moved where it could more readily abuse workers, pollute more (externalize costs) and deploy MORE robots w/o having to address worker concerns (over it). I'm on no side here, just pointing out the facts.
Further, what we are experiencing is that the cost of continuing to consume MOST of the shit that industry is making is WAY to high, and that eventually most will become irrelevant (return to fantasy land where it belongs).
We outsourced the white hut with an illegal alien who has a family of illegal alien grifters. What a joke.
Every time a U.S. company outsources production or services to entities overseas, or buys from foreign suppliers when it used to buy from domestic suppliers, it removes more jobs.
And every time some person is laid off, that person goes on a personal austerity plan, buying only life's essentials. The market wheezes and dies, leading to more lay-offs..
We're fu--ed, and it's getting worse.
Meanwhile, the borders are wide open and we import 125,000 'techs' from India every month.
Suicide.
"Meanwhile, the borders are wide open and we import 125,000 'techs' from India every month."
Links, please.
However... tech? Sorry, dead-end*. I figured it out a LONG time ago (after waking up) that the REAL fundamentals will prevail: Food, Shelter and Water; if people don't start basing their productiveness on these then they (people) are going to be left behind.
* Just watch India crash and burn (as well as China).
Actually, money printing by the Fed will bring back jobs to the US. It will make US goods and labor cheaper.
"It is impossible to grasp the meaning of the idea of sound money if one does not realize that it was devised as an instrument for the protection of civil liberties against despotic inroads on the part of governments. Ideologically it belongs in the same class with political constitutions and bills of rights." ~ Ludwig von Mises
"This [Federal Reserve Act] establishes the most gigantic trust on earth. When the President [Wilson] signs this bill, the invisible government of the monetary power will be legalized.... the worst legislative crime of the ages is perpetrated by this banking and currency bill."
~ Charles A. Lindbergh, Sr. 1913
"When plunder becomes a way of life for a group of men living together in society, they create for themselves, in the course of time, a legal system that authorizes it and a moral code that glorifies it."
~ Frédéric Bastiat
"History records that the money changers have used every form of abuse, intrigue, deceit, and violent means possible to maintain their control over governments by controlling the money and its issuance." ~ James Madison
"Every normal man must be tempted at times to spit on his hands, hoist the Jolly Roger and begin to slit throats." ~ H. L. Mencken
Cheaper than the slave labor in China?
When we achieve wage parity, yes.
Sadly, no, but I think he is being sacastic.
Sadly, no one in power wants to grow anything. They just want to profit. Enormous difference between actual production and financial fuckery for profit.
Hormel and McD's fattens up the livestock sheeple on the cheap until............
"Sadly, no one in power wants to grow anything."
I don't consider it sad given that growth is the strategy of yeast and the cancer cell...
But, you can sleep better knowing that SOMEONE cares- Jamie Dimon recently stated that growth is more important than debt. Hm... I wonder whose children are going to come out ahead in this deal?
Unfortunately, US corporations aren't going to return jobs to the US until there is much more parity in labor costs. Either wages will decrease here, or go up overseas or the value of the dollar will fall and earning 80k/year here today will be like earning 20k. That is how much the standard of living will change. People just don't quite get it yet.
exactly why carry trades are so popular. I took $1,000 in FRNs back in 1996 and bought rubles (exchange rate was 1 FRN: 2,500 rubles). the exchange rate is now 1 FRN : 28 Rubles. Can't wait for that "tax-free" repatriation day. We are Russia, we just don't know it yet.
You know, all this talk about jobs and there's been little to no talk about Technological Unemployment.
I know the markets, economy, financial system, blah blah blah are all fucked. Is it time we start thinking about a new future yet or should we keep trying to come up with ways to relive the glory days of the past.
Computers/Machines can do almost anything these days, the ethos of everyone having a 9-5 M-F job is extinct.
Why dont you learn about the Luddite movement so you dont sound so ignorant about jobs.
Machines and computers can only do so much. Let's see a robot fix electrical wiring or plumbing. I agree that there is less need for labor in manufacturing and agriculture, which means there is less need for people overall. What do we do with the excess humans on this planet?
Luddite
Overall your assertion is correct but the labor we have does need to be more skilled. I speak from experience, as for the other "people" (like lobbyests, financial phucknuts, politicians, and bankers), I say we grind them up for fertilizer.
Less need for labor in agriculture? Care to wager whether this (historically short-term) trend will continue?
I didn't say less need for farms and food. It used to take hundreds of people to harvest crops like wheat, corn and cotton. Machinery will continue to replace crop pickers. Many citrus groves no longer use humans to pick crops. They have machines to shake the trees and another machine to scoop the fallen fruits up. Dairy farms now use machines to milk the cows.
"Machinery will continue to replace crop pickers."
Well, that's YOUR opinion/bet, one, which, as energy continues to decline, WILL prove to be incorrect.
The majority of humans on this planet are directly engaged in food production. Only those with blinders (western world elites) don't have a clue about how the world really works or what history's norms are.
But, fucking DUH! I tend to know about this shit, that's why I comment on it.
A fallacy. Someone has to build those machines. And it isn't America.
Oops! Missed this part in the ancient texts, the part about where "god" said that America shall build machines...
None of this shit is engrained in our DNA. Further, what?, build machines to build more machines? Like it or not, but Marx was right about what would happen when labor is displaced.
It takes PHYSICAL RESOURCES to make machines! The mere fact of wanting to manufacture shit means squat if you don't have the resources.
How long do you think that anyone can build "those machines?" Think this can go on forever? If not, then what do you figure will happen when this is the case? I'm sure some idiot will be saying the reason we can't make any more machines is because we've lost the "will" to do so, babble on a bit about regulations or whatever, ALWAYS missing the fact that there's insufficient physical resources to build with, as well as the fact that people won't be able to afford stuff built by robots (or other factory-produced shit).
As economies of scale reverse you'll see robots losing their jobs...
Yeah, reality sucks. Don't like it, don't prepare for it. Go back to staring at your iCrap while riding unicorns (in your mind).
Techno jobs are being offshored.
wait for OMAMA next speech... its real deal.. that guys knows,,, he was in university...
cant wait to hear...
from that speech monthly jobs will be at least 500.000
alx
500 jobs? Sounds about right.
You need to turn on/off the sarcasm. Some might think you are serious.
If the US used the same method to calculate unemployment as Canada or Europe the rate would be over 16%
What makes you think Canada and Europe are honest about their numbers?
harmonized unemployment
http://stats.oecd.org/metadata/publish.asp?ds=1&co=.unrtsd.......
here is a harmonised presentation of unemployment of EU and US
http://appsso.eurostat.ec.europa.eu/nui/show.do?dataset=lmhr_m&lang=en