US Job Market Not As Strong As Perceived, San Fran Fed Warns

Tyler Durden's picture

Despite endless streams of Fed Speakers proclaiming, in one form or another, that "we are at, or close to, full employment;" many in America - judging by the election of President Trump - are not feeling as exuberant as the jobs data implies they should be. The SF Fed itself now agrees: "the labor market may not be quite as tight as the headline unemployment rate suggests."

As we detailed previously, between 1948 and 2015, the work rate for U.S. men twenty and older fell from 85.8 percent to 68.2 percent. Thus the proportion of American men twenty and older without paid work more than doubled, from 14 percent to almost 32 percent. Recent data over the last number of years have begun to show that it is not just the American male who is struggling.

The participation rate of female workers is beginning to decline as well. The trend in the workplace has not been our friend.

And The San Franciso's Fed researchers Regis Barnichon and Geert Mesters question "how tight is the US labor market?"

The current low unemployment rate compared with previous labor market peaks has raised some fears regarding whether the labor market has become too tight. In this Letter, we use a new method to isolate the effects of demographic changes on unemployment, and we find that the demographic-adjusted unemployment rate is still 0.3 to 0.4 percentage point higher than it was at past labor market peaks.



This indicates that the labor market may not be quite as tight as the headline unemployment rate suggests.

The researchers note that there is a major demographic effect in this...

As of February 2017 the shift-share adjusted rate stands at 5.0%—the same level as in the 1979 and 1989 labor market peaks (green line) and only one-tenth higher than the 2006 peak—which appears to confirm the initial impression of a tight labor market.


However, we believe this conclusion is premature. We find that the standard approach to demographic adjustment does not properly capture the full effects of demographic changes. In fact, once we address the shortcomings of the standard approach, the demographic-adjusted unemployment rate appears to be higher than all its previous lows since 1976.


Taking a longer-run perspective, we consider the effects of demographics on unemployment since the mid-1970s and their underlying causes. Figure 2 shows that demographic factors lowered the unemployment rate by about 2 percentage points over this period, according to our adjustment method. This number is substantially larger than that implied by a conventional shift-share analysis, which suggests demographics lowered unemployment by just over 1 percentage point.


So, in other words, if Yellen ever needs an excuse to get dovish, her own SF Fed research department just offered up PhD-style proof that the economy is not as strong as everyone hopes for... due to demographics.

*  *  *

Furthermore, any reasonable analysis suggests that in the future, the rate at which jobs are being lost to new technologies is only going to double and triple. This is one of the central problems facing society today, not just in the US but all across the developed world.

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HRH Feant's picture
HRH Feant (not verified) Mar 20, 2017 8:05 PM

I think I see a divergence between charts and reality.

John Law Lives's picture

If enough ZH regulars will invest a few moments to contact  and report this spammer, xythras, I believe they will do something about this.

xythras, you can fvck off. 

john doeberg's picture

John, how old are you? Stop publishing that email, will only get them spam by making it visible to bots and search engines. 

And I'm willing to bet ZH doesn't care about linking in the comments, since there are tons of user doing it. 

Just get over yourself and enjoy ZH. 


John Law Lives's picture

I have been a member of this site for 6+ years longer than you.  Keep your opinion to yourself.

xythras is a spamming idiot.  There was a time when ZH administrator(s) would rectify such issues.

xythras's picture
xythras (not verified) John Law Lives Mar 20, 2017 9:43 PM


East European ZH owners don't give a rat's ass about your input.


Now behave. 

Dyler_Turden's picture

Dude, you're gonna give yourself a heart attack.

Turning into a troll to fight trolls won't help you. They are just having fun at your expense old man. 6+ years on ZH and you haven't learn anything.

Btw, never go to 4chan , you'll definitelly get a heart attack then if you don't get one today.

- just my 2 cents-

John Law Lives's picture

Keep your 3-week-member opinion to yourself, newbie.  ZH was a great forum that once got rid of spammers.

Dyler_Turden's picture

I'm pretty sure I've been around the Internet block more times than you pa'. By saying "newbie" instead of noob I see you're an old fart.

Don't live in the past, new ZH owners know what they're doing.. they increase traffic by having people arguing and "fighting". PC webs that censor comments and free speech are dying and losing customers, because there's no flavor in just eating what they feed you without havind some "fun" on the side.

I don't know where you've been in the last 20 years or so, but definitelly not MUCH ON THE WWW. 



John Law Lives's picture

"I'm pretty sure I've been around the Internet block more times than you pa'...." - Dyler

This is pure dross.  Allowing rampant spamming on this forum does not add value to the forum.  The value of ZH to the members here is its content, and xythras is not adding value to that.  ZH will indeed care if/when enough members get turned off and find another forum.  If they allow more and more spammers like xythras to proliferate here, this forum will turn to excrement.  That would be a shame.  

john doeberg's picture

What are you adding granpa?

Just complaining that the days of yore are gone and picking on the new ones. Hilarious.

You're living in the Gran Torino movie but you're no Eastwood pops. 

John Law Lives's picture

john, you are out of your depth.  You haven't made one insightful comment on this thread.

Deathrips's picture

We could just give this bitch all the attention he needs. Full comments sections of fuck of spammer till tylers get the point.

This dumbfuck clogs the thinking here with statism.





MortimerDuke's picture

No, I've considered both "newbie" and "noob" for you, pledge.  Thought long and hard on it.  You're a newbie.  

Peak Finance's picture

This Daily westerner guy is ok

The biblicism institute dosent boher me either

those shepwave fuckers, now those guys gotta go

John Law Lives's picture

xythras is a spamming dildo who (obviously) upvotes his/her own garbage spam posts via multiple ids.

john doeberg's picture

Maybe you're a bit paranoid. I have to admit, I enjoy some of the articles he's throwing in here, and I'm sure I'm not the only one. 

