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02/05/2012 07:15:28 AM · #1 |
To me, as an over the pond outsider, the recent improvements in US employment levels seems to border on a magic trick (I mean that in a good way); over here (UK), there has been a debate about the merits of austerity versus strategic public sector investment. Given that (from my understanding) the Obama administration has orchestrated some interventionalist investment in areas such as education, is the emergence of an improving picture in relation to employment having a positive impact on how the Obama administration is being perceived by the American public? Are the vehement non-interventionists conceding any ground?
Genuinely curious.
Paul |
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02/05/2012 07:32:32 AM · #2 |
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02/05/2012 08:44:00 AM · #3 |
| If a country consists of 100 workers and 10 are out of work and the country borrows money to put 5 of them to work building a bridge, the unemployment rate has gone down, but is the economy any better? |
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02/05/2012 08:59:47 AM · #4 |
Originally posted by photodude:
If a country consists of 100 workers and 10 are out of work and the country borrows money to put 5 of them to work building a bridge, the unemployment rate has gone down, but is the economy any better? |
Well yes - it might be. If:
The (metaphorical) bridge boosts productivity, increases global competitiveness, has an effect on consumer confidence to stave off recession / promote growth etc... |
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02/05/2012 09:41:51 AM · #5 |
Originally posted by photodude:
If a country consists of 100 workers and 10 are out of work and the country borrows money to put 5 of them to work building a bridge, the unemployment rate has gone down, but is the economy any better? |
Depends, does the bridge go to nowhere? |
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02/05/2012 09:52:15 AM · #6 |
It's an election year. "In war, truth is the first casualty." There was a million plus spike in people not in the labor force. While the bureaucrats are explaining away the seasonal adjustments as just something they normally do, it seems a bit of subterfuge to me. As a main street businessman in Colorado, I see the lack of consumer confidence every day. It's hard for people to commit to discretionary expenditures when they are out of work and under water on their home mortgage.
Message edited by author 2012-02-05 09:52:54. |
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02/05/2012 10:10:27 AM · #7 |
Stats lie! Even I, a person that love statistical information knows that!
Has the unemployment rate really went down?
1. People are loosing there benefits. The stats think they got a job, but they may not have.
2. Most companies that are hiring are doing it at the expense of current workers by cutting their hours. Under employed.
3. Stagflation has turned into inflation but wages are level or lower.
4. It is income tax time. Some lower income earners will receive a tax refund even though they paid no taxes during the 2011 year. They are going to spend that money which could be up to $5000+. Showing a sales rebound in some sectors. But it's a false figure because it goods bought by the refund was purchased by other tax payers given to them by the government. And when that money is gone, sales will drop.
5. Example of how under employment works. My wife works full time. The company hires 10 new employes and everyone's hours are cut from 40 to 28 hours a week. Lower pay and could possibly cause her insurance coverage to drop. The insurance company requires that you average 32 hours a week to be covered.
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02/05/2012 11:21:34 AM · #8 |
Originally posted by photodude:
If a country consists of 100 workers and 10 are out of work and the country borrows money to put 5 of them to work building a bridge, the unemployment rate has gone down, but is the economy any better? |
Judging by some bridge collapses in the US the work on the bridge was badly needed! |
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02/05/2012 12:27:18 PM · #9 |
If there has been improvement, it has been moderate. I know several folks that are in the middle of the job search process (and I've also done some looking around). What we are collectively seeing is a moderate improvement in the availability of attractive opportunities, vs. say, a year ago. That represents a very small sample from a single profession (engineering), but I do think there has been positive movement. Whether that slow recovery will be sustained is another question.
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02/05/2012 12:34:51 PM · #10 |
| Time for a new regime just to shake things up a bit! But whatever the political outcome, until the US drops global free trade practices and gets back to a mercantile economic system, we will enter into another phase of economic malaise!! Not only have our factory jobs been sent overseas, but now the high tech jobs are going too. Our country is selling our jobs to the lowest bidders outside our borders. |
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02/05/2012 12:52:14 PM · #11 |
SDW has it.... The published nbrs are a magic trick by not counting some people and counting others when they have gone backwards not forward.
* UNDER employment is huge - hrs cut, multi part time jobs.
* People taking a job with FAR lower paid/benefits -> a lot of the IT workers I know that got layed off - maybe 15-20 people - are NOT doing IT work now let alone what they used to be paid. Maybe 4 out of that crowd are doing a similar job to what they had (not sure about pay rates but they have been dropping).
* Those with jobs are working longer - I worked 20 hrs last w/e and will be closer to 30 this w/e on top of the work week. That is abnormal but it's regularly 50+ hrs a week now.
* Unemployment insurance runs a short time in the US compared to some other countries (they have been playing with that length a little but it's still fudging).... The ones falling off the end usually stop reporting they are looking for work if a spouse is working or they are living off savings/loans but that obviously has an impact on the circumstances.
