Deadly Long Term Unemployment
Posted: December 2, 2011 Filed under: Economy, unemployment | Tags: long term unemployed, policy, unemployment 8 Comments
We have a new unemployment rate of 8.6% that looks much improved on the surface. Notice I had to qualify that statement. This is because of the flows in and out of labor markets and the patterns of jobs. Ever since they changed the measures of “employed” to mean any one working at least one hour of work, the rate is less meaningful than the underlying patterns. There are several underlying numbers that make this unemployment report a mixed bag.
On the good side, there was some job creation and there appears to be a larger number of people working more hours. This means that underemployment is improving. I should mention that unemployment can actually get worse for awhile after a recession–making it a lagging indicator–because improving job markets encourage unhappy job holders to start looking for a different situation. What we are seeing is that people are able to pick up more hours. That’s not part of the job switch behavior. It means the situation for current job holders is improving.
The bad news is for the long term unemployed whose unemployment levels stayed the same. There are also indications of an outflow of “discouraged” workers who have simply given up looking for work and are likely off the unemployment roles now. This is very troubling and requires immediate policy response.
In November, the number of job losers and persons who completed temporary jobs declined by 432,000 to 7.6 million. The number of long-term unemployed (those
jobless for 27 weeks and over) was little changed at 5.7 million and accounted for 43.0 percent of the unemployed. (See tables A-11 and A-12.)The civilian labor force participation rate declined by 0.2 percentage point to 64.0 percent. The employment-population ratio, at 58.5 percent, changed little.
(See table A-1.)The number of persons employed part time for economic reasons (sometimes referred to as involuntary part-time workers) dropped by 378,000 over the month to 8.5 million. These individuals were working part time because their hours had been cut back or because they were unable to find a full-time job. (See table A-8.)
There are two ways the government could deal with this long term unemployment. The first would be most direct. That would be hiring them directly. Given the current political situation, that is unlikely to happen. The second way would be to pay for the first year or two of their salaries and benefits. This would probably be more acceptable to republicans–however I do question their commitment to improving the economy and the job situation in general–but it would take some work to get the apparatus in place. President Obama has made policy suggestions that would pay states to keep education, public health, and public safety employees but that has met with demands for cuts elsewhere to pay for reimbursements. This is a good suggestion, but doesn’t do anything to deal with the number of long term unemployed who are know disenfranchised from the work environment, are losing skills, and are less likely to be hired due to discrimination by employers who don’t like large, “unexplained job gaps. A program needs to be directly targeted to this group.
Why am I suggesting this? It is because the number of labor market economists that are crunching numbers at the moment show us that it’s taking forever at this rate to bring down unemployment and we are likely creating a permanent underclass. Felix Salmon has a graph and some analysis this demonstrates the problem.
When employed people become unemployed, that’s bad news, and immediately visible in the unemployment rate. When unemployed people leave the labor force entirely, that’s equally bad news, but it’s a tougher measure for the public to connect with, since at that point they’re no longer counted in the unemployment rate. Everybody knows what “unemployment” is; the population which cares about the “employment-to-population ratio”, by contrast, is wholly comprised of wonks.
The plunge in the employment-to-population ratio over the course of the Great Recession is going to be its biggest and most lasting legacy. We’re now back to the levels last seen in the days before most women worked, but we live in a very different world now. In the late 1970s, a woman without a job was much less likely to consider herself unemployed than in the early 2010s. And when she casts her vote in November, the degree to which she’s happy or unhappy with the current administration is going to be much more connected to her actual employment status than it is to whether she’s officially showing up in the unemployment rolls.
Over the next few months, we’ll get a better sense of the signal-to-noise ratio in the 8.6% number. I’m hopeful that we’ve seen the last 9 handle in the headline unemployment data series, and if I’m right, then the optics of the unemployment rate are, at the margin, good for Ds and bad for Rs. But the unemployment rate is not a particularly good gauge of how well the economy is functioning, or how many people have jobs. And I’m very pessimistic that the employment-to-population ratio is going to get back above 60% even over the medium term. It’s certainly not going to get there before the election.
Here’s some more composite analysis from NBC interviews with economists.
Long-term unemployment remains a big problem: The average duration for joblessness surged to a record-high 40.9 weeks. Stagnation in wages also continues, as more employed workers took on second jobs. There were just under seven million multiple job-holders for the month, the highest total in 2011 and the most since May 2010.
Traders offered little reaction to the report. Futures already had been indicating a positive open but lost some ground in the ensuing minutes after the Labor Department report hit the tape.
