Showing all posts tagged: unemployment
The furor over Friday’s report revealed a political movement that is rooting for American failure, so obsessed with taking down Mr. Obama that good news for the nation’s long-suffering workers drives its members into a blind rage. It also revealed a movement that lives in an intellectual bubble, dealing with uncomfortable reality — whether that reality involves polls or economic data — not just by denying the facts, but by spinning wild conspiracy theories.
It is, quite simply, frightening to think that a movement this deranged wields so much political power.
Truth About Jobs - Paul Krugman via NYTimes.com
The GOP spins off the tracks because of slightly better jobs numbers (below 8% unemployment for the first time in 42 months), and claims jiggery-pokery. ‘Deranged’ may not go far enough.
Catharine Rampell via NYTimes.com
The share of working-age Americans who are either working or actively looking for a job is now at its lowest level since 1981, when far fewer women chose to do paid work. The share of men taking part in the labor force fell in April to 70 percent, the lowest figure since the Labor Department began collecting these data in 1948.
The times are very hard in Greece, unemployment is rising, so how to make a living? Go back to the land.
Rachel Donadio via NYTimes.com
Unemployment in Greece is now 18 percent, rising to 35 percent for young people between the ages of 15 and 29 — up from 12 percent and 24 percent, respectively, in late 2010. But the agricultural sector has been one of the few to show gains since the crisis hit, adding 32,000 jobs between 2008 and 2010 — most of them taken by Greeks, not migrant workers from abroad, according to a study released this fall by the Pan-Hellenic Confederation of Agricultural Associations.
“The biggest increase is in middle-aged people between 45 and 65 years old,” said Yannis Tsiforos, the director of the confederation. “This shows us that they had a different sort of employment in the past.”
In Greece, as elsewhere in the Mediterranean, most families have traditionally invested heavily in real estate and land, which are seen as far more stable than financial investments, and it is common for even low-income Greeks to have inherited family property. Increasingly, as the hard times bite deeper, many Greeks are deciding or being forced to fall back on that last line of defense.
Enrollment in agricultural schools is also on the rise. Panos Kanellis, the president of the American Farm School in Salonika, which was founded in 1904 and offers kindergarten through high school as well as continuing education in sustainable agriculture, said applications tripled in the past two years and enrollment in classes like cheesemaking and winemaking has been rising.
Mr. Kanellis says that young people frequently come to him and say: “I have two acres from my grandfather in such-and-such a place. Can I do something with it?”
A growing number of Greeks are asking themselves that question, and some are deciding they can. “I think a lot of people will do this,” Ms. Tricha said. “In big cities, there’s no future for them. For young people, the only choice is for them to go to the countryside or to go abroad.”
This is happening in the US too. Expect much more of a move back to the land in 2012.
Robert Schiller states that long-term unemployment decreases basic democratic impulses, and implies that in the long run we might be creating an underclass that would support anti-democratic government:
Robert Schiller via NYTimes.com
Bad as it is for those without jobs and their immediate families, unemployment tears the fabric of our society. Duha T. Altindag of Auburn University and Naci H. Mocan of Louisiana State University used data collected by the World Values Survey on more than 130,000 people from 69 countriesto learn how unemployment affects confidence in civil society and basic democratic institutions.
They looked at a survey question inquiring whether “having a strong leader who does not have to bother with Parliament or elections” is a good thing. In the United States, being jobless increases the propensity to agree by about 11 percentage points, to 38 percent from the sample mean of 27 percent, after controlling for other factors like income and education. They also found that, in countries where they had the appropriate data, people who have been unemployed for more than a year are even more likely to agree, if other factors are held constant.
Some of the social discord and mistrust of government in our country of late is surely connected to long-term unemployment. We need to accept that we are now in very unusual times, and that unusual steps are needed.
[…]
The stakes are very high here, and they are not just economic. As anger rises in today’s economy, I’m reminded of Thomas Jefferson’s words about the danger of “angry passions” arising between the North and South over the question of extending slavery to the Missouri territory. In an 1820 letter, he wrote that “this momentous question, like a fire bell in the night, awakened and filled me with terror.” He went on to predict, from his observations of such rancor, the secession of the South that was to come 40 years later.
Our country is a much more stable and just society now than it was in 1820. Still, we should regard the current economic dispute as another fire bell in the night. It is important to recreate the sense of a just society, without anger — and an important step in that direction is to ensure that there are enough jobs.
Yes, joblessness should make us awaken with terror, like a fire bell in the night.
