Why This Job Market Is Still Terrible: The Politically Incorrect Numbers Everyone Is Hushing Up

Tyler Durden's picture

Submitted by Wolf Richter via WolfStreet.com,

For individuals, it has barely improved since the Great Recession.

If you have a salary well into the six figures, stock options, nearly free healthcare, and other benefits such as access to free gourmet lunches and dinners at the company’s food court, you might have missed something that a lot of folks feel every day: It’s still a very tough battle out there in this job market. And here is why.

Yesterday we got what was called a “stellar jobs report”: Non-farm payrolls rose 255,000 in July. In the other component of the report, the household survey showed that 420,000 new jobs were created. There are now a record 123.9 million full-time jobs. Government hiring was strong. Numerous sectors added to payrolls. And the unemployment rate remained stuck at 4.9%, with 7.8 million people deemed officially unemployed.

So everyone was happy. Well, certainly the stock market was. The S&P 500 closed at a new high. The Treasury market started worrying about a Fed rate hike, and the 10-year yield rose to 1.59%

But on an individual basis, on a per-capita basis – and this is what people feel when they’re looking for a job or asking for a raise – these “stellar” figures depict a job market that is only a little better than at the worst moment of the Great Recession.

US-population-2016-08-05

On its population clock, the Census Bureau estimates that the US population on August 5, 2016, at 4:49 p.m. ET (yup, down to the minute) was 324.17 million.

That’s up from 308.76 million in April 2010. Since the darkest days of the Great Recession, the US population has grown by 15.4 million.

The Census Bureau also estimates that there are currently 8.6 births per minute, minus 4.6 deaths per minute, plus 2 arriving immigrants (“net”) per minute, for a gain of nearly 6 folks per minute. Everyone ages, so the young ones move into the labor force, but the baby boomers are fit and healthy and don’t feel like retiring, and so they hang on to their jobs for as long as they can, despite the rampant age discrimination they face in many sectors, particularly in tech, though obviously not in politics.

In 2010, 24% of the people were under 18. That was 74 million people. Millions of them have since moved into the labor force, elbowing each other while scrambling for jobs, as have those millions who were then between 18 and their twenties and in college or grad school. These millennials have arrived on the job market in very large numbers.

In April 2010, there were 130.1 million nonfarm payrolls. In today’s July report, there were 144.4 million. Hence, 14.3 million jobs have been added to the economy over the time span, even as the total population has grown by 15.4 million. So that’s not working out very well.

On average, 205,300 jobs need to be created every month just to keep up with population growth and not allow the unemployment situation to get worse.

So clearly, for individuals who aren’t lucky, the employment math is very tough. The Bureau of Labor Statistics attempts to capture this dismal condition with its Employment-Population Ratio. It measures the proportion of employed persons to the civilian non-institutional population aged 16 years and over.

US-employment-population-ratio-2000_2016-07

The ratio always drops during recessions, but before 2001, it always climbed to higher highs during the recoveries. The 2001 recession and subsequent recovery changed this. For the first time, the ratio never fully recovered, never got even close to fully recovering. That was a new phenomenon: employment growth could no longer keep up with population growth.

When the Great Recession hit, the ratio plunged from its lower starting point at the fastest pace on record (going back to 1948). The Fed’s efforts were all focused exclusively on bailing out bondholders, re-inflating the stock market, re-inflating the housing market, and generally creating what had become the official Fed policy at the time, the Wealth Effect (here’s Bernanke himself explaining it). This has re-inflated asset prices – many of them way beyond their prior bubble peaks.

But the Fed’s astounding focus on capital accelerated the already changing dynamics of the economy, at the expense of labor.

Despite the re-appearance of millions of jobs since the depths of the Great Recession in 2010, the Employment-Population Ratio didn’t improve to any meaningful extent until 2014. In other words, over the first four years of the recovery, the number of jobs created barely kept up with the growth of the working-age population.

Then in 2014, employment growth picked up enough to grow faster than the population. But this too began to stall in March 2016, with the ratio at 59.9%. The ratio has since dropped to 59.7%.