Now you'll say I'm another account of xy. But rest assured many ZH users might visit links shared around and upvote the messenger, even if he/she is spamming. 

You just started to hold a grudge for talking shit to you. Trolling goes both ways, you know.

Have a nice day.


John Law Lives's picture

"You just started to hold a grudge for talking shit to you." john

Excrement.  I object to mindless spamming from any source on this forum.  Plenty of people have objected to xythras' spamming.  Some of us members have been here a long time and place great value upon this forum.  We don't want to see it ruined by spammers.  If the administrator(s) of ZH really don't give a damn any longer, don't expect this forum to maintain any level of quality.  That would be a shame.

john doeberg's picture

You lost your argument over there on the 2nd sentence.

Get a bit more worked up and you'll behave like those Antifa. Are you a commie John? Or do you still have flashbacks from Nam, John? Do you?

Insanity might creep in with old age, make sure you keep your head clear. And hydrate !!!

Best wishes, 


John Law Lives's picture

Dream on, simpleton.  You did not offer any defeaters to my observations.  

Bernie Madolf's picture

Don't worry the impending layoffs when 3m hits 1.5% with 10 yr at 2% will tighten the labor market. There may be a spike in unemployment but that is noisy and transitory.

MuffDiver69's picture

So much economic data is outdated. I'm almost fifty and hardly any women worked when I was a kid. We had almost no illegal aliens working and you could find any job to at least have some cash until you found better work...How the hell are you going to compare that to today...I'm willing to bet 20% of the people holding jobs in this country aren't even citizens and we didn't have anywhere near the welfare dependency fifty years ago with single mothers and all the disability garbage...Of course numbers are bullshit when they are using a model that doesn't exist anymore...We are headed for the Italian model where almost as many work under the table as pay taxes..

Arrow4Truth's picture

Haven't paid taxes in 10 years. Just can't get past the fact that if I was tithing, the "church" wouldn't be using it to assist those in need, but instead would be using it to control more of the world. Spot-on regarding the antiquated numbers model. Be assured, it's gonna get a lot worse before it gets any better. Cheers.

LawsofPhysics's picture

I thought Obama said that we were back to "full employment"?

Arrow4Truth's picture

The Kenyan said a lot of things... none of which were true. It's all just a matter of perception. No?

Sledge-hammer's picture
Sledge-hammer (not verified) Mar 20, 2017 8:39 PM

Of course, the job market is not strong.  Millions of jobs are still off-shored.  Employers are still under pressure from the last 20 years of a sh*tty economy.  Red tape, regulations, and corruptocracy are still in place.  Jobs that are available are at will, temporary, minimum wage, AA set asides, HB-1 or illegal alien filled, or age dependent (No one over 40 or 50 need apply).  Duh.

Peak Finance's picture

These fuckers

right on time, Trump in office, stop rigging the numbers

a blind man can see through this shit

swampmanlives's picture

Then why was Trump proud of the 4.7% unemployment rate and seemingly dropped the rigged numbers narrative?

CJgipper's picture

I just saw a job for an entry level guy, 5 years experience required.  Seriously.


shamus001's picture

I work in the Maritime Industry; Back in 2014 when oil began plummeting, the work dried up in the Gulf of Mexico... no oil being drilled... no oil REALLY being consumed, because INDUSTRIAL PRODUCTION has crashed!  Well, NEXT one would think to see the signs in "Transportation of Goods" TANK-  Well... they did in GLOBAL TRADE, with Singapore ports being overwhelmed with cargo ships that have no goods to move. ( this happened BEFORE THE OIL PRICE TANKED):


Global trade sputters to a 5-8% dead slow.  No demand lowers demand for fuel; Fuel prices follow crashing in demand and price, a few years continue, and no increase, well I just got laid off last Jan. from transporting goods LOCALLY IN THE U.S.!   As a Chief Engineer, I am in high demand, but when I am laid off, it usually happens 2-3 months after the stock market collapses.

NATIONAL GOODS PRODUCTION & DEMAND LOCALLY HAVE SPUTTERED.  They may get a summer reprieve, but this suffocation is the beginning signs of another STOCK MARKET CRASH, followed by DEEP DEEP commercial suffering.  Next will be lay-offs to compensate for weak sales, followed by stock shorting, lower sales, more layoffs UNTIL THE PEOPLE ARE MADE FINANCIALLY WHOLE.

This Fiat game has reached its APEX. So has the global markets.  A global depression is cooked in the books, it's already begun and there's no way to stop it thats politically viable.  National Protectionism is the next logical step to stem the bleeding locally.  Those in weaker circumstances will become hell holes!

CJgipper's picture

Of course there's a politically viable way to stop it. At least in the us - hyperinflation. 

JailBanksters's picture

It looks like what we got here is a Failure to com-unicate

None of these FEDS talk to one another do they.

They just live in their own Ivory Towers and don't have any Idea what happens outside their own office and don't really care for that matter.



Sledge-hammer's picture
Sledge-hammer (not verified) Mar 21, 2017 12:42 AM

Darn it ZH, there is another underwear banner ad on this post.  This ad has a red-head Caucasian female paired-up with some tatted-up beaner.  There was another ad on another post that had a blond female paired with a black buck.  Is ZH promoting miscegenation? 

swampmanlives's picture

Explains why the Trump winery is looking to hire more foreign workers from the H-2A program. To apply for it, employers must say that you have not been able to find American workers. I guess the Trump team couldn't find any Americans willing to pick grapes for $10.72 an hour.