This page has been archived and commenting is disabled.

Guest Post: The Hollowing Out Of Private-Sector Employment

Tyler Durden's picture




 

Submitted by Charles Hugh-Smith of OfTwoMinds blog,

The financial and political Aristocracy will continue to do more of what's failed because they have no alternative model that leaves their power and wealth intact.

Frequent contributor B.C. has provided five charts that reflect the hollowing out of the private-sector employment. This has profound implications for education, taxes, housing and inequality.

Many people point to offshoring/global wage arbitrage as the key driver of stagnant wages and employment in the U.S., and this is certainly a factor. But we would be remiss not to note the other equally important drivers:

1. A system in which inefficient quasi-monopolies/cartels (defense, healthcare, education) are protected by a debt-based, expansionist Central State.

2. The exhaustion of the consumption/debt-based economic model.

What no one dares admit is that the U.S. economy is burdened by overcapacity (too many malls, restaurants, MRI machines, etc.) and too much debt, much of which was taken on to fund mal-investments (McMansions in the middle of nowhere, duplicate medical tests, costly weapons systems the Pentagon doesn't even want, etc.)

Consider this thought experiment. Suppose the offshoring of jobs was suddenly banned; only U.S. workers could be hired (setting aside that this is impossible in an economy where 50%-60% of U.S. corporate sales, profits and labor are non-U.S.; how are corporations supposed to compete in markets that generate 60% of their sales/profits if they can't hire local workers?)

Does a ban on offshoring suddenly make it profitable to hire more employees in the U.S.? No, it doesn't. Healthcare costs are still double those of our global competitors America's Hidden 8% VAT: Sickcare (May 10, 2012), and stagnant wages and high debt levels leave few opportunities for big profits.

Instead of developing new products and services, corporations either slash labor costs or belly up to the State trough of favored cartels: defense, healthcare and education. It is no mystery why these three State-protected sectors have seen costs skyrocket in a low-inflation, low-growth economy: college tuition has leaped by 1,100% above inflation and healthcare has risen 600% above the CPI (consumer price index).

Once the State enforces quasi-monopolies and cartels, inefficiencies rise because the feedback from reality (i.e. price) has been severed. This is how you get an economy where a biopsy costs $70,000, new fighter aircraft cost $200+ million each (six times the previous top-of-the-line fighter) and a conventional (i.e. non-Ivy League) college education costs $120,000 - $200,000.

Banning offshoring would simply create even more incentive to replace human labor with machines and software. As many observers have noted, robots are even replacing human labor in low-cost China because robots are cheaper and more productive than human labor, no matter how poorly paid.

Student Debt Has Tripled in Eight Years

Thinking About the Future – Technology & Crisis

Nations Must Prepare For Robots Destroying The Low-Skill Job Market

In other words, the erosion of private-sector employment has structural causes that are the consequence of the debt-burdened, crony-capitalist domestic economy and technological innovations.

Here are the charts B.C. sent along that illustrate the hollowing out of private-sector employment.(Chart notes are mine.)

Private full-time employment as a share of total employment: new low, and four years of unprecedented fiscal/monetary stimulus has pushed it back up to merely recessionary levels:

Private full-time employment minus health services jobs as a share of total employment: remove the State-protected sickcare cartel and the picture is even worse.

Private full-time employment minus health services jobs as a share of the total labor force: subtract government and healthcare jobs and roughly half the labor force has a private-sector job.

Part-time employment as a share of total employment: roughly 1 in 5 jobs is part-time, and does not pay enough to support a household, even a one-person household.

Part-time employment as a share of the total labor force: much of the vaunted increase in employment of the past four years is part-time jobs that cannot support mortgages, consumer debt, healthcare costs, auto loans, or even rent.

B.C. included this link and commentary:

53% of Recent College Grads Are Jobless or Underemployed (The Atlantic)

 

 

Less government and health services employment, only about half of the labor force is employed full-time.

This is precisely why half of college grads are unemployed or underemployed, i.e., part-time work at low pay. Statistically, if they are not employed in government or health care, they have no more than a 50% probability of obtaining ANY full-time private employment.

