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Distressed American Workers Expose The Fallacy Of Improving Unemployment Numbers
Submitted by Tony Sagami via MauldinEconomics.com,
“Over the past five years, our businesses have created more than 11 million new jobs. Our economy is growing and creating jobs at the fastest pace since 1999.”
—President Obama
Sure, the headline jobs numbers suggest that Obama is right and that the job situation is improving:
The Labor Department reported that initial claims for unemployment insurance fell to their lowest level in 42 years.
The Institute of Supply Management’s index of non-manufacturing employment (“Would you like some fries with that, sir?”) hit the highest level in 10 years.

The Labor Department reported that the US economy created 223,000 new jobs—the 57th month in a row of net job creation—and a drop in the unemployment rate to 5.3%, the lowest level since April 2008.
Sounds good… right? However, despite those feel-good headlines, the average American is far, far from solid financial footing. Here’s what I mean:
Job Growth but No Wage Growth. Job seekers may find it easier to find a job, but good luck trying to find a job that pays enough to support a family.
The lightly followed Department of Labor’s quarterly Employment Cost Index (ECI) is Janet Yellen’s favorite wage indicator for good reason: it most accurately reflects the true cost of labor to businesses.
Well… the ECI increased by 0.2% in the second quarter of 2015. That was not only way below what Wall Street was expecting, it was also the slowest pace of wage growth since 1982 when ECI record keeping started!
Those are bad numbers, but it is really worse if you dig below the headlines:
Devilish Detail #1: Government Worker Wages, Not Private Sector.
The overall ECI was up by 0.2%, but that is only because compensation for government workers increased by +0.6%.
What about the private sector? Change in compensation: 0%. Yup… ZILCH… NADA… ZERO… not a penny.
Devilish Detail #2: Benefits, Not Wages, Are Rising.
In the past 12 months, the ECI is up 2%. Sure, that kind of increase is nothing to shout about, but 2% is better than a sharp stick in the eye.
Hold on… not so fast!
Remember, there are two components of labor costs: (1) wages and (2) benefits like paid vacation, Social Security, workers’ compensation, and health insurance. Wages are roughly 70% of ECI, and benefits make up the remaining 30%.
Over the last 12 months, the cost of benefits has increased by +1.7%. My guess is that the lion’s share of that increase can’t be attributed to higher health insurance costs.
Moreover, the trend these days is for employers to pass on some or all of the higher costs of health insurance to employees, thus reducing take-home pay.
You know where else these measly wage gains are showing up? In homeownership.
Despite record-low interest rates, an increasing number of Americans are renting rather than buying. The Census Bureau reported that the US homeownership fell to 63.4%, the lowest level in 48 years.
The homeownership rate peaked in 2004 at 69.2%, but has been falling ever since.

Moreover, the rate of homeownership hasn’t been this low since 1967, when it was 63.3%.
The “Millennial” generation—defined as 18- to 34-year-olds—are living with their parents at an alarming rate. The Census Bureau reported that more Millennials are living with their parents than ever before.
In 2007, 71% of Millennials lived on their own, but the Census Bureau found that only 67% are living on their own now!
What does all this mean to investors?
As a participant in a consumer-driven economy, you should be worried—very worried—about the long-term direction of the stock market, because consumer spending is a function of how much money you have in your wallet.
As signs of slowing consumer spending and stalling retails sales are increasing… the stock market will soon follow.
The question is: How are you going to protect your portfolio when stocks slide into a bear market?
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The rent is too damn high!
Lot's people (on both ends - rich and poor) feel "entitled" to free money.
Fuck em, fuck em all.
Now now.... Let's all hold hands and sing Kumbayah and we'll all feel better.
Been singing for 8 years..................................I do not feel any better knukles.
Is there a song for "Where all doomed" in a Scotish accent?
Help is on the way, Trump will destroy the H-1B program and deport 50 million illegals.
https://www.youtube.com/watch?v=LykK_3fSZZ8
sounds Scottish?
