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These Ain't Your Grandfather's "Jobs" - Why Friday's Rip Should Be Sold
Submitted by David Stockman via Contra Corner blog,
The "“Jobs Friday" ritual is getting truly absurd. So it can’t be repeated often enough: These artifacts of the BLS’ seasonally maladjusted, trend-cycle modeled, heavily imputed/crafted and five times revised “jobs” numbers have precious little to do with the real health of the main street economy.
Indeed, the six-year run of job gains since early 2010 primarily represent “born-again jobs” and part-time gigs. In economic terms, they do not remotely resemble your grandfather’s industrial era economy when a “job” lasted 40 to 50 hours per week all year round; and most of what the BLS survey counted as “jobs” paid a living wage.
Not now. Not even close.
The Wall Street fools who bought the dip still another time on Friday do not have the slightest clue that the US jobs market is actually quite dead.
The chart below is also generated by the BLS but it measures actual labor hours employed, not job slots. It self-evidently puts the lie to the establishment survey fiction upon which the robo-machines and day traders are so slavishly focussed.
The fact is, labor hour inputs utilized by the US nonfarm business economy have “grown” at the microscopic annualized rate of 0.08% since the turn of the century. That’s as close as you can get to zero even by the standards of sell-side hair splitters, and it compares to a 2.02% CAGR during the 17 years period to Q3 2000.
So let’s see. Prior to the era of full frontal money printing, labor utilization grew 25X faster than it has since the turn of the century. Yet the casino gamblers bought Friday’s more of the same jobs report hand-over-fist—-apparently on the premise that this giant monetary fraud is actually working.
Not a chance. The contrast between the two periods shown in the chart could not be more dramatic. Nor do these contrasting trends encompass a mere short-term aberration. The death of the US jobs market has been underway for a decade and one-half!
Even in the establishment survey itself, the evidence of a failing jobs market is there if you separate the gigs and the low-end service jobs from the categories which represent more traditional full-pay, full-time employment.
The latter includes energy and mining, construction, manufacturing, the white collar professions like architects, accountants and lawyers and the finance, insurance and real estate sectors. It also includes designers and engineers, information technology, transportation and warehousing and about 11 million full-time government employees outside of the education sector.
We have labeled this as the “breadwinner economy” because the work week averages just under 40 hours in these categories and annualized pay rates average just under $50k. These kinds of family supporting jobs were what the Labor Department bureaucrats had in mind back in the 1930s and 1940s when the current employment surveys and reports were originally fashioned.
Notwithstanding all of the present era crafting, however, even the BLS establishment survey figures leave no doubt about the retreat of breadwinner jobs. At the peak in January 2001 there were 72.7 million of these genuine “jobs”, but that figure has never been seen again in this century!
In fact, after 95 Jobs Friday’s the count is still 1.3 million below the interim peak of December 2007 and 3% below the turn of the century level.
As a statistical matter, these 70.66 million breadwinner jobs account for just under 50% of the establishment survey’s 142.9 million jobs reported for November. By contrast, they account for upwards of 75% of total wages and salaries paid.
Needless to say, the stagnation of the breadwinner jobs market is the reason that wage and salary income growth has been so anemic. For more than 15 years the jobs mix has been steadily deteriorating, dragging the average annual earnings down with it.
Thus, since the year 2000 the number of jobs in what we have termed the Part-Time Economy has steadily increased. But these jobs in retail, bars, restaurants, hotels, amusement parks, stadiums and temp agencies average less than 30 hours per week and generate annual pay of less than $20,000. From an economic viewpoint, they are gigs, not jobs.
The same can be said for the balance of the establishment survey—-or what we have called the HES Complex (health, education and social services). While these jobs average about $35k of annual compensation, that figure is heavily skewed by a small number of highly paid health and education professionals such as doctors and administrators.
The overwhelming number of jobs in the HES Complex, in fact, pay well less than $30,000 per year.
At the end of the day growth in real wealth and living standards requires expansion of full-time employment and rising productivity per employee. The hard truth is that the debt-saturated US economy is not producing either of these essential ingredients of real main street prosperity.
Another angle on what can be described as the “atomization of work” is evident in the detailed breakout of wage and salary income that is published annually by the social security administration. This data on payroll earnings by annual income bracket is about as close to an honest measure of the US jobs market as you can find.
