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Guest Post: Our "Let's Pretend" Economy: Let's Pretend "Job Growth Is Best Since 2006"

Tyler Durden's picture




 

Submitted by Charles Hugh Smith from Of Two Minds

Our "Let's Pretend" Economy: Let's Pretend "Job Growth Is Best Since 2006"

Instead of just swallowing Ministry of Propaganda swill, let's examine actual data. If we do that, we find job growth is mostly smoke and mirrors.

The Ministry of Propaganda and its media minions are announcing that "job growth is on a tear" and the "best growth since 2006." How about we look under the hood of the employment euphoria? Here is an example of the Ministry's work: Best U.S. employment growth in 12 years Almost all the data agree — labor market’s on a tear.

Over the past six months, the number of people who are employed has risen by 2.3 million — an average of 385,000 per month. That’s the best growth since early 2000, when the dot-com bubble was in full flower.

 

Since August, the unemployment rate has fallen by 0.8 of a percentage points, to 8.3%. For adults over 25, the jobless rate has fallen to 7%.

In other words, people who generally work full time so they don't have to share a bunk in a flop house or live in their parents' basement are almost fully employed, as 'full employment" typically generates an unemployment rate of 5% just due to churn.

Best since 2000. Oh really? Let's look at the data as presented by the St. Louis Federal Reserve (FRED). Let's start with a measure of the workforce, what the Feds politely call the non-institutional population. Note that it rose by 33 million since 2000:

 

 

Meanwhile, back in reality, the number of jobs (full-time, part-time, temp, etc.) rose by 4 million since 2000:

 

 

Even more telling is the number of full-time jobs--the kind you can actually live on-- which "skyrocketed" back to the number of jobs in 2000, around 115 million. As Zero Hedge reported, the number of part-time jobs (and recall that can mean 2 hours a week or 20 hours a week) has skyrocketed to 28 million. If you haven't tried living on a part-time gig in America, I recommend it for an "on the ground" taste of the "best job growth since 2000." The Part-Time Economy (Redux).

 

 

How do you add 33 million people to the workforce while the number of full-time jobs hasn't budged in 12 years and claim "job growth is on a tear"? First you arbitrarily subtract 20 million people from the workforce. Call them "discouraged" or "marginally attached," whatever, just don't call them what they really are which is jobless.

 



 

Another way to view reality rather than spin is to look at the civilian-population employment ratio, a measure of what percentage of the populace has a job of some sort: Here we see that it is back to the recessionary levels of the early 1980s. For 64.5% of the populace to have some sort of job as in 2000, we would need an additional 14.5 million jobs. That's about 6 years of 200,000 jobs added a month, but then the workforce will rise by between 12 and 17 million in those years so you better add 400,000 jobs a month if you want the participation rate back to 2000 levels.

 



 

If "job growth is on a tear" you'd expect real incomes (adjusted for inflation) to be on a tear, too--but then you'd be wrong, as real income is declining:

 



 

According to Conference Board data, those actually seeking work are reporting jobs are hard to get--numbers that are at recessionary levels.

 



 

Scroll back through the charts; honestly, is this a "job market on a tear"? Real earnings are falling and the number of jobs you can actually live on remains stuck at 115 million--all the "added jobs" are marginal: marginal hours worked, marginal security (temp), marginal pay (part-time=low pay and no benefits).

Would we as a nation be better off dealing with the truth rather than believing fantasies that prop up the Status Quo and the Fed's dearly beloved measure of the economy, the stock market? How often does accepting illusion help us navigate real life? Short answer: never.

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Fri, 03/09/2012 - 15:15 | 2240595 FoolsAdvice
FoolsAdvice's picture

Let's pretend this party's started.

 

Bitchez!

Fri, 03/09/2012 - 15:19 | 2240622 Michael
Michael's picture

Literally, brain damaged lunatics run my country.

Fri, 03/09/2012 - 15:31 | 2240673 LongSoupLine
LongSoupLine's picture

 

 

This is simply about power, election cycles and those who will do anything to protect their dominance of both.

Fri, 03/09/2012 - 15:33 | 2240685 Moneyswirth
Moneyswirth's picture

Yes, yes and yes....

Fri, 03/09/2012 - 15:48 | 2240758 Michael
Michael's picture

I think black unemployment needs to go from 16% to 25% for the deity Obama to be dethroned.

Fri, 03/09/2012 - 16:04 | 2240900 Thamesford
Thamesford's picture

now if they renamed the originating organization as the

Bureau of

Idealized

Labor

gratuitously

Enhanced

Statistics

we might find the acronmym more fitting!

 

Fri, 03/09/2012 - 16:07 | 2240932 Winston Churchill
Winston Churchill's picture

Bullshit,Lies and shams.