At ~18% of the labor force employed part-time, those 50% grads who do not obtain full-time private employment outside health care must compete for the 1 of 5 jobs in the labor force that are part-time, implying that no more than 59-60% of college grads will obtain ANY employment under current labor market conditions, leaving ~40% of grads with no prospects for earning purchasing power.

Is it a surprise why student loan delinquencies have begun to soar? How will the housing market grow with as many as 40-50% of high school and college grads unemployed, underemployed, or unemployable?

From my experience, perhaps as few as 10% of the population know the information above. Most in the top 10% don't know because they are largely unaffected and thus don't care and will not be persuaded that they should care until they have to (i.e. when their children experience the aforementioned conditions).

The vast majority of the bottom 90% don't know because they spend their waking hours trying to survive and can't do anything about it were they to know. Those who do know tend to be well-positioned economists, politicians, and similar types who have no financial or professional incentives to share the information because no one in the top 1-10% cares to know or do anything about it.

How do you maintain a mass-consumer, debt-based economy with only half of the labor force with full-time private employment outside of health care, accelerating automation of labor and loss of incomes and purchasing power, 40% of the youth with little or no purchasing power, and 90% of the population relying in old age on transfer payments from the wages of younger wage earners and their struggling employers? You can't.

So the mass-consumer economy and welfare-state for the bottom 90%, elderly, underemployed, disabled, young, and poor is not sustainable. Now what?

Thank you, B.C.

I would like to add a few points:

1. Healthcare, defense and education are all bubbles that are about to burst as debt-based government spending must slow, and this means the "you have a guaranteed job in this sector" mindset that has been true for the past 50 years will change.

Rather than obtain a guaranteed full-time job, those entering these fields (other than M.D.s, in which a critical shortage looms large) will be competing with vast hordes of other job seekers who also believed these were "safe" careers. The same can be said of law, as the era of "Big Law" is over as large law firms shed attorneys and reduce compensation. BigLaw Growth is Dead: Here's What's Next.

2. Sickcare acts as a systemic tax, as does the cartel defense industry. Politicians love defense and healthcare spending because they believe it "creates jobs." But since these are largely unproductive mal-investments, for reasons I have highlighted here many times, State spending on these sectors is extraordinarily ineffective at creating not just jobs but productive investments of labor and capital.

To take but one example of thousands: western Pennsylvania has about as many MRI machines than the entire nation of Canada. Those who own the machines funnel thousands of people into their labs to take unnecessary or duplicative MRI tests as a profit-mill. Since the State (Medicaid and Medicare) and insurance will pay for any and all tests deemed "necessary" in a system that revolves around defensive medicine, i.e. doing whatever it takes to avoid future lawsuits, this waste makes perfect sense in terms of generating profits.

Sickcare Will Bankrupt the Nation--And Soon (March 21, 2011)

According to local media reports, Western Pennsylvania has about 140 MRI machines, while the 32 million residents of Canada share 151 MRI machines. And the machines are getting a lot of use: the number of CT and MRI scans (scans other than old-fashioned X rays) tripled from 85 to 234 per thousand insured people since 1999.

While proponents are quick to note that scans are cheaper than the alternative diagnostic procedures, one firm's research found that a doctor who owns his own machine is four times as likely to order a scan as a doctor who doesn't.

Add in massive amounts of fraud (billing Medicare for tests that were not even given) and 40% of the system costs wasted on paper-shuffling, and you have a system that is literally crippling the entire U.S. economy with its high costs, fraud and waste.

3. Where does the leadership of our multiple layers of government think future tax increases will come from when private sector employment is eroding and half of all college graduates are unemployed or earning low pay in part-time jobs? The wage-base for higher taxes to pay for ballooning entitlements is eroding, too.

4. We suffer from a systemic failure of imagination. The financial and political Aristocracy that rules the neofeudal, financialized economy have no other model other than debt-based misallocation of capital and endless growth of debt-based consumption. That this model is broken and cannot possibly get us where we need to go does not matter; they will continue to do more of what's failed because they have no alternative model that leaves their power and wealth intact.