That’s because they are based not on surveys, estimates, imputations and models like the BLS figures, but reflect actual individual payroll records. It goes without saying that no employer sends withholding taxes to the IRS based on phantom jobs slots.
Here’s the thing. Last year 158.2 million workers had payroll records and withholding taxes and earned $7.1 trillion in compensation. Yet nearly 49 million or 31% if these workers earned less than $15,000 per year.
In fact, this massive cohort of part-timers and gig based workers generated only $300 billion of wages or only 4% of the national total. On average they earned just $6,200 during the entire year.
What Jobs Friday is about, therefore, is the cycling up-and-down of part-time jobs and gigs on the margins of the economy. These undulations occur in the intervals between the serial financial market booms and busts which result from Fed policy. Without so much as a fleeting acknowledgement, bubblevision indulges in the farce of counting slots mainly in the bottom 48 million of payroll records.
In fact, virtually all of the change in BLS job count occurs among the bottom 81 million payroll records reported by the social security administration. During 2014 these workers all earned under $30,000 per year, with an average of just $12,600.
That’s right. The bottom 51% of the work force earned less than 15% of reported wage and salary income, and clearly worked limited hours and exceedingly low hourly rates. Either that or the IRS is collecting taxes from employers who wantonly violate the minimum wage laws since the average wage for the bottom 81 million workers computes to $6.30 per hour on a standard work year!
In contrast to zero growth in hours worked and 0.4% annual growth in the BLS’ measure of full-time employment since the turn of the century, the ultimate category of gigs and episodic work——waiters and bartenders——has grown at a 1.9% annual rate. Accordingly, they accounted for 30% of all the “jobs” created in the American economy since the turn of the century, as reported in the BLS monthly establishment survey.
Call it the “Bread and Circuses” economy. The picture below is essentially what the talking heads work themselves into a bullish tizzy about - that is, until the bubbles burst purportedly owing to one-time accident and contagions that will never be repeated .
It goes without saying that goods production remains essential to wealth creation. Humanity has not yet been put in cocoons, nor would an economy work if everyone simply hired their neighbor to cook their meals, mow the lawn, clean the house, do the laundry and fix their electronic gadgets. Even Uber drivers need someone to manufacture their vehicles first.
Yet goods production—-mining, energy extraction, manufacturing and construction—continues to sink. There are still 2.4 million fewer jobs in the goods producing economy than there were at the pre-crisis peak in December 2007 and 20% few jobs in this foundation sector of the economy than in January 2000. 
Likewise, there has been a decline or no gain since the turn of the century in numerous other higher paying full time job categories. Friday’s job report, for example, posted 5.9 million jobs in wholesale distribution, which is the identical number recorded in November 2000.
For the six breadwinner categories shown in the graph below, there were a cumulative 11.7 million jobs reported for November compared to 13.4 million in November 2000. That’s a 13% shrinkage.
Nor can these trends be accounted for by some explosion of productivity and technology. That is, the idea that robots and driverless cars are displacing human labor at an accelerating rate.
Since the job market bottomed in early 2010, nonfarm productivity growth has decelerated sharply, averaging just 0.5% per annum. That is less than one-fourth of its historic rate.
In short, the current so-called business expansion is already long in the tooth at 79 months of age and the next recession is just around the corner.
Since the November jobs report was just more of the same there is not chance that the structural deterioration of the jobs market outlined above will be reversed before the current massive financial bubble bursts.
There would not be a better time to hit the button Cramer rarely uses and sell, sell, sell.
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Many jobs these days is standing on a corna' with a sign, or going to doctors appointments to get that sweet disability check.
Your grandfathers jobs were outsourced to slit eyed gooks working for a bowl of rice...and they ain't coming back!
http://beforeitsnews.com/conspiracy-theories/2015/12/road-to-ww3-time-to...
We Need MORE TSA people to keep us SAFE!
LOL!!!!
We Need MORE Government Workers Period!!!!!
LOL!!!!
More Department of Public Works Guys Too!!!!!
LOL!!!!!