Sat, 03/10/2012 - 03:10 | 2242720 Kobe Beef
Kobe Beef's picture

..brought to you by Uncle Scam and the Bloodsucking Lobbies.

 

Fri, 03/09/2012 - 17:22 | 2241371 boogerbently
boogerbently's picture

If the GOP is "bought and paid for" by corporate America, why haven't they established written and broadcast news outlets to do some "brainwashing" of their own?

All we ever get is the liberal SPIN.

Fri, 03/09/2012 - 19:54 | 2241825 Harbanger
Harbanger's picture

The MSM is and has been the propaganda wing of the Democrat party for decades.  Just that now it's becoming blatantly obvious. 

Sat, 03/10/2012 - 00:17 | 2242465 jeff montanye
jeff montanye's picture

the realization is crystallized by the obviousness that the democrats are decidedly illiberal.  obama is bush except around the sex parts (abortion and homosexuality).

Fri, 03/09/2012 - 16:10 | 2240955 LasVegasDave
LasVegasDave's picture

brain damaged cocksuckers like you get the leaders you deserve

Fri, 03/09/2012 - 15:36 | 2240700 billyretweets
Fri, 03/09/2012 - 16:22 | 2240930 tempo
tempo's picture

The ultimate plan for a smart highschool graduate. Plan for a minimum 5 year under graduate degree fully financed by student aid and food stamps. Delay default for few years then go back to school for a 3 year worthless masters. Now you are about 30 years old. Go on food stamps, section 8 housing, and medicaid. Live w 3 or 4 other entitlement masters. Threaten to move back home so your parents will start paying your 4g cell phone bill and cosign for another 3 year degree. Protest and blog endlessly about the abusive society and bitch about your materialist christian parents. Be green and a progressive. Volunteer for only the super liberals.  Buy every new AAPL product on the release date, facebook and twitter endlessly.  Bad mouth the man.

Sat, 03/10/2012 - 00:07 | 2242443 Problem Is
Problem Is's picture

Or....

Accept the reality of your down sized life due to the resources sucking, scorched earth left behind by your narcissistic baby boomer parents and...

Get to work...

Plowing Fields--Stocking Shelves
In physical labor in the productive economy...

Sat, 03/10/2012 - 03:18 | 2242727 Kobe Beef
Kobe Beef's picture

Or sell whatever services you can provide now for cash. Turn cash into PMs. When you have enough, leave the USSA.

brain drain, bitchez.

Sat, 03/10/2012 - 10:47 | 2242989 debtandtaxes
debtandtaxes's picture

You first....

Sat, 03/10/2012 - 00:25 | 2242481 jeff montanye
jeff montanye's picture

well if they have to volunteer for only the super liberals they ought to have some serious time on their hands.

Sat, 03/10/2012 - 07:32 | 2242845 The Alarmist
The Alarmist's picture

Actually, with that first Masters in your pocket, you should apply for a federal government job ... Pretend to work and ride the gravy-train for the rest of your life.

Fri, 03/09/2012 - 15:15 | 2240596 Ahmeexnal
Ahmeexnal's picture

iPad eXtreme is sold out in the US and Canada.
AAPL rises to new levels.

Seems like the BoI knew what it was doing.
Now they must time when to sell all that AAPL stock.

Fri, 03/09/2012 - 15:20 | 2240614 SheepDog-One
SheepDog-One's picture

Yep, because who out there even has the money to buy a $550 stock when they decide to sell it? There are no real buyers out there to dump to. 

Sat, 03/10/2012 - 04:56 | 2242782 Vendetta
Vendetta's picture

details, details ...

Fri, 03/09/2012 - 15:19 | 2240619 SheepDog-One
SheepDog-One's picture

Well come get me then, bitchez...they want to kill US citizens lets see them try it.

Fri, 03/09/2012 - 15:24 | 2240608 SheepDog-One
SheepDog-One's picture

We're supposed to believe part time min wage jobs match up to the early 2,000's where any jackass could easily get a $20/hour job in construction, or finance gigs were a dime a dozen to anyone who could write? 

Remove JUST the 0% interest and put it back to historical very low 2% and see what happens to your precious little data!.

Fri, 03/09/2012 - 20:12 | 2241877 UP Forester
UP Forester's picture

It's so much better now than 30 years ago.  Back when the father worked a job, the mother worked the kids.

Or 50 years ago, when the father could work at a gas station and support the whole family.

Can't wait until this whole house-of-cards-built-on-quicksand collapses and gets sucked down.

Rebuilding will be fun.

Sat, 03/10/2012 - 11:59 | 2243067 Kobe Beef
Kobe Beef's picture

No way Forester! Our Marxist utopia requires the State to raise the kids! And those pesky fathers are best kicked out of the home altogether.

/sarc off.