In terms of total population: in April 2010, there were 2.37 people per job. Now there are 2.23 people per job – only marginally better. And this miserably inadequate improvement from the lowest levels of the Great Recession is what individuals are seeing.

It explains the dichotomy: Economists, officials, politicians, and central bankers point at the millions of jobs created since the Great Recession and at the official unemployment rate which has dropped to acceptable levels, while millions of individuals are mad as hell because they’ve not made it into the group of lucky ones, and they’re seeing a job market that is only slightly better – on a per-capita basis – than it was in April 2010.

And this is why the economy is so rotten to the core.

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Kirk2NCC1701's picture

Yes, Human 'robots'.  In sweat-shops in vassal-state countries across the globe.

Global wages are being leveled, exactly like water finding its own level.  Eventually, when the neo-Feudal Overlords have taken over the entire planet (via Banksters), they plan to reshape society according to their vision of "Sustainability".  I.e. Energy & Resource harvesting, distribution and consumption, Population growth, etc, will be all according to their vision of long-term sustainability.

IOW... they will also have to unleash a world religion, to match the world currency and world gov.  Oligarchs, sociopaths and banksters are all on board. Spooks, orders-loving cops and military types will happily salute and click their heels -- as in their DNA.  Opportunists and parasites will jump aboard also.

This has become a Battle of Civilizations -- against all Western civilizations (preferably via Divide & Conquer and militant Demographics).  It is a battle for the very soul of Humanity:  from local and regional loyalties and differentiation, to a global Hive.  Like the Borg, they will never back down.  They will appear to back off -- but only for tactical reasons, to regroup and attack again.  There is only ONE solution for Globalists.  We all know what that is:  their DNA goes, or ours does.  There is no Door 3.

Aristotle of Greece's picture
Aristotle of Greece (not verified) Kirk2NCC1701 Aug 7, 2016 1:18 AM

Too bad America is NEVER getting better. http://wp.me/p4OZ4v-3z

City_Of_Champyinz's picture

Trying to explain this simple math to an ignorant liberal sheep is damn near impossible.

joego1's picture

They don't mention the quality of the jobs nor do they sort part time vs full time jobs. That is why you see Trump and Sanders. People see through the bull shit.

MissCellany's picture

Nor do they mention how little jobs pay nowadays for the most part (especially in light of how much more everything costs today).

I guess the "median" wage is more or less steady, but if so, that's got to be because the top jobs, which already exist and are in short supply, are paying more and more.

All I know is, the only jobs open around here pay no more than $10 an hour with few or no benefits.

vote_libertarian_party's picture

They also don't mention retirement age people.  If the baby boomer bubble is pushing into retirement then the employment % number should be going down. 

 

I don't think it explains all of this but it is PART of it.

cynicalskeptic's picture

Older people keep working when they can.

Retirement is near impossible for those with 401K's instead of pensions.  Even if you max out continually you don't have enough unless you're saving another 10-15% of your earnings - which most people don't have.  

On top of that the new trend is to fire to high paid people in their 50's - most of whom are just starting to have'extra earnings' to put towards retirement - the kids are through college and the house is paid for (if you're lucky) but WHAM! - you're out of here.... without anything near enough to retire on and little prospects of earning what you used to.

I know a bunch of people let go after 30+ years with an employer - and others at JP Morgan Chaseand other places for the same mount of time who are training their replacements from India or wherever .  One guy has been out of work for 5 years and has run through everything - but astoundingly still hasn't tried to downsize or change his spending..... he owes the IRS a ton on his 401K withdrawls and seems screwed....????!??!?!?!   but he's not alone.

Social Security ios a joke now - they've understated inflation since the 1980's so you're getting half of what you should be paid - meanwhile they're upping the age to qualify (while Congresspeople get pensions no matter how short their tenure).

The proles are modern serfs.   Soon the Soylent Corp will be opening 'recycling centers' so people can check out early.