America Is Just Going Through the Motions (November 19, 2010)

We Have No Other Choice (March 15, 2012)

What If We're Beyond Mere Policy Tweaks? (February 6, 2012)

The Junkie in the Pool and False Idols: Faith in Wall Street and The Fed Has Eroded (August 10, 2011)

 

- advertisements -

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
Tue, 03/05/2013 - 15:58 | 3301852 LawsofPhysics
LawsofPhysics's picture

"Beating expectations" - all the way down.  Humanity isn't just a ponzi, it's the ponzi.  Thanks for stating the fucking obvious, again.

Tue, 03/05/2013 - 16:05 | 3301874 Ahmeexnal
Ahmeexnal's picture

slave species. created to mine for gold. Now guess where all that missing gold was sent? Not to china.

Tue, 03/05/2013 - 16:12 | 3301895 kaiserhoff
kaiserhoff's picture

Great article.  I would just add that 20 years ago, no one would have believed most of this abuse was possible.

It would have been regarded as another crazy conspiracy theory.

Tin hats uber alles.

Tue, 03/05/2013 - 16:27 | 3301952 LFMayor
LFMayor's picture

because you have to fly light years to get gold, right?

Sort of like Coors beer, back in the 70's.  West of the river, only.

Wed, 03/06/2013 - 03:03 | 3303958 All Risk No Reward
All Risk No Reward's picture

The road to serfdom in chart format.  The rough part of the road still lies ahead.

The energy field that empowers these cirminals is the debt based monetary system.

This chart shows how the two faces of money (asset money and liability owed to create money) flows through society:

http://www.keepandshare.com/doc/3324744/wmdebt-graph-3-79k?dn=y

Note that the only two classes of people that really matter are:

1. The debt definer / creator class

2. Everyone else

Yes, "the Jews" are over represented in the 1st group, but I'd venture to guess that 99.99+% of "the Jews" are in the second group.

Alas, the demons (content of character issue, not religious, skin color, whatever issue) love being grouped in with much larger groupings so the simple minded won't be able to zero in on WHO is persoonally responsible for this crime spree.

Group #2 needs to get together and call group #1 to account.

Of course, that's why group #1 spends all day dividinig and conquering group 2.

Wed, 03/06/2013 - 10:20 | 3304498 Chuck Walla
Chuck Walla's picture

Chavez had the answer, but he died. Viva la Free Cuban Healthcare!

FORWARD SOVIET!

Tue, 03/05/2013 - 16:04 | 3301862 otto skorzeny
otto skorzeny's picture

why does the "shaded area indicates US recession" end in 2009? oh-I see- it's a Federal Reserve chart-so that means the #s are even worse than posted

Tue, 03/05/2013 - 16:55 | 3302093 bornlastnight
bornlastnight's picture

I was looking at that myself.  According to the first chart (Private Full-Time Employment as a Share of Total Employment), none of the bottoms were below .65.  Yet for the last recession in 2008 ending in 2009 up to and including 2013, the line barely touches .66.  It just seems that using previous recessions and the employment graph as a guage, we're still in a recession.

Tue, 03/05/2013 - 16:07 | 3301881 lotusblue
lotusblue's picture

It'll be curious to see if population drops as jobs do over time.

In finite world continued growth is mythical illusion.

Paradigm shift required for existance to continue or certainly we'll see diminishment of our society.

Tyler,Thanks for posting and post more in this area.

Tue, 03/05/2013 - 16:12 | 3301894 doggis
doggis's picture

love charles hugh - smith's work!!   So Charles let me ask you something. What happens when you get health care insurance providers (think WELLCARE) that are CO -ORDINATED by the FEDERAL GOV'T to bill MEDICARE (CMS) using the information from DEAD PEOPLE?

 

What happens when the money from said FRAUD is then laundered to another part of government to fund 'SPECIAL OPS'.

What happens when the government then STEPS in to TAKE DOWN said company [think WELLCARE] to hide its tracks. what happens when the trial of the executives of WELLCARE which started recently has issued a media blackout by the government.

If WELLCARE was doing it, you can bet AETNA and CIGNA and UHC are all in on it......

what then charles?? huh??

 

 

Tue, 03/05/2013 - 16:16 | 3301908 otto skorzeny
otto skorzeny's picture

I thought I was paranoid- but you make good points

Tue, 03/05/2013 - 16:22 | 3301930 Panafrican Funk...
Panafrican Funktron Robot's picture

And shit, this isn't even counting the baked-in fraud that is actually totally legal and "above the board" per our illustrious legislative entities.