That's what my best friend is doing. He's in his 50s and has metal hips, but the problem is, he's white. I mention his whiteness because he's been told at agencies that help folks get on disability that if he were black he'd have gotten it no problem. But no, he was denied so now he's going to tons of doctors, spending so much time and other people's money on this idiocy. He might as well be working a shitty gig. I don't have the heart to remind him it's futile because we both know that shit is bankrupt. Poor bastard will hardly get a dime in the end I'm afraid. Then we've got this skinny little black kid in town who is supposedly mentally ill. I've seen no signs of mental illness aside from extreme financial stupidity and homosexuality. But he gets his $700-$800 every month from Uncle Sugar and then goes out and blows it on faggy clothes, cigarettes, and drugs. Then not a few days later he's begging me for cigarettes. Joke's on him now, I quit smoking!
Are these real jobs, or changes in coefficients?
A number or symbol multiplied with a variable or an unknown quantity in an algebraic term. For example, 4 is the coefficient in the term 4x, and x is the coefficient in x(a + b). A numerical measure of a physical or chemical property that is constant for a system under specified conditions.
BLS uses Algebra to deceive you.
Most of you don't know what Algebra is.
Oh My Gosh!!! This CANNOT be!!! Something good Muslims did???
Algebra (from Arabic "al-jabr" meaning "reunion of broken parts"[1]) is one of the broad parts of mathematics, together with number theory, geometry and analysis. In its most general form, algebra is the study of mathematical symbols and the rules for manipulating these symbols;[2] it is a unifying thread of almost all of mathematics.[3] As such, it includes everything from elementary equation solving to the study of abstractions such as groups, rings, and fields. The more basic parts of algebra are called elementary algebra, the more abstract parts are called abstract algebra or modern algebra. Elementary algebra is generally considered to be essential for any study of mathematics, science, or engineering, as well as such applications as medicine and economics. Abstract algebra is a major area in advanced mathematics, studied primarily by professional mathematicians. Much early work in algebra, as the Arabic origin of its name suggests, was done in the Near East, by mathematicians such as al-Khw?rizm? (780 – 850) and Omar Khayyam (1048–1131).[4][5]
Those damn muslims.
Same thing in USSR. Talented people turn to mental pursuits if they have little freedom in other areas. Notice that Russia entrepreneurs are going like gangbusters now that they get to keep some of the wealth they produce. Arabic scholars had few other areas to succeed in.
No, the Muslims didn't do that.
First of all, they imported the basics of Algebra from India where it was invented centuries before.
Second, when Algebra entered the Arabic world, Muslims didn't exist even and they wheren't dumbed down by their religiion.
It's when the Koran took over that during their internal wars, powergrabs where created and during the Crusades that coalitions needed to be made to attack the Christians. That coalition held a few centuries and reason was able to form. Then they broke down again and turned into what they are now. And when you look to what's going on right now, that doesn't seem to change anytime soon.
It's what ISIS tried to recreate. But instead of a coalition, the very people they counted on to join their side fled to Europe an that's ISIS actual defeat.
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Algebra did not always make use of the symbolism that is now ubiquitous in mathematics, rather, it went through three distinct stages. The stages in the development of symbolic algebra are roughly as follows:[1]
As important as the symbolism, or lack thereof, that was used in algebra was the degree of the equations that were used. Quadratic equations played an important role in early algebra; and throughout most of history, until the early modern period, all quadratic equations were classified as belonging to one of three categories.
where p and q are positive. This trichotomy comes about because quadratic equations of the form , with p and q positive, have no positive roots.[2]
In between the rhetorical and syncopated stages of symbolic algebra, a geometric constructive algebra was developed by classical Greek and Vedic Indian mathematicians in which algebraic equations were solved through geometry. For instance, an equation of the form was solved by finding the side of a square of area A.
Conceptual stages[edit]In addition to the three stages of expressing algebraic ideas, there were four conceptual stages in the development of algebra that occurred alongside the changes in expression. These four stages were as follows:[3]
I guess that the public school system doesn't teach that all Arabs are not Muslims.
Every christian who attacks muslims always leaves out the 'Dark Ages' for some strange reason.
Maybe they want them to come back?
cool. so what have they accomplished in the last 800 years?
"Most of you don't know what Algebra is."
Funny you should say that. I was just working on a second order nonhomogeneous linear differential equation. And to be honest, I'm struggling a bit. But one fragment, y" + y = sec x < x < pi/x, has a obvious and elegant solution. It's this: Jim Leyritz is an asshole.