 

I don't know how this can keep going the way it is - unless there's no intention or expectation for it to keep going.   Given all the underground shelters built since the END of the Cold War and the militarization of ALL gov departments it seems like they're expecting some sort of massive event - either a meteor strike that makes a mess of the surface (the elites wait it all out underground) or wholesale rioting by the proles when the ponzi scheme collapses......

Glad I'm closer to the end of my life than the beginning.... my kids are really screwed.   God help them with the future they're getting.

 

 

whatamaroon's picture

I was laid off after 33 1/2 years due to outsourcing to China, Mexico South Korea etc..

AGuy's picture

"They don't mention the quality of the jobs nor do they sort part time vs full time jobs. That is why you see Trump and Sanders. People see through the bull shit."

People aren't "seeing through the BS". They are just experiencing financial problems and are angry. Sanders is a Communist, People follow him because the think more Gov't is the solution! People just want someone in Gov't to fix things for them. Well it not going to happen.

 Even if the best of all worlds candidate (not running/hypothetical candidate) won, He/she isn't going to fix $19+ Trillion in Federal Debt, or the $100+ Trillion in unfunded liabilities, over population, resource depletion, the demographics cliff, poor education, etc. Perhaps one crisis alone might be fixable, but we have close to a dozen different major crisises all converging together.

 The reason why all of the candidates running are crass, is because, anyone with any critical thinking skills understands the mountain of problems is unfixable. Its simply better to not get involved. The Candidates running are either on a ego trip (Trump) or addicted to power and control (Hilda beast).

 

Omen IV's picture

given that the majority of job additions were part time - the ratio of population to FULL TIME employment is much lower than at any time in recorded history - the truth is the job additions measure 10 hour per week jobs "the same" as 40 hours or full time job. As the avoidance of the 30 hour threshold became more a focus of policy in hiring to avoid obamacare requirements - countless jobs were converted to part time and the rotation has increased dramatically in the last three years as systems were put in place to manage all this.

Barack Peddling Fiction Obama and his BS at the Obama B.L.S. is now a whorehouse for statistics - UE Rate / Job Additions / GDP / Inflation Rate - all fake.

the job additions are either negative when measured on a 40 hour week or less than 50,000 a month.

The Witholding Taxes could be used to derive the truth - since that is an accounting exercise rather than a survey -  but I'm sure they are faking those published numbers as well

The Obama tools are touting this report heavy in the NYT by Irwin et al and other sites which means it is more than the usual promotion - Jack Welsh called the employment report on CNBC just before the election in 2012 as Wag the Dog contrivance (Clinton Famous phony bombing escapade in the 90's) -

they are at it again thru November

foxmuldar's picture

Minimum wage hike to $15 will find more workers being replaced by robots. The jobs report showed the avg hours worked at about 34. What happened to thhe 40 hour work week.

Not My Real Name's picture

Obamacare. That's what happened.

samsara's picture

324,000,000

TOO many people. I holding on hope for an EMP for a major reset.

lakecity55's picture

Georgia Guidestones.

The Time for the blood offering to Satan is close.

cynicalskeptic's picture

There are enough tin hat wearers saying that the elites plan on sacrificing most of us to their alien reptillian overlords.......They thrive on negative psychic energy and apparently aliens actually DO eat people.            

Makes you wonder if the X Files and shows like V are peeks at the truth... a subtle way of warning us.

All I know is that I no longer have any idea of what's really going on but it sure seems like we're entering 'End Times' in one form or another.   Not sure the planet will give us all that much more time.... peedictions of massive crop failures and food shortages by 2020 seem on target this time.  We're running low on water in lots of places and climate IS changing in many places in ways that affect growing crops.   

Not sure I would not have brought kids into this world if I saw all this on the way.

Mile High Perv's picture

Historically ... or rather ... mythologically speaking ... most of the ancient cultures in the world talk of a Great Flood that resets the planet

Anything else seems like a localized event that can be recovered from (probably exposing even more darker shades of humanity in the process)

Expat's picture

Who cares?  people not working are too stupid or lazy to get jobs.  These are all immigrant terrorists living on welfare.  Screw them.  Anyone without a job should have to join the army or leave the country. 