“At this pace of job growth, it will be more than two decades before we get back down to the pre-recession unemployment rate. Moreover, a shrinking labor force is not the way we want to see unemployment drop,” said Heidi Shierholz, economist at the Economic Policy Institute. “At this rate of growth we are looking at a long, long schlep before our sick labor market recovers.”
Here’s a bleak assessment from Dean Baker via Taylor Marsh.
It takes roughly 90,000 jobs to keep even with the growth of the labor force. At this rate, it will take close to 200 months, or 16 2/3 years to make up for the 10 million job deficit in the economy.
Even the White House is admitting that we’re a long way from the pre-recession employment numbers. Here’s the nifty graph that Calculated Risk has been updating over
time that clearly demonstrates the literal uphill battle. Since republicans are in no mood to improve the economy and the jobless rate given their strong desire to regain the White House and the Senate, I don’t see much hope for any solution any time soon. If they do regain any of the above after the election we probably won’t see any improvement at all. That’s why I think the Obama administration needs to work on continued targeted fixes. Again, I would recommend directly paying businesses to hire the long term unemployed. I actually think it would be worth offering some spending offsets if that is going to be what it takes because we can’t afford to continue to endure these levels of duration. The more chronic the problem becomes, the more it will cost us and the more it will ruin millions of folks’ lives.
The Art of Doublespeak
Posted: December 1, 2011 Filed under: #Occupy and We are the 99 percent!, 2012 presidential campaign, double-speak, Economy, income inequality, unemployment | Tags: 2011: days of revolt, 2012 presidential election, Financial Crisis 9 CommentsLanguage is important. Words can inspire, inflame, enrage. Words can hide a speaker’s intentions. Sing me a lullaby. Spin me a fairytale. Sell me a load of bull-hockey.
One of today’s best-known language twisters is Frank Luntz. Pollster and political consultant, Luntz is the Master of Political Doublespeak. He would have made Orwell proud: War is Peace, Freedom is Slavery, Ignorance is Strength. He crawls out during every election cycle with the creepy focus groups, wired up and ready to go. We learn ‘what words work.’ Otherwise known as ‘what words obfuscate, spin and get the best reaction from would-be voters.’
Well, here’s a Newsflash: Luntz is worried about Occupy Wall Street, all those sorry slackers the GOP and various critics have sidelined as hippies, losers and Obama-lovers. Seems from Luntz’s point of view, OWS is having an impact on political discourse.
No kidding Sherlock!
And so, Luntz decided a tutorial was needed to school Republicans how to “speak” when asked questions about the very issues that the Occupy wave has been raising.
Fascinating! A defense against the so-called irrelevant. But even more fascinating is the list of rules on how to ‘discuss and defend against’ the grievances that Occupy members have introduced into the public sphere.
The very first instruction made me laugh:
Don’t say capitalism.
Because people might start questioning the broken economic construct that’s taken root in the US. Btw, I haven’t heard OWS slamming capitalism, per se. It’s Vulture Capitalism, the darling of the neoliberal/libertarian set, that’s being questioned and panned, where only the well-heeled financial class takes the booty while the rest of the country is left to collect unemployment checks and shop with food stamps. Sorry, don’t think ‘free market’ or ‘economic freedom’ will wash in a country where poverty is rising at an alarming rate and over 20% of American kids are classified as food insecure.
Politicians whether Right or Left need to do far better than that. Like maybe tell the truth: that the financial class in this country has been running a huge Ponzi scheme, that transnational corporations are willing to run roughshod over everything in a blind pursuit of profit, that endless war makes money for the few, while the many bleed.
That would be refreshing.
Don’t say the government taxes the rich. Tell them the government takes from the rich.
Oh yes, that’s much better. Then pull out Warren Buffet’s statement that his tax rate
[as a multi-billionaire] is lower than what his secretary is required to pay. And please, take a spin over the corporate history of negative taxes after all the loopholes and government largesse heaped on the ‘job creators’ is taken in to account. Then too, let’s not forget the ‘off-shore’ pooling of tax-free profits and tidy nest eggs. The beat goes on for those with the courage to look.
The government takes from the rich? Hahaha. More like the government sucks up to the rich and their ever-present lobbyists.
Republicans should forget winning the battle for the middle-class. Call them hardworking tax-payers.
Yes, Republicans should forget winning the middle-class since they’ve gone out of their way to eliminate them, crush them out like last year’s cigarettes.
Frank Luntz is ‘really’ scared of the Occupy Movement ? With rules like this he may be out of a job. If the Republican’s go-to wordsmith can’t get his head or words around the basic complaints of not simply Occupy but most Americans and/or the very real economic and political discontent, then they are deaf, dumb and blind.