It's pretty bad still..... Collectively the companies I deal with have thousands (maybe 10's of thousands) of "permanent" and contract positions in India - Those IT positions will never be back in the developed world. I have no way to beat or match those offshore bids..... and these companies make decisions more on cheaper=better then other things - pretend however you like but that is the truth. It's impossible to quote low cost of living wages in a high cost of living location. The political hacks just prattle on about training & better ideas blah blah blah.... That's not going to solve the issue (especially in the US, adding 100 grand of student loans is never going to be a workable solution setting aside what would be worth retaining in). |
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02/05/2012 01:03:15 PM · #12 |
Originally posted by paulbtlw:
To me, as an over the pond outsider, the recent improvements in US employment levels seems to border on a magic trick (I mean that in a good way); over here (UK), there has been a debate about the merits of austerity versus strategic public sector investment. Given that (from my understanding) the Obama administration has orchestrated some interventionalist investment in areas such as education, is the emergence of an improving picture in relation to employment having a positive impact on how the Obama administration is being perceived by the American public? Are the vehement non-interventionists conceding any ground?
Genuinely curious.
Paul |
The unemployment rate has dropped not because there are a lot more jobs, but because the number of people looking for work has (supposedly) dropped. This blog post explains it. //theeconomiccollapseblog.com/archives/i-cant-take-it-anymore-when-will-the-government-quit-putting-out-fraudulent-employment-statistics |
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02/05/2012 02:56:54 PM · #13 |
Originally posted by paulbtlw:
To me, as an over the pond outsider, the recent improvements in US employment levels seems to border on a magic trick (I mean that in a good way); over here (UK), there has been a debate about the merits of austerity versus strategic public sector investment. Given that (from my understanding) the Obama administration has orchestrated some interventionalist investment in areas such as education, is the emergence of an improving picture in relation to employment having a positive impact on how the Obama administration is being perceived by the American public? Are the vehement non-interventionists conceding any ground? |
No. The unemployment numbers are posted by the Bureau of Labor Statistics and budget/deficit numbers are compiled by the Congressional Budget Office. Both are nonpartisan agencies tasked with reporting objective fact. When the numbers are on your side, they're true, and when the numbers don't support your claims, then it's all smoke and mirrors and statistical lies. Employment is up despite massive partisan efforts to block and hinder every presidential policy, and that's just from baseline... imagine the staggering number of unemployed if GM, Chrysler, AIG, etc. had been allowed to fail as Obama's critics once demanded! Yes, the unemployment rate is down and I've seen considerable new business activity among my clients that lends credence to an improving economy. If this had occurred under a Republican president (any Republican), then the same people now claiming the economy "isn't as good as it could have been" would be hailing the turnaround as a miracle and no doubt the Democrats would be spinning for bad news. |
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02/05/2012 03:56:40 PM · #14 |
Originally posted by scalvert:
...despite massive partisan efforts to block and hinder every presidential policy, and that's just from baseline... imagine the staggering number of unemployed if GM, Chrysler, AIG, etc. had been allowed to fail as Obama's critics once demanded! Yes, the unemployment rate is down and I've seen considerable new business activity among my clients that lends credence to an improving economy. If this had occurred under a Republican president (any Republican), then the same people now claiming the economy "isn't as good as it could have been" would be hailing the turnaround as a miracle and no doubt the Democrats would be spinning for bad news. |
I agree. If we had not acted, and the automakers had failed, we would be in a *much* worse position. If we had not intervened in the mortgage crisis, we would be in a *very much* worse position. As Shannon says, look at the data, not the spin put on it by those with an axe to grind.
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02/05/2012 05:10:18 PM · #15 |
Originally posted by photodude:
If a country consists of 100 workers and 10 are out of work and the country borrows money to put 5 of them to work building a bridge, the unemployment rate has gone down, but is the economy any better? |
Well, those 5 people are spending their money somewhere, businesses are possibly being opened to cater for their needs and so on..
I guess it all depends on whether you think Keynes' multiplier can operate in a certain economic situation, which is to say, if the state subsidized employment will end up generating longer term opportunities for those or other workers. |
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02/05/2012 05:28:47 PM · #16 |
I agree with Shannon that the numbers are done by non-partisan people and, as far as I know, have been done the same way for at least decades. Does it reflect an accurate picture of the number of people wo are satisfied with their level of employment? No. But it never has.
On the other hand, I have much less confidence than Shannon or Fritz that we can attribute a known amount of the apparent recovery (especially a large amount) to specific programs carried out by our government. Maybe they have helped. Maybe they haven't. The unknowns and variables are too large that I would consider any confident claim for or against to be spin. I tend to attribute a recovery three years later to natural cyclic patterns.
Here's a fun tidbit. Does everybody remember the 2009 stimulus package? In two months I will be receiving a check from the government for using an electronic medical record. This is the first money I have seen....in 2012. Does anybody think that these specific funds have altered the unemployment rate at all in the last three years? Of course not because it hasn't even been given out yet. I'm not saying the whole program is like this, but what I am saying is the programs is massively complex and slow and nobody likely has a handle on what it has actually done for the economy. |
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02/05/2012 05:33:27 PM · #17 |
There was a very interesting discussion on CNN earlier today where they made reference to some economic gurus (not associated with the government) who stated that the current economy in the USA would NOT recover until sometime in 2015, regardless of who was in power.
I guess the programs devised by either group are more "feel good" instruments than a reflection of reality.
Ray |
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