Wed, 03/06/2013 - 03:06 | 3303961 All Risk No Reward
All Risk No Reward's picture

There's simply too much money to pillage they get sloppy sometimes.

All those trillions in drug laudnering money they are running out of Afghanistan...  the trillions in theft from the tax payers...

Perhaps the $2.3 trillion that was reported missing on 9/10/01 whose records where then allegedly hit by a plane on 9/11/01 needs to get laundered into the banking system ahead of the ultimate credit bubble collapse that is straight ahead.

Tue, 03/05/2013 - 16:13 | 3301897 Trucker Glock
Trucker Glock's picture

"I never love your mudder.  I marry your mudder cuz she had six job."

https://www.youtube.com/watch?v=r-nJJTxaoSI

Tue, 03/05/2013 - 17:15 | 3302166 zuuma
zuuma's picture

LOVE your avatar, Mr. Glock!

Kitty kitty kitty!!

HAHAHA

Tue, 03/05/2013 - 16:19 | 3301918 Panafrican Funk...
Panafrican Funktron Robot's picture

Elimination of the minimum wage, all payroll taxes, and all corporate tax, would be a good start.  It's gigantically fucking stupid that we tax anything other than transactions/sales.  

Tue, 03/05/2013 - 16:22 | 3301923 IamtheREALmario
IamtheREALmario's picture

A. The financial and political Aristocracy will continue to do more of what's failed because they have no alternative model that leaves their power and wealth intact.

TRUE

The financial and political Aristocracy lacks imagination. They have become dependent parasites on the imagination of others, using their fiat wealth creation power as a system of slavery. The result of people waking up to the cage around them has been that they are less willing to be mind-slaves to the parasites.

B. We suffer from a systemic failure of imagination.

FALSE

There is an overabundance of imagination. However, the financial and political Aristocracy are so afraid that they stifle/KILL innovation, independence and ambition when they see it, and sometimes the people who possess it, UNLESS they can absolutely control it themselves.

For example: Do you think the "funding" and "patent" systems are designed to stimulate creativity and innovation. The exact opposite is true. Both systems are designed to CONTROL independent thought and then channel it through the power systems. This is because the elitists are deathly afraid of losing their control.

Tue, 03/05/2013 - 16:35 | 3301939 tickhound
tickhound's picture

Since "human labor" is part of our general economic equation.  And DESPITE this there remains an OBVIOUS trend to replace it and subsidize consumption... Why, if I promise to voluntarily share information and ideas swimming in my head with all Humanity and Machines, am I not INSISTING that this automation trend continue?

When are we going to WANT systems to be created built around REPLACING the need to put a value on my sweat?  OMG!  A system that could allow for MULTIPLE interests for any human when not bound to a SINGULAR skill or profession.  GAWD forbid I'm invited to think rather than react.     

If a monkey can do some of this shit, certainly a robot could do it more efficiently. 

OMG freaking pandora.   

Tue, 03/05/2013 - 16:30 | 3301965 Sandmann
Sandmann's picture

Sorry to rain on your parade but I think the Private Sector is inefficient and cartelised too which is why growth stagnates. The concentration in supermarkets has caused concentrated in food-processing and de-natured food. The consolidation in every sector has led to administered prices and job loss. Great companies like Compaq were destroyed by merger with HP which was itself destroyed as a dream engineering company. IBM created so many new companies by open-sourcing the IBM PC and now everyome goes closed system to lock people in to IOS or Cloud or removing DVD drive or subscription model.

The Cartels need breaking - firms like Kraft, Sara Lee, Wal-Mart

Tue, 03/05/2013 - 16:35 | 3301999 insanelysane
insanelysane's picture

You forgot Hostess.

                                       Oh, never mind.

Tue, 03/05/2013 - 16:44 | 3302037 NotApplicable
NotApplicable's picture

Did you ever wonder how these cartels came to be?

Here's a hint, it wasn't due to excessive competition in an unregulated environment.

Cartels are purely a government phenomenom. Without barriers to entry erected by the regulators, any cartel would be quickly undermined by a lower cost competitor, and would CEASE to exist.