How the Press ‘juked the stats’ and followed the politician’s mania about hte debt and ignored the average person’s concerns about unemployment:
Jason Linkins via HuffPo
One day, we’re going to look back on the late spring/early summer as a time of widespread journalistic failure. At the time, the Beltway Deficit Feedback Loop was running at maximum speed and the obsession was deeply entrenched. The absurd notion that a political party could attempt to leverage demands by threatening to send the United States into default and set off a cataclysm within the interconnected global economy therefore got covered as just another interesting point of view, rather than pure sociopathy. At the time, it was increasingly common to see ordinary Americans, expressing themselves through polls, urging action on the unemployment crisis. But it was just as common for the press to juke the stats to fit their preferred narrative — and at the time, the press was freebasing pure, uncut deficit hysteria.
The National Journal noted the extremity of this media obsession with a chart of their own:
Back then, even some people who were willing to mildly criticize the media on this score ended up choking on apologies and excuses. The best the Atlantic’s Derek Thompson could offer was: “The press was partly complicit in this fade-out effect. But it’s hard to blame the media too much for resisting to write feverishly about nonexistent efforts to fix a static unemployment problem.” Translation: if lawmakers aren’t doing anything to fix unemployment, it’s hard to make a story out of it, and we’re not willing to try.
With lawmakers diddling one another in deficit committees and members of the media denying their own agency, someone had to step up. And that someone ended up being the Occupy Wall Street movement. Their human-flesh social network took up physical space on the ground and started telling their own stories, using Tumblr as their means of aggregation.
A fumble. And the press continue their mistake by endlessly trying to cast the Occupy protests as a full-fledged movement. That comes in the spring, or maybe next summer.
… [T]he fact is that right now the economy desperately needs a short-run fix. When you’re bleeding profusely from an open wound, you want a doctor who binds that wound up, not a doctor who lectures you on the importance of maintaining a healthy lifestyle as you get older. When millions of willing and able workers are unemployed, and economic potential is going to waste to the tune of almost $1 trillion a year, you want policy makers who work on a fast recovery, not people who lecture you on the need for long-run fiscal sustainability.
Paul Krugman, The Hijacked Crisis
(via tartantambourine)
(via tartantambourine)
(via The 4 Scariest Economic Graphs I’ve Seen This Year - Derek Thompson - Business - The Atlantic)
Graphs that plot against percentage of previous peak, a treatment I haven’t seen before. And look how far unemployment has to go to get back to the status quo ante. Which means, I think, we’ll be into the next downturn before we climb back. Which means the New Depression is here already, and we don’t know it yet, like stubbing your toe, and it take a fraction of a second before the pain hits.
Friedman is up to his old tricks in today’s NY Times, explaining away the responsibilities of business, and laying unemployment at the feet of the working people.
Thomas Freidman, The Uncertainty Tax
If you want to understand why the unemployment rate has been stubbornly lodged around 9 percent, a good place to start is with the eye-popping mortgage statistics released last week by the economic analysis firm CoreLogic: 38 percent of homeowners with second mortgages are underwater. They borrowed against the value of their homes, and they now owe more than their houses are worth. The total number of underwater homeowners in America, with first and second mortgages, is a stunning 22.7 percent. In Nevada alone, 63 percent of all mortgaged properties are worth less than the owners paid; in Arizona 50 percent, Florida 46 percent, Michigan 36 percent and California 31 percent.
When people are so underwater, they find it hard to move to take new jobs, they find it hard to borrow or raise cash for education or start-ups, and banks become even more cautious about lending. Until we as a country figure out how to divvy up these losses on housing and let these markets clear and move on, they will be a serious drag on employment.
Friedman offers up some serious numbers, and makes a point — that we need to get the real estate losses behind us — but as usual, he and I diverge at this point.
Freidman believes we have ‘structural’ problems in the economy, meaning that workers don’t have the skills needed for the new economic world, and he tees that up by talking about this mortgage overhang, explicitly saying people can’t move to where the work is. And, underneath all the watered down ideological mumbo-jumbo is the paternalistic perspective that these workers are responsible for their lack of skills, and improvidence, in the first place.
At the same time, you talk to U.S. companies doing advanced manufacturing and many will tell you they struggle even now to find workers with the blue-collar skills they need to replace their retiring employees. Thanks to a credit bubble over the last decade, we created a lot of jobs for people — in construction and retail — who did not have globally competitive skills or post-high school degrees. Those workers will need retooling.
McKinsey says its research found that “too few Americans who attend college and vocational schools choose fields of study that will give them specific skills that employers are seeking. Our interviews point to potential shortages in many occupations, such as nutritionists, welders, and nurse’s aides — in addition to the often-predicted shortfall in computer specialists and engineers.”
The report concludes, “Progress on four dimensions is needed: Ensuring that the work force acquires skills needed for the jobs that will be in demand, finding ways for U.S. workers to win ‘share’ in the global economy” — by encouraging more foreign investment in the U.S. and by getting companies who have off-shored jobs to take advantage of falling telecom prices to on-shore them to low-cost American cities and towns instead — “encouraging innovation, new company creation, and scaling up of industries in the United States, and removing unnecessary impediments that slow business investment and job creation.”
