[Leanan]

"We now return to our regularly scheduled job bust":

http://www.fortune.com/fortune/articles ... 57,00.html

Fortune magazine sees trouble in the disappointing job numbers. Though there is some job growth, it is way lower than expected:



And the actual situation may be even worse than the numbers suggest. A lot of the jobs that have been created are in the housing industry. Three times the usual percentage of new jobs are in housing. We may be heading for a "correction" there.

Fear of high energy costs is one factor blamed for the lack of hiring.

[RiverRat]

Don't expect a hiring frenzy at GM

GM to slash 25,000 US jobs

I suspect the retirees are not gonna fare well too.

[hull3551]

Three points:

First, the housing industry (as mentioned in other posts) is contributing a huge amount to the GDP and payrolls. These are very good paying jobs relative to education or experience. Once this market drops out, you’re going to see a huge hole in the job force. Again, instead of investing in jobs in manufacturing (yeah, wishful thinking)., technology, or other service oriented sectors, we are instead creating jobs in the low-skill sector.

Second, these jobs numbers are grossly understated. They do not include those who have dropped out of the market altogether and given up searching for work. or those who are underemployed. I’ve read where a more realistic number of the unemployment would be closer to 10% in the US, mirroring the EU. Problem is, the EU on average has a much higher saving rate and much lower debt rate.

Lastly, the service sector (which is where most of the new jobs are being generated) traditionally pay less than trade jobs. This is going to continue adding to the budgetary woes of the US as tax revenues will continually be depressed going forward.

[Kingcoal]

I call it the "equity loan economy." As stated above, the pay is very high for construction workers compared to other jobs with similar education/experience requirements. This economy is similar to the 70's, when college graduates with advanced degrees were making significantly less than a union employee at a factory. That didn't last and neither will this economy. Eventually, real value has to created. The high paid, fat, lazy union factory worker met with a huge wakeup call by the late 80's. He went from $25 and up per hour to $7/hr.

In the late 80's and throughout the 90's, value was being created in the US. When a company lays out millions developing technology, that work is rarely in vain. Even if the company fails to capitalize on it, the knowledge and experience goes with the workers to other companies. Even though many ideas are ahead of their time, those ideas become documented and will come to fruitation when the time is right.

For instance, there is a lot of telecom technology which has no market today, but will definitely be needed in the future for advanced video conferencing, etc. I believe that our primitive Internet will eventually turn into a super high bandwidth medium of human interaction; allowing even surgeons to stay at home and work, thus saving a huge amount of hydrocarbons. It might sound farfetched, but the technology is there and the hydrocarbons are not!

All this is beyond GWB, however. God help us in the USA.

[marko]

To answer the question posed at the top of the thread, "Why no jobs?", I would answer that the present expansion has brought millions of new jobs.

Most of those jobs are in China or other Asian countries. Why hire an American factory worker, even at only $7 an hour, when you can hire a Chinese factory worker for 50 cents an hour?

If the added shipping cost for a person-hour's worth of product is less than $6.50 (beyond the cost of shipping domestically within the US from factory to consumer), the company comes out ahead.

At this point, even with higher oil prices, shipping most goods from China is much cheaper than manufacturing domestically. So the new jobs are in China (Vietnam, India, Philippines, etc.).

[jaws]

First reason: Americans fearful of losing their jobs are working completely lunatic numbers of hours, up to 60 a week, and getting paid the same salaries they were before. This boosts productivity for firms and makes it so they don't have to hire more employees.

Second reason: Steve Roach covered it in his column yesterday. Globalization has created an intense deflationist environment in labor. Manufacturing is better done on the cheap in China and "knowledge" economy jobs can be easily shipped to India. This lowers wage competitiveness in every advanced country, such as the US, Germany, France, and so on. Without stimulating demand by flooding consumers with easy credit, America's jobs situation would be more like Germany's. You can read Roach at: http://www.morganstanley.com/GEFdata/di ... 6-mon.html

[MaterialExcess]

60 hour work weeks? Those lazy bastards! Where do people find such cushy jobs?

[cammo2004]

$this->bbcode_second_pass_quote('MaterialExcess', '6')0 hour work weeks? Those lazy bastards! Where do people find such cushy jobs?

[jdmartin]

The whole job situation in the US is atrocious. Thanks to a number of factors it is a Walmart economy, a "race to the bottom" if you will. The masses play a lot of the blame, since the preying on the human nature of greed has exacerbated the problem. If my living wage continuously increases, what do I care if I have to pay more for items (so long as my wage is increasing at least at that level or greater)? Instead, the greed factor of "why should I pay a dollar for that when I can get it for 85 cents at Walmart" is ruining the economy.

Someone else in this thread had it right about the unemployment numbers. If you factored in the number of people who have simply left the job market (gone back to school, committed suicide, or simply moved back in with mom and dad permanently), the numbers would be much higher. I would love to see the number of people underemployed in the US; because most people can't stay unemployed for long, they end up at Mickey D's or Walmart until they find something better (if they ever do). I would guess that half the people I know are underemployed, working in something paying much less than their former field of expertise because there's simply nothing else available here.

[entropyfails]

$this->bbcode_second_pass_quote('cammo2004', '')$this->bbcode_second_pass_quote('MaterialExcess', '6')0 hour work weeks? Those lazy bastards! Where do people find such cushy jobs?