No Fault divorce, Cash for Bastards, Dep't of (mis)Education, Head Start & all those other lovely welfare programs are NOT an accident. Nor the result of benevolent intentions. The Frankfurt School's Critical Theory first sought to identify the pillars of Western Civilization. Judicial & Bureacratic Activism has since sought to destroy it. The American Family has been marked for destruction.

Sat, 03/10/2012 - 00:12 | 2242448 Problem Is
Problem Is's picture

Yes.

Believe, oh disgruntled one...

Drink Up, Bitch!
Green Shoots Lime Kool-Aid for the SheepDog...

Fri, 03/09/2012 - 15:20 | 2240624 CrashisOptimistic
CrashisOptimistic's picture

Meaningless gobbledygook.

The parameter that matters was released yesterday.  All time high budget deficit for the month.

Now let's be sure we understand that.  We have a spending CUT this year of $4B in FY 2012 from the debt ceiling deal.  Spending is not UP.  It's down a tiny bit.  

The payroll tax cut extension was an extension so that's neutral on tax revenue.

So how did we get a all time budget deficit record if spending is down this year and more people are working and paying taxes?

Answer: they are not

Fri, 03/09/2012 - 16:12 | 2240973 I only kill chi...
I only kill chickens and wheat's picture

Ahh, but I was hired today by the infernal repo service for 60 days min. Come to me you .gov teat.

Sat, 03/10/2012 - 00:14 | 2242456 Problem Is
Problem Is's picture

.gov Welfare Teat

Is that you, senile Uncle Warren Buffett???

Fri, 03/09/2012 - 15:20 | 2240625 besodemuerte
besodemuerte's picture

Oh do I love this "let's pretend" series.  Thank you.

 

Bullish for the markets, ofc.

Fri, 03/09/2012 - 15:22 | 2240636 DavidC
DavidC's picture

This is one of the things that keeps me trying with this 'market'. When it blows, and it will, it's going to be something to behold. The powers-that-be can hedonically adjust, seasonally adjust, manipulate or lie as much as they want to but they CANNOT change the truth and the actuality. And that will dominate at some point.

DavidC

Fri, 03/09/2012 - 15:23 | 2240637 Bull Bear Otter
Bull Bear Otter's picture

BLS says "Hey, look at my thumb...  *WHACK*  Gee your dumb!"  But if the majority of the sheeple keep faling for it, why not?

 

Fri, 03/09/2012 - 19:20 | 2241739 Totentänzerlied
Totentänzerlied's picture

If you are referring to the non-investing public - as in damn near just about everyone in America - they have no idea what NFP is or what it means or what it printed at today or ever and they have never heard of the BLS either. They know what their preferred cable news channel tells them about the "jobs picture" - how Obamessiah continues his valiant struggle to "create jobs".

The majority of the investing public know only what the paid-to-lie assclowns on CNBC tell them. Green arrow good, red arrow bad.

The BLS can report any number it damn well pleases and on a good day perhaps 5% of Americans would notice, and of them 75% would believe it.

This applies to virtually all macroeconomic indicators and market indices with the exception of the DJIA, S&P, and NASDAQ. The level of willful economic ignorance is practiclaly inconceivable.

Fri, 03/09/2012 - 20:00 | 2241851 blunderdog
blunderdog's picture

  If you are referring to the non-investing public - as in damn near just about everyone in America - they have no idea what NFP is or what it means or what it printed at today or ever and they have never heard of the BLS either. They know what their preferred cable news channel tells them about the "jobs picture" - how Obamessiah continues his valiant struggle to "create jobs".

The majority of the public knows full-well it's "all bullshit all the time" from the government.  They may know very little about what's going on in the world, and pay little attention to the content of speeches and such, but they are mostly quite aware that they're being lied to constantly.

The people who tend to be fooled by the bullshit are the educated and affluent.  It doesn't matter whether they consider themselves Dem/'pub, or lib/con, or moderate or independent.

The thing is--news media outlets tailor most of their messaging for that rather small population of "well-educated and affluent."  That's how media companies make their money.

It's very easy to be misled about what "the public" thinks about ANYTHING.

The most commonly repeated complaint here, about stupid people believing whatever they're told, is way wrong.  Most people don't believe ANYTHING.  They aren't angry because they're busy focusing on the things in their lives that they care about.

That's not stupid.  That's often a wise decision--ignorance makes more sense for anyone who'd rather be happy than informed.

Sat, 03/10/2012 - 00:41 | 2242508 jeff montanye
jeff montanye's picture

both you and tot above are right.

although the mass of people know the fix is in and the good guys lost (even if the war isn't over http://www.youtube.com/watch?v=Oq0KxzLMNx4), it still amazes me how much the average person knows about spectator sports and reality television and how little about economic history and portfolio management, especially considering the upside and downside of knowledge/ignorance in each.