Ignore This's picture

Jobs and human labor no longer equal economic activity. As more jobs are replaced by robots and AI, less human labor is needed. This is a simple fact yet it is not accounted for in any of the economic indicators used by Zero Hedge or anyone else. At some point we will have close to zero employment yet everyone will still be able to take care of their daily needs. At that points the charts will show zeros yet in fact the true economy, based on actualy production, will be doing better than ever. This is why nothing has made sense to the editors at Zero Hedge for the past five years.

I Write Code's picture

Yes there is something to that, and that is why government printing may not be the disaster it looks like.  When all the widgets are made by robots and no human has a job, then helicopter money will be the answer, and it works and it's stable, or at least it could be in theory.  In practice, corruption will take more than reaches citizens.

lakecity55's picture

Those who control The Machines will have to eliminate 95% of humanity so they can live phat.

They are already planning for the nuclear war between Russia, the US, and China.

 

 

 

cynicalskeptic's picture

Explains all the deep underground bunkers.....    You really do get the feeling that they don't care about what the end game is as long as TPTB survive.  They figure ther are fewer to share with if they kill off most of the world's population.

Problem is it's not the best and brightest that survive - only the socopaths with no moral compass willing to do anything for any reason.

lakecity55's picture

Not to worry. The War Clinton will launch for her Controllers will reduce the world population to only a few million people.

After the Nuclear Winter ends, we should be down to a few hundred thousand.

Green shoots!

root superuser's picture

Goods and services require energy to be produced. Automation and AI output is zero without energy. Currently 80% energy comes from non-renewable resources. Current level of goods and services being produced is unsustainable in long term and no amount of AI and automation will fix that.

Itinerant's picture

Unsustainable. True, unless we harness renewable energy, thorium nuclear cycle for the short term. Even with the energy problem resolved, there are too many other unsustainable inputs at current, let alone future population levels. Assuming we do not commit suicide with nuclear weapons or climate change before then.

Itinerant's picture

we will have close to zero employment yet everyone will still be able to take care of their daily needs

More likely they won't be able to take care of their daily needs, with a huge fall off in demand and production. How are these people supposed to buy stuff without employment? The political culture of the day is still pedal to the medal on the idea that these people need to be punished so they have incentives to find work, or in the liberal version, retrained and better educated. I am seeing a lot of chicklet vendors and cheap hookers in our future.

cluelessminion's picture

There are jobs out there but they don't pay very much.  2 kids.  One with a lib arts degree from a respected liberal arts college.  She was able to get a job teaching math to 4th and 5th graders at a charter school.  Makes about 30k a year with moderately expensive health insurance.  Can afford an efficiency apartment but happy because it beats living with me. Other one a knuckleheaded HS grad still living at home.  Nothing but warehouse and "landscaping" jobs where he gets 10 (11 if lucky) an hour while being treated like sh!t by management who sees him as throwaway labor.  No bennies, no regular raises, no future.  Thrilled because he just got hired for 12 an hour.  He will probably be her for a while;  I guess it beats having to buy your own food and pay bills.  He does pay for his car and phone.  When he can.

 

Neither of these kids have the future I did at his age.  If you don't work for the public schools you don't get the pay and benefits to pay for a middle class life so kid #1 is going be stuck at working class wages and low benefit levels.  Kid #2 is already angry; hard to get dates with no money and he's tired of getting dirty and sick (warehouses are NOT healthy) for 10 bucks an hour less taxes.  He's thought about trade school but doesn't have the money, plus no garrauntee of a job afterwards.  This is the reality of young people in the work force: limited options, limited money, treated with less than total respect becasue there are so many out there.

 

But I hear it's much worse for older workers in the job market.

I Write Code's picture

>But I hear it's much worse for older workers in the job market.