Or maybe smart like the wily fox. Because the evidence is everywhere. What to do? Keep the disinformation and propaganda machine in high gear. I won’t belabor the hypocrisy and cynicism of Luntz’s list. He and the entire stable of political pollsters, consultants and analysts on all sides are merely symptoms of a system flailing in the wind, a system that’s forgotten how to reach out or even talk to real people in anything approaching honest discourse. A system that has no respect for its citizenry.
Will the Luntz approach work as it has in the past?
We shall see. But I invite you to read the Ten Commandments of Political Doublespeak for 2012 at the link above. Some examples will make you laugh. Several will make you mad as hell.
Oh, and here’s a tip: Don’t say the word ‘Bonus.’
Occupy Philly and Independence Hall
Posted: November 30, 2011 Filed under: #Occupy and We are the 99 percent!, Banksters, Corporate Crime, corruption, Economy, financial institutions, income inequality, jobs, U.S. Economy, U.S. Politics, unemployment, voodoo economics | Tags: 2011: days of revolt, Financial Crisis, U.S. Economy, unemployment 16 CommentsBlack Friday, Philadelphia, Pa.
My first look at Occupy Philly was after a free ride on the 9:52 Media Local, The Santa Train. This was not by plan but a matter of sheer coincidence. I should have guessed;
I was the only one standing on the Morton platform without a small child in tow. But shortly after boarding, it was all too clear. The elves came first, wailing Jingle Bells and Wish You a Merry Christmas. They were followed by out-of-season Mummers dressed in holiday garb, belting out another round of X-mas cheer, complete with accordion, banjo and sax. Mrs. Claus assured the children that Santa was busy, busy at the North Pole, making sure all their wishes [even though edited to economic realities] would come true. And then, there was the free candy and balloon animals.
The magic of childhood! Where we can believe everything and anything. When the world appears kind and right and true.
An out-of-stater now, I deliberately got off at Suburban Station, my old work stop. Also, the stop at which I’ve frequently disembarked to attend exhibits at the Franklin Institute, the Museum of Natural History or the Philadelphia Museum of Art, a brisk walk west up the Parkway, past the Rodin Museum and the soon-to-open home for the controversy-laden Barne’s collection.
But not today.
This morning I headed east, winding through the underground towards City Hall and the Occupy Philly encampment. Later, I would team up with a friend and hoof down to the historic district. But right now, I had a different historical event in mind.
I no sooner hit the outside doors than the vivid blue of plastic tarps and tent tops were visible. A strange sight. Normally, I would have walked through the West arch at City Hall, stood for a few moments googling at the city’s Christmas tree. But this year was different. So different.
The western entrance to the City Hall complex was barricaded. ‘For Restoration’ the signs said. No towering tree this year. Instead, the Occupy tents decorated Dilworth Plaza, a strange but fascinating sprawl of makeshift living quarters and standard issue camping gear. The area was quiet and still, the air crisp. I circled around the entire plaza. No sight of my friend, so I headed back towards the encampment, spotted the medical and information tents, as well as a petition table outlining the dangers of in-state fracking by over-zealous gas drilling companies.
At the Information Tent there was an array of literature on upcoming actions, the November issue of the Occupy Wall Street Journal and several people discussing Mayor Nutter’s deadline to dismantle the encampment within 48 hours. Two of the occupiers said almost in unison: ‘It was never about the tents.’
So what is it about? It’s a question I read constantly on the blogs and in newspapers, even hear from family and friends.
Here’s what I learned in the morning hours I spent on the Plaza:
- In the 53 days of Occupy Philly, 26,000 local citizens signed on expressing support.
- At the height of the encampment, City Hall was encircled with tents, sleeping bags and a variety of makeshift living accommodations.
- Active supporters numbered around 200-300, some living on-site, others coming in to protest, march and rally during the day.
- Local Unions support the effort. In fact, the Trades Union offered to assist the protestors in the original plan to move off Dilworth to an encampment across the street. The Union needs those ‘renovation’ jobs. That idea was scrapped because permits were denied.
- The area was clean. No needles, drug paraphernalia or trash scattered about as the MSM would have readers/viewers believe taints all encampments. Talking to several encampment members, I was told a goodly portion of each day is spent ‘cleaning up.’
- The encampment/protest was peaceful. There was a sense of community and the overriding sentiment was to voice anger and dissent over the widening income inequality in the US and the corporate capture of all facets of government.
- I heard no political posturing or Obama shilling. Simply stated, the system is broken for the 99%.
- Forty to fifty of the encampment members were homeless. They joined for the free food and the safety of numbers.