In other words, they don't have to be broken. All that needs to be done is to remove their benefactor, Uncle Sugar (and his gun).

Tue, 03/05/2013 - 17:31 | 3302196 Radical Marijuana
Radical Marijuana's picture

There are no practical solutions to the problems caused by the best organized criminals being able to take control of the government by applying the methods of organized crime. There are cartels within cartels, while the public cartels are less in control than the covert cartels. There are no longer any practical ways to change the public cartels, because they have already been totally taken over by private cartels. One of the symptoms of that are that private military contractors are ascending over the public military. The boundaries have blurred because the system as a whole is made of cartels nested within cartels, going through an almost infinite tunnel of deceits, backed by destruction.

The Federal Reserve Board is the supreme American cartel, but that was an expression of a much bigger historical process of the prolonged triumph of the principles of organized crime controlling civilization. The theoretical problem is that there is nothing which can be realistically done which can operate outside of that endless series of covert controls, backed by things like bribery, intimidation and assassinations.

Wed, 03/06/2013 - 02:25 | 3303909 Sandmann
Sandmann's picture

Crap. Cartels exist because KKR buys up businesses or Carlyle or Warren Buffet. What good is it Kraft owning Cadbury, Jacobs, Tobler, Terrys, and then having to split into a US and Non-US business called Mondelez ? Why buy all this stuff if it becomes too big for Kraft ? Why does HP need Compaq, Autonomy, Palm, 3Com, EDS - 116 acquisitions since 1986 ? Is it now a better company either for shareholders or employees or customers. It was an engineering company now it is an ink retailer. If this is successful US business get ready to have Chinese owners.

Apple is a huge US company but only a film studio - it writes the script but shoots the movies abroad - without Taiwan it is nothing. No wonder Samsung has started eating its lunch.  Does the US actually have a car industry ? It looks like a beached whale outside the US...does Ford still exist ? Is GM now merged completely with Peugeot ? Has Chrysler been swallowed by Fiat ?  Mexico outproduces Detroit - so does Ontario.

There is no competition because of US Corporates snuffing out competition. How many times has Skype been traded ? Three times in 6 years ! US businesses are now Asset-Traders not real producers as in Asia. The more similar a US Corporation is to a Bank the higher its Stock Price

Tue, 03/05/2013 - 17:05 | 3302129 LawsofPhysics
LawsofPhysics's picture

Wrong.  Real growth in any one species stagnates because it is fucking impossible for any species in a closed system to exponentially consume more energy forever.  It takes energy to actually do anything, period.  In particular, the more mouth you have to feed, the more energy you will need.  Really fucking simple folks.

Tue, 03/05/2013 - 16:38 | 3302021 q99x2
q99x2's picture

Give everyone a Million Dollar Bonus and it will all work out.

Tue, 03/05/2013 - 16:49 | 3302062 Whizbang
Whizbang's picture

This is an interesting piece, but removing the healthcare jobs from employment is counterintuitive. Healthcare is an actual need, and whether there are monopolies or not doesn't change the fact that it is an industry which is needed, and it's need is going to rapidly increase over the next 20 years. The future of the united states economy is going to involve a lot of young people taking care of a lot of old people, at this point are we assuming a 70% unemployment rate because these jobs are 'invalid' according to the author?

Tue, 03/05/2013 - 17:17 | 3302170 Oldwood
Oldwood's picture

Need is serviced by the supply response to demand. If a service is adequately needed there will be a market response. A monopoly is the opposite of a market. As it can limit supply, it can set price, and set it high. Shortages will occur if a product or service is not available, simply because there is none or because supply has been deliberately restricted by price. Food is one of the essentials. Should we have a monopoly in food? Should Michelle decide what we eat and how much it costs? Central command economies don't work because they disconnect supply from demand and create false markets, like wall street, that will be proven again, to be unsustainable. As long as the governmetn isn't involved there will be plenty of people willing to care for the elderly, if us old folks are willing to pay enough. Social Security aside, nobody owes me anything. People have been dying poor for eternity. Besides, ain't none of us gettin out alive.

Tue, 03/05/2013 - 20:15 | 3302920 ElvisDog
ElvisDog's picture

The problem with what you wrote is that "taking care of old people" is not a productive job. It doesn't produce anything tangible and those people working that field have to be paid by other people who actually produce real, tangible, tradable goods. Or maybe the robots will take care of all the real production and people will change bedpans? What a wonderful future that would be.