[…]
Any good news? Yes, U.S. corporations are getting so productive and sitting on so much cash, just a few big, smart, bipartisan decisions by Congress on taxes and spending (and mortgages) and I think this whole economy starts to improve again. Workers with skills will be the first to be hired.
So, if this structural skills gap is true, why didn’t US companies train their workers, instead of firing them and outsourcing the work to Taiwan?
But our mass unemployment hasn’t been caused by an enormous skills gap, as Paul Krugman made clear last September:
Pauul Kruman, Structure Of Excuses
What can be done about mass unemployment? All the wise heads agree: there are no quick or easy answers. There is work to be done, but workers aren’t ready to do it — they’re in the wrong places, or they have the wrong skills. Our problems are “structural,” and will take many years to solve.
But don’t bother asking for evidence that justifies this bleak view. There isn’t any. On the contrary, all the facts suggest that high unemployment in America is the result of inadequate demand — full stop. Saying that there are no easy answers sounds wise, but it’s actually foolish: our unemployment crisis could be cured very quickly if we had the intellectual clarity and political will to act.
In other words, structural unemployment is a fake problem, which mainly serves as an excuse for not pursuing real solutions.
[…]
But some people on the other side of the aisle say similar things. For example, former President Bill Clinton recently told an interviewer that unemployment remained high because “people don’t have the job skills for the jobs that are open.”
Well, I’d respectfully suggest that Mr. Clinton talk to researchers at the Roosevelt Institute and the Economic Policy Institute, both of which have recently released important reports completely debunking claims of a surge in structural unemployment.
After all, what should we be seeing if statements like those of Mr. Kocherlakota or Mr. Clinton were true? The answer is, there should be significant labor shortages somewhere in America — major industries that are trying to expand but are having trouble hiring, major classes of workers who find their skills in great demand, major parts of the country with low unemployment even as the rest of the nation suffers.
None of these things exist. Job openings have plunged in every major sector, while the number of workers forced into part-time employment in almost all industries has soared. Unemployment has surged in every major occupational category. Only three states, with a combined population not much larger than that of Brooklyn, have unemployment rates below 5 percent.
Friedman seems to rely on an anecdotal approach to research, like talking with business owners, who would rather buy machines than hire workers; Krugman and the researchers cites are looking at comprehensive numbers. I am going with Krugman’s reality-based observations, and ignoring Friedman’s screed, as usual.
But the well-off and the business owners want to believe that these problems are structural, so they can put off the day of reckoning, and blame the victims of the current mishandling of the jobs crisis.
On both sides of the Atlantic, a consensus has emerged among movers and shakers that nothing can or should be done about jobs. Instead of a determination to do something about the ongoing suffering and economic waste, one sees a proliferation of excuses for inaction, garbed in the language of wisdom and responsibility.
So someone needs to say the obvious: inventing reasons not to put the unemployed back to work is neither wise nor responsible. It is, instead, a grotesque abdication of responsibility.
Paul Krugman, Against Learned Helplessness
Paul Krugman, Defining Prosperity Down
I’m starting to have a sick feeling about prospects for American workers — but not, or not entirely, for the reasons you might think.
Yes, growth is slowing, and the odds are that unemployment will rise, not fall, in the months ahead. That’s bad. But what’s worse is the growing evidence that our governing elite just doesn’t care — that a once-unthinkable level of economic distress is in the process of becoming the new normal.
And I worry that those in power, rather than taking responsibility for job creation, will soon declare that high unemployment is “structural,” a permanent part of the economic landscape — and that by condemning large numbers of Americans to long-term joblessness, they’ll turn that excuse into dismal reality.
[emphasis mine.]
We are increasingly being governed by members of an institutional elite who find more in common with business leaders and the wealthy, and this oligarchy could care less about the suffering and alienation of the average person.
And if the President, Congress, and the Federal Reserve agree that chronic unemployment and the growth of the underclass is ‘structural’ and inevitable, what will happen? Krugman concludes:
What lies down this path? Here’s what I consider all too likely: Two years from now unemployment will still be extremely high, quite possibly higher than it is now. But instead of taking responsibility for fixing the situation, politicians and Fed officials alike will declare that high unemployment is structural, beyond their control. And as I said, over time these excuses may turn into a self-fulfilling prophecy, as the long-term unemployed lose their skills and their connections with the work force, and become unemployable.
I’d like to imagine that public outrage will prevent this outcome. But while Americans are indeed angry, their anger is unfocused. And so I worry that our governing elite, which just isn’t all that into the unemployed, will allow the jobs slump to go on and on and on.
When do the protests start, I wonder? When will the unemployed march on Washington?