Fri, 03/09/2012 - 15:23 | 2240639 Atomizer
Atomizer's picture

Based on todays jobs report numbers, we'll manage to reach those employment goals by 2084.

Fri, 03/09/2012 - 15:24 | 2240642 alexwest
alexwest's picture

v..vv..v good

only chart missing is FOOD STAMPS CHART..
its been on tear too for last 4 years..

alx

Fri, 03/09/2012 - 15:25 | 2240643 resurger
resurger's picture

if the markets did not rally today on the Greek Deal & the fake Job growth, then when will it rally?

 

Expect it to dive next week... 100%

Fri, 03/09/2012 - 15:33 | 2240686 DavidC
DavidC's picture

Uh? The markets DID rally. What are you on about?

DavidC

Fri, 03/09/2012 - 15:25 | 2240646 realtick
realtick's picture

The annual percent change of nonfarm payrolls has peaked at a lower level than the previous "expansion":

http://chart.ly/fgqsbjy

 

Fri, 03/09/2012 - 15:28 | 2240664 Alex Kintner
Alex Kintner's picture

Thank Gawd. My job wasn't really sent to India. I'm  just a discouraged individual. Feel much better now.

Will XXX for Food.  (you fill in the blank because I don't really care anymore.)

Sat, 03/10/2012 - 00:18 | 2242464 Problem Is
Problem Is's picture

<BLANK>

Will vote for the Useful Idiot Barry Soetoro for food...

No wait... Diebold already took that job from you...

Fri, 03/09/2012 - 15:30 | 2240671 monopoly
monopoly's picture

Look, I agree with this post, I see it all around me. But, until it is noticed, acted upon and found out by the people it just does not matter. This damn spoos is 5 pts. off its high. What a bunch of crap. And am sure glad I do not trade this farce.

Just more reasons why physical is the place to be.

Fri, 03/09/2012 - 15:46 | 2240672 ebworthen
ebworthen's picture

Let's pretend getting basic healthcare isn't bankrupting people.

Let's pretend people aren't living in homes they are not making mortgage payments on their underwater Fannie/Freddie ATM.

Let's pretend our leaders on both sides of the aisle have a clue and give a shit.

Let's pretend 46 million people aren't on food stamps.

Let's pretend we aren't telling the biggest lie ever told by telling our younger generations that if they go into debt to "get a degree" it is more than a piece of paper at a diploma mill to perpetuate selected ideologies and maintain the academic aristocracy.

Let's pretend that the value of citizenship and the rule of law haven't been executed and their heads put on pikes at the NYSE and the FED.

Let's pretend that bailouts are o.k. for irresponsible banks and corporations yet verboten for responsible individuals and households.

Let's pretend that $5 gas doesn't matter this time because of the $20 a month "tax break" and the "recovering economy" (heard on CNBC this afternoon).

Let's pretend that milk is $1.75 a gallon, eggs are .69 cents a dozen, and that ice cream actually comes in 1/2 gallon containers.

Let's pretend that the Kleptoligarchy of Frankenstein business and his white wavy-streaked hair Bride of Frankenstein Government and Judiciary care about our right to property, speech, self-defense, and liberty.

Personally I'm out of pretend, but the MSM, the sheeple, and our Idiocracy isn't and the droogs are busy washing down Soma tablets with chugs of milk-plus.

They are all Mad Hatters and March Hares.

"A Clockwork Orange" meets "Brave New World" meets "Alice in Wonderland".

Fri, 03/09/2012 - 16:01 | 2240880 Al Huxley
Al Huxley's picture

Brave New World for the complacent and obedient, 1984 for the trouble makers.

Sat, 03/10/2012 - 00:21 | 2242471 Problem Is
Problem Is's picture

Well written...

Tyler: We have guest post material here...

Fri, 03/09/2012 - 15:32 | 2240675 BliptoP3
BliptoP3's picture

Let's pretend we're not borrowing a trillion dollars a year through Federal deficeit spending alone.  How many jobs will a trillion dollars buy you? 5 million if each job costs you $200,000.  Subtract that from the numbers and then we have a starting point.

Fri, 03/09/2012 - 15:32 | 2240676 tempo
tempo's picture

There can't be a real economic recovery because of the worldwide labor glut where billions are willing to work for $25/day w/o benefits, 12 hours/day, 6 days per week, living 20 per dorm room w/o twitter, MTV, student aid, smartphones, etc. No Company will ever expand in the highest cost most regulated countries. If there was a real recovery, Treasury would not have reported the record highest monthly deficit in history with over 50% of all Govt spending now coming from new debt. Yes, there are new temp, part time min wage jobs but those will quickly be outsourced to the lowest wage least regulated countries. So stay in school, runup your student debt, get a 3 yr worthless masters degree, get our parents to co sign so they also will be screwed. Via la Central Planners who control the world.

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