Tue, 03/05/2013 - 16:49 | 3302071 Its_the_economy...
Its_the_economy_stupid's picture

I work in an odd industry that is paid for its services by a party not receiving said service. Automatically warning bells should be going off in everyone's minds.

So when I began in said industry, my office employed me and 3 others to perform said work. Over the course of 3 decades the work has changed very little, and the payments for said work have changed not at all. Ooops, my bad, they are now lower than 3 decades ago.

 

So now my office employes me, and nobody else. Just me, but the work load is the same. What quality of work can be possibly expected in this scenario? Where is everyone else working that used to work here? Where are all these displaced workers winding up? What further economy can be gained from my workplace, if economy is the word? As it stands, 30% of the work doesn't get done or reimbursed because there is simply no one to do it?! WTF?

Tue, 03/05/2013 - 17:03 | 3302114 Oldwood
Oldwood's picture

We hear the governments, state and fed constantly  professing their pursuit of employment. They have spent untold billions if not trillions trying to get employment numbers up. I am a small business guy. I have four employees currently and would like to hire another, but only part time. Unfortunately to hire someone, even part time, means you must pay unemployment taxes on them. This by itself is not a huge hurdle. The problem is the potential for unemployment claims. Even for short term, part time employees, if I run out of work and have to lay them off, I must pay their claim. In 09 I had to fire one guy. My rate went from .2% to 3.2% because they calculate a payback from my remaining employees over three years. Now I have been paying into the insurance fund for a total of 30 years, but if I lay someone off, I still have to pay it back, and the fewer remaining employees, the higher the rate. I again had to let another guy go in 2010. My rates went from 3.2% to 7.3%. That was before they had really settled in on this 99 weeks of unemployment. My chargebacks were based on 26 weeks. We have no idea if or when the states will be forced to make the employers liable for the full 99 weeks, but you know it will happen and it will be retroactive, so even if you hired someone when they were just doing 26 weeks, all that matters is when you fire. Anyway, my point is that they could go a long way towards taking stress off of employers by simply allowing us to hire people who currently have no job and employ them without risk of claims for say one year. We are all hanging on the edge here. We want to do what we can, but it feels like they are telling us we should be hiring but look out! The same as my local banker told me a few years back. The government bitching at the banks for not lending while at the same time telling them "don't fuck up and make some bad loans, cause we will shut you down". This is a mess. Even when you want to do the right thing you have to put your neck on the line.

Tue, 03/05/2013 - 17:55 | 3302304 michigan independant
michigan independant's picture

I was in the same boat some years ago. They made it so bad on local, state, federal I liquidated and went black. Black box that is as in the rise of the machines. Stocks are for rent and bonds are for ladders.

Tue, 03/05/2013 - 17:05 | 3302125 WTFUD
WTFUD's picture

Heart breaking the whole nine yards! What's most upsetting is the way these public and private tools smugly stand over us scratching their balls in contempt of us!

Tue, 03/05/2013 - 17:33 | 3302182 Radical Marijuana
Radical Marijuana's picture

...  M.D.s, in which a critical shortage looms large ...

Becoming a medical doctor within the profit from disease system is like volunteering to join the army, to fight insane wars. The profit from disease system, that overwhelmingly dominates medicine in America, is a chip off the old block of debt slavery, backed by wars on deceit, which are both runaways towards debt insanity, backed by insane wars. The overall statistics are that the current American "medical system" kills at least an order of magnitude more people than the American "military system" does. Therefore, becoming a medical doctor in America today is like volunteering to get up close and personal with the processes of torturing people to death.

There is nothing within those established systems which can fix themselves. The problem with becoming a medical doctor is that you must be smart enough to eventually figure out how evil your job is! That is why the average age of doctors is 55, and there are not enough new ones. Anyone smart enough to be able to become a medical doctor is also likely smart enough to figure out how insane the medical system has become, and that that is going to get way worse. Everything that this article says may be correct, but those statistics become much more personal, or in your face. if you become a medical doctor within those established systems!