Maybe this?
https://www.youtube.com/watch?v=iUxkFCBPgx4&list=RDiUxkFCBPgx4#t=14
or how about this?
https://www.youtube.com/watch?v=68LAbJtd4uk
What we really need to fix this economy is a larger population of cherished illegal aliens.
“Fundamental Transformation” will save us.
Love the Repo Man reference but I'm thinking this is the song:
https://www.youtube.com/watch?v=jHPOzQzk9Qo
This is what they are trained to do, Pavlov would be proud......
But Stawks...................are up
Sure falls under "Dreams of my Father". Because you are fucking dreaming Obongo if you think anyone believes your bullshit anymore!
: "The Audacity of My Father" and "Dreams of Hope"....
There is a whole army of people with Cell phones (free) that believe every word he says and will call you a racist for not believing him.
My eldest got a new job and is living in an apodment. It is much smaller than her bedroom at home. Lucky for her all her belongings can fit in her car. She pays $750/month and it will increase in 3 months. I damn near flipped. She paid off all her student loans and has no car payment so she can afford it but, Damn, this is obscene! My heart goes out to the millennials.
Miffed
She's lucky to have found an apartment she can afford by herself.
Not free money, which is inherently and categorically worthless by itself, but free energy, which is priceless.
You get a much better picture of unemployment in the land of the free from David Stockman:
At the present time, there are 210 million adult Americans between the ages of 16 and 68—to take a plausible measure of the potential work force. That amounts to 420 billion potential labor hours, if we accept the convention that all adults are at least theoretically capable of holding a full-time job (2,000 hours/year) and pulling their share of society’s need for production and work effort.
By contrast, during 2014 only 240 billion hours were actually supplied to the US economy, according to the BLS estimates. Technically, therefore, there were 180 billion unemployed labor hours, meaning that the real unemployment rate was 42.9%, not 5.5%!
Yes, we have to allow for non-working wives, students, the disabled, early retirees and coupon clippers. We also have drifters, grifters, welfare cheats, bums and people between jobs, enrolled in training programs, on sabbaticals and much else.
http://davidstockmanscontracorner.com/the-warren-buffett-economy-why-its...
As EROEI mean-reverts in accordance with thermodynamics, the delusional fantasy that 95% of the economy could be devoted exclusively to energy consumption is revealed as a fraud.
Stockman sees the statistical fraud, but still thinks the solution to not enough available joules is to use more joules ... to increase joule use capacity. He is as mystified by the jobless recovery as the mainstream he critiques.
No agricultural society ever experienced a real unemployment rate of over 5%.
Stockman's not wrong, but he doesn't address the elephant in the room - automation/technology.
Even if we somehow incentivized/achieved a degree of job re-patriation, entire sectors will never provide employment at levels enjoyed in the past because the tasks are largely performed by software (and coming soon, AI & robotics). And this as population growth relentlessly adds to the denominator. Thus surplus of labor is now structural unless some level of luddite/protectionist policy is put in place to encourage distributist/localized economies in the US.
A viable US economic policy has to encourage the creation of sustainable jobs across the US economic/labor supply spectrum - easier said than done, and many of the policies needed to affect such a transition are currently dismissed as radical/heretical and only discussed far outside the US political mainstream.
I'm not arguing for/against such things... just observing and scouting the logic of the next step...
The EBT/HUD/ACA lifestyle is far better than an equivalent minimum wage McJob. So why not sit on your ass and laugh @ the chumps who leave early and come home late every day? As long as you vote 'D', you could prolly make some on the side via "community organizing", or scamming a few of the wonderful free shit programs that make this lifestyle possible.
My friend sells insurance to companies and from her perspective, she is not political or opinionated on current events, and i quote from today's email: "ACA reporting is going to be the death of me!! I don’t know how these employers are going to keep up!! "
Its absoulty true, all the small municipalities are pulling thier "hair" out trying to figure out how to classify diffrent employees in thier reporting. The IRS is stonewalling questions to how they define the 4 basic groups. I do not see many of them complying simple because they don't know how. It will be intresting this October.
This is the continued war on small business. Large corporations have million dollar systems in place to handle that kind of data. You need to pay to play.