- The police presence, even on this Friday morning, was unusually large but basically stationed within the confines of the City Hall plaza.
- Though Mayor Nutter had leveled a 48-hour deadline, there was no sense of panic or great urgency the morning I arrived. I later learned that the majority of the encampment was dismantled voluntarily Sunday evening and the homeless were moved elsewhere for their own safety.
- This morning [Wednesday 11/30 at 1:20 am, according to the Associated Press], the Philly police department began tearing down the remaining tents.
But as the protesters I spoke with said: It was never about the tents. It has always been about visibility—the eyesore of inequality, injustice and corruption.
I left Dilworth Plaza, and then headed down to Independence Mall. A surreal juxtaposition. In a matter of a few blocks, my friend and I walked from the current protest to the historical marker of the Mother of All Protests. Philadelphia is the birthplace of the Declaration of Independence and the US Constitution. We strolled through the portrait gallery installed in the Second Bank of the United States and the faces of those earlier protesters, that grand collection of merchants and farmers, philosophers and scientists, lawyers and bankers stared back. What would they be thinking? I wondered.
We went on to Carpenter’s Hall, where Benjamin Franklin reportedly had secret meetings with like-minded citizens prior to the Revolution. Years later, on leaving the Constitutional Convention, a woman reportedly asked Franklin what sort of government he and the others had designed. Franklin’s terse reply: ‘A Republic, Ma’am. If you can keep it.’
Our final stop was Independence Hall, which was originally the Pennsylvania State House. This was where the Second Continental Congress met, the Declaration of Independence was adopted and where the Constitutional Convention met to draft, debate, and then sign the US Constitution in 1787.
We’re a long way from who and what we were in 1787. But Franklin’s words have a haunting edge to them: ‘A Republic, Ma’am. If you can keep it.’ Another quote that’s perhaps equally pertinent is:
‘We must hang together, gentleman, or assuredly we will all hang separately.’
For me at least, this is what the Occupy Movement has been and is still about. In an age where corporations have been awarded the distinction of personhood, when free speech is equated to money and The Rule of Law is applied in an unjust and inequitable fashion then we, ordinary citizens, have a duty to support and join one another in protest. To hang together, if you will.
Oh, and that Tea Party, the real one in Boston that got everything rolling?
We all recall the ‘taxation without representation’ line from our school years, stemming from the passage of the Stamp Act in the 1760s and later the Tea Act in 1773. King George had debts to pay off—a Seven Year’s War among other things. And the East India Company’s tea pitched into the Boston Harbor? East India was basically provided a monopoly on tea shipped into the colonies. The company [and its aristocratic shareholders] were none too happy about their profits pinched and drowned in the harbor and helped push [lobby] the King to pass the Coercive Acts, aka The Intolerable Acts. The colonists were generally peeved at the British Parliament for taxing them without their consent and then adding insult to injury, giving the East India Co. a cushy, duty-free export to undercut colonial merchants. But they were beyond peeved when punitive measures were leveled. They demanded that Parliament end its corrupt economic policies with and stop the bailout of that era’s own TBTF East India Company.
Sound vaguely familiar? Whatever’s old is new again. Of course, no one age can be accurately compared to another. Context is everything. To quote Barbara Kingsolver from the November issue of The Occupy Wall Street Journal:
“Every system on earth has its limits. We have never been here before, not right here exactly, you and me together in the golden and gritty places all at once, on deadline, no fooling around this time, no longer walking politely around the dire colossus, the so-called American Way of consecrated corporate profits and crushed public compassion. There is another American Way. This is the right place, we found it. On State of Franklin, we yelled until our throats hurt that we were the 99% because that’s just it. We are.”
As I’ve said elsewhere, I support Occupy until I don’t. The ‘don’t’ for me is if the Movement becomes another co-opted arm of one corrupt political party or another. Our existing two-party system is thoroughly compromised; a shipload of bleach and scrub brushes couldn’t clean it up. I support Occupy because I hate the idea of leaving my kids and future grandbabies with a broken, twisted Republic, one dedicated to piranha-school profits, the amassing of criminal wealth by a callous, irresponsible few at the expense of the many. I support the Occupiers because of those sweet-faced kids on the Santa train; they deserve the best we have. But I also support what I saw on Dilworth Plaza because of what I saw and recalled inside Independence Hall, what we owe to all those who sacrificed and struggled, dreamed and achieved, lived, loved and died over the last 200+ years. We stand on the shoulders of so many.
That’s something we should never forget because our past, our history is no small thing. But our future, that other American Way? That’s all about what we do now.








Recent Comments