Tue, 03/05/2013 - 17:45 | 3302269 Oldwood
Oldwood's picture

Is that anything like farmers profiting from hunger?

Tue, 03/05/2013 - 17:48 | 3302278 Oldwood
Oldwood's picture

Not sure what you think the alternative is. Michelle printing out your meal program and Barack running your exercise regiment? Or are you simply suggesting that after ingesting 40 years of crap, you just roll over and die?

Tue, 03/05/2013 - 20:18 | 3302934 ElvisDog
ElvisDog's picture

Well, I think the alternative is to make lifestyle choices that should minimize your need for healthcare. Like don't be a sedentary fat ass, so you won't need hip replacement. Things like that.

Tue, 03/05/2013 - 22:48 | 3303459 Totentänzerlied
Totentänzerlied's picture

Yeah that'll treat all those genetic and congenital diseases.

Tue, 03/05/2013 - 17:46 | 3302273 NoWayJose
NoWayJose's picture

Excellent article.  In a global economy suffering from overcapacity, the one thing we don't need is trillions in new liquidity seeking a place to go.

Tue, 03/05/2013 - 17:47 | 3302274 Kreditanstalt
Kreditanstalt's picture

You mean we're NOT in a "sustainable recovery"?

Tue, 03/05/2013 - 18:25 | 3302493 newworldorder
newworldorder's picture

Another major factor to structual unemployment is how major employers think of and treat employees.

In the US, employees have become a comodity to be hired and fired "at will," as individuals with little or no protection under law. If one is not a "protected class" employee or work under an employment contract, you work at the whim of the employer.

As a comodity and under the same "just in time" procedures used to source raw materiel and parts, the employer is free to hire or contract out for those employees who have specific skills, technical tools, education, certifications, etc. Coupled with H1B contract to permanet hiring American workers are at a disadvantage when they apply for positions.

With unrestricted outsourcing, open borders, just in time hiring practices and unwillingness of the government to protec US Citizen hiring, many employers have simply moved away from considering US citizens as first on the list of hirable qualities.

How to fix all this. Individually and collectively, citizens need to get mad at the way they are being treated and demand change. It is however highly unlikely that this will happen. Most of those turned down daily from jobs they could do - sheepishly accept the reason given to them by a perspective employer when turned down, - that "another applicant was more qualified," without knowing the circumstances of how and with whom the employer filled the job.

Only in the US can employers act with such impunity. Pick any other country in the world where their government does not protect its citizens first for employment and job protection. You would be hard pressed to find one.

For those who might interpet my comments as pro union - they are not, they are however pro US citizen, where the protection of law insures that woriking Americans get a fair break on the hiring lines.

Tue, 03/05/2013 - 19:54 | 3302831 Oldwood
Oldwood's picture

Sorry but i got no pity. People are dumbasses. They have been told for years that buying cheap foreign goods would eventually destroy their own jobs and they did it anyway. All cheap exporting countries gain entry into the US market the same way. Japan did it by knocking off US goods starting with cheap disposable commodities and then eventually moving into higher end products that eventually displaced real jobs. The Chinese have done the same thing, starting with cheap disposable stuff and used that profit to attack the real markets. And US consumers have enabled them in every way. And look what they have for it. Tons of entertainment crap. Phones, Igadgets, flat screen TVs, but they still won't pay for healthcare. The one US industry that still has jobs. But of course we attack them as profiteering because we don't like the prices so we want Big Gov to come in and take that evil profit away. US consumers are directly responsible for every job lost. They tell their neighbor who works for a US manufacturer to go fuck themselves because they are over paid and can buy the same stuff cheaper at WallMart. God, the idiocy spouted by people who have never employeed anyone. Too scared or pathetic to go it on their own, will set screaming for their "fair share". I build custom furniture for a living and you know what, fewer and fewer people are willing to pay the same prices that I charged twelve years ago. But I'm sure a dumbass like yourself would be setting in my office screaming at me about how you "deserve" more money, while you trundle of to Ikea for the deal of the day. Just shoot me.

Tue, 03/05/2013 - 20:09 | 3302884 newworldorder
newworldorder's picture

You had me going for you till you called me a dumbass.