Oregon added 4,600 jobs in July, yet unemployment rose to 5.9%. It appears that there is an influx of people, primarily from California. EBT/HUD/ACA/legal marijuana?
Yes and when the mouth breathing moron voters, vote for more big gubmint "things" will be ever better!
Either you are a server a fry cook or a clerk at Sprawl-Mart or one of the dollar store spouting like weeds. Oh happy day $8.00 an hour for everyone. This is pretty much the same pay I was getting in the mid 80's working as a line cook, pathetic.
$8 (or even $10 an hour) 45-hours per week isnt going to support 50% of the income needs for an average "flyover state" lifestyle. Our nation is doing it wrong when individuals who are willing and capable of hard work cannot support themselves.
You got that right.
Who CARES what millenials do as long as they BTFD!
The kneegrow lies. Same as it ever was.
Community organizer, that's ripe.
Get rid of the illegals...including any in prison...simple in concept as well as implementation...give them 30 days to sell their shit and get the hell out, or else your ass is on the next container bound for china...let Walmart deal with the logistics, thats what they are good at...
Even if you did this with 100% efficiency you're only talking about 5% of the current US population. Now what for the remaining 95%?
Well Mr Smarty, lets through out all the coons too....
Ok, you're now up to 18% you've still barely made a dent. Maybe the solution doesn't lie in xenophobia?
Cheap ass service jobs will NOT pay the bills . A lot of the good paying jobs were off shored awhile back. Banksters are still cleaning up for now, but soon the shit will hit the fan HARD. Watch the rats scurry then. Hahahahahahaaaaa
Remember that you were created by a loving God.
You're not an ape.
Don't let them make you feel like one.
Power will flow from it.
You are better than any one of the monkey men on wall street.
If you are wrong about that, you won't be just wrong, you'll be dead wrong, just sayin.
Death is the great equalizer, whatever you believe.
I hope when your time comes, you hospital bed sheets are clean.
I prefer to go out on my feet.
Charles Darwin is not my God.
Charles Darwin is no ones "god".
He was a devoutly religious man who was wracked with self reproach about the incompatability of his scientific theory and his beliefs.
And yet he pressed forward, trying to find an answer that is still yet to be found.
Evolution is a theory. Its an incomplete attempt to explain a natural phenomena that has yet to be proven.
If it is proven, then it becomes a law, like the laws of thermodynamics.
Only imbeciles would take a theory and apply it universally as a law without proof.
By the way, can you provide concrete observable repeatable measurable proof of the existence of your "god"?
You, sir, are an imbecile.
Never understood why belief in God and evolution is mutualy exclusive. God being God obviously knew that by creating the Big Bang and all that came after, he would ultimately create Man. Why is that such a difficult concept?
I love cooking and serving Freedom Fries. Janet does too. That's equality.
Let's remove all jobs under 30 hours a week, all duplicate jobs and censor all jobs that are paying less then $12 an hour. Let's remove the individual mandate from Obamacare and allow people to work full time again rather then being extorted to buy insurance that doesn't even cover them. Allow businesses to go back to hiring full time with no penalties for not handing out benefits. Remove all government regulations on businesses under certain size threashholds and allow them to become profitable again.
Everything done under this adminstration has been a fraud, a crime and includes manipulation of the public by the media to get these crimes done. Add in the fact that Congress has backed this adminstration even though the GOP took Congress in November. The whole nest of criminals needs to be removed so that this country can get back to being great again.
The world is awash in surplus labor. Only domestic service jobs that need to be performed on site are growing. Anything that can be done by foreign labor, is being done by foreign labor. Wage pressure is down, down, down. No unions, mass immigration and work force dropouts. No pressure to increase wages, except in the sphere of public unions, who drive for higher wages each contract session.