[ubercrap]

I wouldn't laugh at a 60 hour work week. My old boss owned his own business, was president of the company in fact, and he worked god knows how many hours a week- maybe 90-100 hours sometimes? He was in his mid '40's and said he couldn't work as hard as when he was my age. He claimed he used to work about 48 hours, sleep for 7 hours or so, then get up and do it again. If I recall correctly, he was a former Chinese Naval Officer, and had at least one Phd that I know of (mechanical engineering). The man was practically made of steel... That was an intense job with enough stories to fill a small book, and I only lasted there for two months before I quit!

[linlithgowoil]

40 hours a week is plenty. if you cant get your work done in that time, there is something far, far wrong.

to be honest, i could probably get all my work done in about 20-25 hours if i worked flat out and, personally, all these people saying they are working 60 hours + a week are actually lying. what they are doing is working about 40 hours a week, but spending the other 20 hours just 'being at work' - i.e. 'being seen'.

many people do this. many people in my office are terrified to leave at 5 oclock because they think other people will think they dont care about their job etc. so - most people sort of hang around until about 5.20-5.30 even though you know they arent doing anything at all - just to make it look as if they are working beyond the call of duty. its pathetic really.

also - managers of companies etc. who say they work 70+ hours a week - total and utter crap. what they do is work around 10 hours a week and just arse around the other 60 - 'being there'.

[Permanently_Baffled]

$this->bbcode_second_pass_quote('', '
')all these people saying they are working 60 hours + a week are actually lying. what they are doing is working about 40 hours a week, but spending the other 20 hours just 'being at work' - i.e. 'being seen'.

many people do this. many people in my office are terrified to leave at 5 oclock because they think other people will think they dont care about their job etc. so - most people sort of hang around until about 5.20-5.30 even though you know they arent doing anything at all - just to make it look as if they are working beyond the call of duty. its pathetic really.

also - managers of companies etc. who say they work 70+ hours a week - total and utter crap. what they do is work around 10 hours a week and just arse around the other 60 - 'being there'.

[MD]

Look for a "sustainable" work week returning to six or even seven 14 hour days post peak. The elite will have their slaves again.

[julianj]

PB - may I be the first to congratulate you on your new avatar?



EntropyFails: what we need is that ScarcasmZapper Mark 1000 to be manufactured in China for about 0.50 each, Aaron to bulk-buy 100 and send them to the people on this board who fail to see jokes. Perhaps upping the voltage to taser level might educate them faster?



cackles in a Dr Evil fashion

[jimmydean]

$this->bbcode_second_pass_quote('jaws', 'F')irst reason: Americans fearful of losing their jobs are working completely lunatic numbers of hours, up to 60 a week, and getting paid the same salaries they were before. This boosts productivity for firms and makes it so they don't have to hire more employees.

Second reason: Steve Roach covered it in his column yesterday. Globalization has created an intense deflationist environment in labor. Manufacturing is better done on the cheap in China and "knowledge" economy jobs can be easily shipped to India. This lowers wage competitiveness in every advanced country, such as the US, Germany, France, and so on. Without stimulating demand by flooding consumers with easy credit, America's jobs situation would be more like Germany's. You can read Roach at: http://www.morganstanley.com/GEFdata/di ... 6-mon.html

[EnemyCombatant]

$this->bbcode_second_pass_quote('jimmydean', '[')Large corporations are sitting on record levels of cash and with the tight job situation they can expect people to work longer hours requiring even less of a need to add more labour.

[ubercrap]

$this->bbcode_second_pass_quote('EnemyCombatant', '')$this->bbcode_second_pass_quote('jimmydean', '[')Large corporations are sitting on record levels of cash and with the tight job situation they can expect people to work longer hours requiring even less of a need to add more labour.

[crude_intentions]

U.S. jobless rate understated, study says Labor force participation rates have not rebounded

$this->bbcode_second_pass_quote('', ' ')WASHINGTON (MarketWatch) - The current low U.S. unemployment rate probably understates the true level of joblessness by 1 to 3 percentage points, the senior economist at the Boston Federal Reserve says.

Millions of potential workers who dropped out of the labor force during the recession four years ago have not returned as expected and are thus not counted in the official unemployment statistics, said Katharine Bradbury in a paper published by the Boston Fed. Read the study.

The jobless rate fell to 5% in June the lowest level since the terror attacks of September 2001.

Labor force participation rates "have not recovered as much as usual and the discrepancies are large," she wrote.

"Current low rates of labor market participation thus potentially represent considerable slack in the U.S. labor market," she wrote.

The amount of slack in the economy is a key variable for Federal Reserve policymakers, who have been raising interest rates for more than a year to return rates to "neutral' levels.

All things equal, the more slack in the economy, the lower rates ought to be.

Some policymakers have argued that the economy is close to full employment with the jobless rate at 5%, thus justifying higher rates to pre-empt inflationary pressures from building in a tight labor market.

While the official unemployment rate has fallen from a peak of 6.3% in June 2003 to 5% in June 2005, the labor force participation rate remains close to 15-year lows of 66%.

Typically, labor force participation rates rebound sharply following recessions, Bradbury found.

The official jobless rate understated the severity of the slowdown in 2001 and has overstated the strength of the recovery since then, she said.

Government unemployment statistics are calculated by asking adults who aren't working if they'd like to work and if they've actively looked for work. Only those who are working or looking are considered in the unemployment rate calculations.

[I_Like_Plants]

It's not even all that secret, they're fairly out in the open about how they count the unemployed, if you dig a bit.

If you're not looking, defined as not registered with your local employment office, you don't count. I've not had one of those "job" thingies since about 1991, myself. I could be doing ok, which I am, or I could be bumming and couch-surfing, that's not counted.

That being said, the US is a WEALTHY society, there's still a long way to fall for US society in general.