Since you know nothing about me, I will tell you that what I wrote was not purely opinion. It is factual from working in a number of large corporations over 25+ years and being very well versed in the Human Resources Policies and Practices of those corporations. You on the other hand personalized this without opening your mind to what truth "may be out there" that speaks to the state of working in America today.

Tue, 03/05/2013 - 21:26 | 3303160 Oldwood
Oldwood's picture

And exactly how long have you been selfemployed and how many employees are you personally responsible for? I don't give a shit if you worked for God a thousand years, it doesn't mean you know anything about what is killing jobs. Evil employers work to make money, and you know what? anybody can do it. Of course you can be the HR guy moaning over your poor compatriots who buy everything imported, and never ever have to do anything that actually produces anything or makes anyone a profit. Ultimately HR people are only worried about saving their own jobs, so if you want to carry a little guilt over that I guess its OK. But you, in person, go out and build something and try to sell it to your neighbor and see if you can make a living, then get back to me. No evil corporations, just you. The only jobs remaining are service and sales because those still are difficult to outsource to China. But you can bet if they do, you will be the first in line to buy it because your neighbor is just too damn expensive. Try making an argument instead of stating your resume.

Wed, 03/06/2013 - 02:31 | 3303920 Sandmann
Sandmann's picture

They used to buy Hitachi VCRs with RCA written on them. Americans don't care -they have retail malls full of junk. Even 20 years ago you could visit Interior Decoratotion fairs and see fake antiques with Made in Taiwan underneath. Noone seemed to care. Access to the US market is granted by US retailers - it used to be Sears now it is Wal-Mart with its $8 billion Bonded Warehouse in China. Just look at junk designer label clothing in the USA - Made in China.

Tue, 03/05/2013 - 20:20 | 3302939 ElvisDog
ElvisDog's picture

The counter to your argument is France, where there are so many worker protections that there is no job growth.

Wed, 03/06/2013 - 02:12 | 3303894 Sandmann
Sandmann's picture

Not clear - it is French Syndicalism that is the problem, Germany has worker protections greater than most Eu countries and has a highly productive workforce. It is also highly taxed, inflexible in regulation and bureaucratic. How long it can remain successful is unclear

Wed, 03/06/2013 - 10:17 | 3304490 Oldwood
Oldwood's picture

Its cultural. I don't think it would be reaching to suggest that Germans have always been more work motivated than the French, and when you see not just their work rules but what they actually produce, it is obviously measurable. The Germans want to win. They have always wanted to win. What have the French been willing to sacrifice to win at anything in recent history? Even in a collective, you have to want to win to actually succeed. Unfortunately, the collective kind of kills that winning spirit after a while, even in Germany.

Wed, 03/06/2013 - 02:10 | 3303892 Sandmann
Sandmann's picture

True. If Workers are a Variable Cost there is no point in investing in them. German carmakers go to South Carolina to find workers and train them "their" way and invest in them as a Fixed Cost to be retained. US Corporations are feudal fiefdoms with indentured serfs who lack the long-term commitment. The US approach suggests resource abundance and is ultimately doomed because US Corporations act like banks and exist only to bundle Cashflows. They have no other purpose than to ioerate like Investment Trusts

Tue, 03/05/2013 - 18:35 | 3302541 MedicalQuack
MedicalQuack's picture

On privacy and cost of healthcare, now we have insurers buying up the data on what we buy!  Of course they take it and resell it too and more flawed data.  Insurers have used data from drug stores for underwriting puposes for years.

Now WTF!  Why do they need to know everything we buy?  Will you be confronted one day by the clerk at CVS for buying a candy bar if you are a diabetic, but in actuality the candy bar is for your kid maybe, who is not a diabetic...well then you are adding to the bad eating habits of a minor?  Why do they have to know when you buy a plane ticket or what restaurant you at at last night...

Listen to this Algo Duped manager of a nursing home chain...I was trying to explain bogus analytics and he thought it was a good idea...

http://ducknetweb.blogspot.com/2013/03/insurance-companies-are-buying-up...

This comes back around to what I said earlier, half of all data analytics money is going to be wasted, for several reason.  The non linear folks out there are trying to make a buck with rediculous and error ridden math models. 

http://ducknetweb.blogspot.com/2013/02/half-of-analytics-investments-by....

Do NOT follow this link or you will be banned from the site!