And even in the "breadwinner jobs" category wages are falling, especially construction and IT, the first flooded by legal and illegal immigrants, the second mostly by legal and semi-legal "guest workers".
Outstanding post, should be kept pinned permanently.
H-1B, OPT, and L-1 visas have destroyed the tech sector.
It doesn't matter if the BLS numbers don't reflect the economy. What matters is that the algos are keyed to those fraudulent numbers and the entire MSM propaganda machine equates health of economy and prosperity to whatever the stock market is doing.
Its an exceptionally good con and it works on practically everybody. So, it continues, business as usual.
It works until it doesn't. I'm thinking next year. If the Fed owns everything then they own nothing. China didn't change because Nixon was a smooth talker. China changed because they saw that the Chinese Communist Party was running out of others people's money.
Should we call these "McJobs"? How about "ObamaJobs"?
How well are civil servants in the DC area paid? Is it a gig to which one's children should aspire?
Under nonpecuniary benefits, FBI agents get to wear neat body armor - at least they do on "the Blacklist".
Plantations created jobs. Guess we just need even more of them, then everything will be okay. All under same ownership. Sucks.
Targeting full employment without improving quality of jobs is a fools errand. We could have 100% employment and still be a poor country similiar to subsistance farming. You may be working but you are barely alive. Forward!
ZH has been fighting BTFD for 7 years, every ... single ... day. How's that working for you?
If the May high is broken being short might not be such a good idea and if the year closes at or near the high the farce could continue.
Well... unless theres a liquidity withdrawl (also known as a rate hike)...
Very good analysis and one you will never see on CNBC. May be too intellectual for Cramer
It's a damn shame that government employees sucking on other peoples money teat can't at the very least tell something close to truthful.
When they go home and pick up their check for showing up at the taxpayer paid office how many suffer to provide that? I imagine to them it might even be a bit humorous.
Well, like the snake that bit the frog after carrying him across the pond explaining,,, Well, that's the kind of SOB I am.
On what planet are the FIRE "jobs" bread-winning?
Bread-stealing maybe. Bread is made by manufacturing workers, not usurers.
Moving on:
Has anyone tried to break down any of these trends in overall and average hours worked by race, sex and place of birth? Because the breadwinner jobs are the jobs white native-born men used to do.
In the FIRE industries, white men still do the "work," if we must call it that. With very few exceptions the kings of the banksters are white men from "good" upper-class or upper-middle class families.
The long-term decline in white male labour force participation probably reflects the fact that the jobs white men of modest backgrounds used to go to to raise their families on have been systematically outsourced, automated or given to people with less of the wit and entrepreneurial spirit required to go into business for oneself after learning the ropes of the trade.
Rich white men see poor white men as the biggest threat to their dominance, a threat they are determined to remove at almost any price.
The bottom line is that the Criminal Banking Class-owned Federal Reserve System and Federal government policies have been destroying United States industrial capacity and jobs to enrich a very, very small group of obscenely rich oligarchs and crony capitalist corporate executives. The political parasites in both political parties implement these de-industrializing, America-destroying policies for a pittance in bribes.
The political parasite class has exempted themselves from laws pertaining to bribery by reclassifying bribes as honoraria, campaign contributions, payments for speeches, free rides on corporate jets, free trips to resorts for conventions, etc. The fact remains that they are still bribes. The toothless anti-government corruption watchdogs at the Justice Department, the Federal Bureau of Investigation, and others only investigate bribery when the President wants to bring down a politician for political purposes. That's a crime in itself. If the American People want to eliminate the massive corruption in American government they are going to have to take it upon themselves because the bribe-stuffed political parasites are not going to do anything about it.
It just goes to show what bs the globalisation argument really was. Just like the rest of the continuous bs that emanates from the members and wanna b’s (lapdogs), it’s all about contracting and thereby strengthening their now dot zero one bubble. Trickle Down? - my leg maybe.
What's interesting is that the various UN agendas bear a stunning similarity to the "Protocols of the Learned Elders of Zion" which was published toward the end of the 19th century.
Of course the Protocols are forgeries [sarc]. HAHAHAHAHAHAHAHA! Here's a link to get you started:
The Truth About the Protocols