Seems to be a mixed bag.  Actually it seems experienced oldsters (too) often get preference over millennials as long as they're willing to take the pay cut.

lakecity55's picture

Our Overlords have not yet succeeded in reducing all of us to abject Poverty, but just give them a bit more time.

 

 

Muppet's picture

Consider having him start a biz swapping commerical 4' flouresent tubes with LED replacement tubes.  Lowers electric, heat, longer life, brighter light.  At $1 profit a bulb, he could do well and learn a lot. 

Beltain's picture

Funny how many families I see int he same scenario. Daughter gets to go to college and makes barely enough through some form of an educational position (even private schools are basically publicly funded) while the sons languish at their parents unable to find anything but manual labor type positions. Bet you're a white family too aren't ya.

 

Seeing a pattern here....

 

I Write Code's picture

Plus the quality of the jobs is way, way down, lot of people dumped out of $100k jobs end up working for $60k or $40k and it looks great as a statistic even though it's really a 50% hit.

Consuelo's picture

 

 

 It ain't real unless an overlay of monetary interventions since (at least) the year 2000 are factored in.   Much like the now-popular S&P/QE overlay and the inescapable manner in which the two are joined at the hip, this 'job' situation didn't just happen or 'evolve' on market conditions alone.   

 

The Duke of New York A No.1's picture

Sit back and enjoy the "Hillary Rally" in the stock market ... it should last until end of market close on Nov 8, 2016.

yogibear's picture

That's the Fed's and Wall Street's plan.

Probability is probably close to 90%.

Even though money velocity is nothing like 2000, you have the gov stats, Fed buying stocks and Wall Street looking at the juicy year-end bonuses.

Fisherman Blue's picture

Fuck it I am long gold (short government) and no matter what gold will be phat.

lakecity55's picture

Every single statistic issued by the USG is completely False.

coast's picture

bugs: duck season...daffy: wabbit season...bugs: duck season ....daffy: wabbit season....bugs: wabbit season....daffy: duck season....oops :-)

BocceBaal's picture

This article is a little misleading because the population is aging. The employment-population ratio is all people 16 and over.

For a better comparison, look at the the same numbers for people aged 25-54. That metric is only down about 2% since 2008, not 3%.

Baron von Bud's picture

Electrical engineer graduates have poor job prospects with young workers only getting hired via attrition. Computer programming jobs expected to decline by 18% through 2020. So much for high paid technical work. Trump is right. When factories get offshored to China the high paid workers lose their jobs. The government works for the corporations not the people.

yogibear's picture

I know a company that has nearly 90% of it's employees from India (H1Bs). Many companies like that now. Why hire American grads when you can get overseas grads for less?

Plus the government doesn't enforce anything anymore. So flooding of H1Bs into the job market is the norm.

cynicalskeptic's picture

H1B's for high end jobs.  Illegals for low end.  A growing economy might support immigration for woerk.  But the US is CONTRACTING - not like the good old days when labor was hard to find.  That's why you had the Irish and Chinese building railroads.

deja's picture

It's a huge scam.  Those Indian employment agencies call up people working similar positions they want to fill to offer them work for ridiculously low salaries.  Then, they go back and say they couldn't find any exisiting citizens to fill the jobs. 

cynicalskeptic's picture

'Free trade' destroyed the jobs base in western countries.  Some like Perot saw it coming. 

Hillary gets in and the TPP and worse will finish off what's left of the working class.    The parasites are killing the host worldwide with an endless pursuit of the cheapest possible labor costs under the worst conditions.  Now cheap capital is encouraging the robot replacement of labor.

DrBrown's picture

Retired early to return to school and finish degree in electrical engineering. No one will hire me. Not a chance in hell. So much for John Kasich's bullshit statement that older workers should just go back to school to get a new career. It's a lie. In fact the government work force development people told me no one hires older workers but hardware stores, kmart and the like. More fucking lies from these political pieces of shit!

Swamidon's picture

For some the mid-life career change is used to change the quality of their life.   Actually to start anew and have a second chance at a more rewarding existence, not to continue struggling with the old one.