Once plumbers, carpenters, brick layers, concrete workers, iron workers, fitters, you name it, they commanded the highest blue collar wages in America by far. That entire game is up, the politicians opened the borders to free entry and killed that high paying sector, replacing it with individual contractors from Mexico. At one time a carpenter was a highly skilled highly paid sought after job. Try going out on carpenter jobs today, and see 100 Mexicans lined up with pick ups full off tools and teenage kids with the old man. They work cheap, and often very well. The day of the white middle age union carpenter is over, though I remember them when I was a kid, My mother worked in a store that cashed Union Workers checks, most of them construction workers, in the 70's. She saw what was standard pay for those guys, and it was very good money.
Not only the money but there is something cathartic about men working together building things. A long time ago mr used to work weekends apprenticing for a general contractor. He framed, put up trusses, did electrical, plumbing, dry wall, cementing driveways. The guys teased him for being a computer nerd but he eventually won their respect. He told me all about the salt of the earth conversations and the challenges they had to overcome. Honestly, it was the happiest I ever saw him though he only brought home $3/hr after expenses. I wish he could go back but working 60 hours a week has eliminated his free time. At least, unlike so many today, he can fix or build just about anything and has top quality tools he bought over the years.
Young boys lounging around in a basement is just a travesty. In the old days they'd be hunting or learning a craft from their dad.
Miffed
Yep. My 70 year old father in law was a carpenter and his brother was too. FIL had to quit it early due to a broken back - became a small business owner. His brother retired as a carpenter and receives $2000 a month pension + $2000 a month social security.
Since it takes around 250,000 jobs to be created per month just to keep up with population growth this Obama economy is an epic joke.
Just google image search 'Reagan recovery vs Obama recovery' and look at the charts. They are ridiculous, the Obama recovery is pathetic at best. Every single chart shows just how terrible his leftist policies really are.
But when will the good people of western PA - and the rustbelt in general - start voting for better candidates & better policy?
I've been waiting for an individualist/distributist/libertarian movement to emerge in the midwest, but every election cycle is just like the last... older boomers, their gen X children, and millenials there continue to vote for the same party/idiocy that got us all into this mess in the first place.
Like all yinzers, I saw first-hand what crony unions & crony corporatists did to once-great american manufacturing hubs like Pittsburgh. But even now - 40 years after the collapse of the industrial base there - the rustbelt still votes reliably Blue/Dem, with some token neocon Red spreading in the suburbs. What needs to happen before people there wake up to the reality that their political system - both local and federal - has hung them out to dry? Sure, the Burgh is doing pretty well these days... but it's also 1/5th the size that it once was. Detroit, Chicago, Cleveland, etc. have not fared as well, and yet these cities/regions vote for their incumbent cronies more so than anywhere else... baffling.
I should correct myself here... Justin Amash of Michigan is exactly the sort of leader that I expected to rise and succeed in the midwest, but I thought there would be more like him by now. I hope more like Justin Amash will emerge and represent the majority that is uttlery unrepresented by the one-party establishment...
that is going to happen...when voting machines will get fixed
that is going to happen...when voting machines will get fixed
City_Of_Champyinz - By your logic then do you mean that if the Right held the reigns of the Presidential office we would be living in a glourious world of pleanty where people were healthy, somewhat happy and not too worried about the present/future? Would there be a; home for everyone, a chicken in every pot and two cars in every garage?
Do you really believe most charts would look much better if the right rather than left ran the executive branch?
Why?
TY in advance for any response.
The country needs more Hooter girls!
What about Hooter Boyzz? Someone is ignoring a niche market here I think...
Magic Mike kind or Frank Costanza kind?
All you need to do is look at:
1. Labor Force Participation Rate 1990-2015
2. Population growth 1990-2015.
Population is up, labor force participation rate is plummeting. Food stamps at all time highs, poverty rates exploding, historically low interest rates with home ownership dropping with no bottom in sight.
It's all according to plan, people. It's very hard to enslave a prosperous free society. But TPTB are succeeding. By 2030, we'll be destroyed.
2030? You think it will last that long?
If you think about it a bit you come to this Orwellian conclusion:
Everyone out of work and not looking for a job has a job.
Thank you Winston Smith.
Zion is a scheme, not an ethnicity.
The problem in a nutshell - Govt announces $11B loss on GM bailout; GM announces it is moving production of Buick line to China.