Monthly Archives: May 2012
The eight hundred pound gorilla in the room when one discusses the unemployment rate is its accuracy.
8.1% of what? Apparently, it is 8.1% as measured by those still receiving unemployment benefits, i.e. “actively” seeking work (a requirement to continue to receive the benefits). Here’s the reality:
In April the number of people not in the labor force rose by a whopping 522,000 from 87,897,000 to 88,419,000. This is the highest on record. The flip side, and the reason why the unemployment dropped to 8.1% is that the labor force participation rate just dipped to a new 30 year low of 64.3%.
So, that means people have dropped out of the labor market and some have quit looking for work?
Yes. All one has to do is look at this chart and understand that a huge piece of the labor market has simply vanished from the statistics used to compute the official unemployment rate.
The current labor participation rate is equal to that of January 1982. From a high of 67.3% in January 2000, it has dropped 3% since. That is huge.
Yet, we’re only at 8.1%? Not bloody likely. Not if history is any gauge.
So who are the missing workers?
The conventional wisdom out there likes to explain that huge drop away by claiming that the baby boomers are most likely choosing to retire rather than seek work. They further claim there’s no reason to panic, it’s the old folks dropping out and they have their retirement to fall back on.
In fact, the older demographic has remained steady and, in fact, even seen job percentage increases among those thought to be retiring.
Job holders 55 and up have risen by 3.9 million — and fallen by 8.1 million among those under 55, Labor Department data show. It’s been 50 months and counting since payrolls peaked, a post-war record. Labor releases the April jobs report on Friday morning.
For the 65-69 and 70-74 groups, the employed shares are up 1.1 percentage points and 1.6 percentage points, respectively, over the past four years.
So much for that myth. In fact the early retiree level (i.e. those who claim Social Security at the lowest possible age – 62) dropped to 26.9% last year, the lowest since 1976.
As that final chart points out along with the accompanying stats, it isn’t the baby boomers who are causing the labor participation rate to drop. It is workers in the two younger demographics who’ve stopped getting benefits and still don’t have work.
Political implications? Well one can fudge the official numbers all one wishes, but unemployment is a personal thing. Official numbers don’t mean squat to someone without a job and is unlikely to convince them that things are better than they were.
Whether or not the official number drops below 8% before the election, the reality of unemployment to those 5 million without a job and not carried in the official number remains.
The following statistics were released today on the state of the US economy:
The Monster employment index rose three points in April to 146.
The headline numbers of the Employment Situation were that 120,000 net new jobs were created in April, well below expectations of 165,000 jobs. Added to that weak report were that both weekly hours and hourly wages were unchanged for the month, indicating no serious increase in pressure for hiring or demand for labor. (Well, actually, hourly earnings rose 1¢. Meh.) The unemployment rate, however, declined by 0.1% to 8.1%, which is anything but a good sign. That’s because, in the last month, the labor force again shrank from 154,707,000 in March to 154,365,000 in April, as 342,000 workers left the labor force. Likewise, the labor force participation rate declined to 63.6%, the lowest since December, 1981. Additionally, 141,865,000 people were employed in April, down from 142,034,000 in March, a decline of 169,000 in the number of people employed. So, once again the "decline" in the unemployment rate is nothing more than a decline in the labor force that is faster than the decline in employment. The headline number covers a lot of ugly details in the "A" tables of the report. As always, I’d point out that, if the labor force participation rate were at the historical average of 66.2%, the actual unemployment rate for April would be 11.73%, up from 11.56% in March. Overall, it’s a pretty negative report.
A quickie as I have a busy morning that doesn’t include much blogging:
The April jobs report is a miss!
There were just 115K new jobs created in April. That’s well below the 160K that was expected.
But unemployment rate fell from 8.2% to 8.1% and last month was revised from a gain of 121K to 166K.
So it was a disappointment, but not a catastrophe due to the revisions.
Other key numbers:
- The underemployment rate has stayed flat at 14.5%
- No improvement in weekly hours.
- Average hourly earnings grew 0.2% month over month.
- The labor force participation rate has fallen to 63.6%, the lowest level since 1981.
I’m sure Dale will have more with his daily econ stats. Note how bad the underlying numbers are in the 4 bullet points. The weakness continues and continues to build.
UPDATE (Dale): I just need to offer a little correction to the quoted data above. Hourly earnings did not increase by 0.2%. Hourly earnings increased from $23.37 to $23.38. the 0.2% increase was the over-the-month percent change to the index of aggregate weekly payrolls, which is not the same thing as hourly earnings.
The following statistics were released today on the state of the US economy:
Initial claims for unemployment fell 27,000 to a much lower-than-expected level of 365,000.
Nonfarm productivity fell -0.5% in the first quarter on slower output and more hours worked. Unit labor costs rose 2.0% for the quarter.
The ISM’s non-manufacturing composite index slowed to 53.5 from 56.0 in March.
Chain stores are reporting their sales today. In general, sales have been solid, and some retailers are raising earning guidance as a result.
The Bloomberg Consumer Comfort Index fell to -37.6 from -35.8 the prior week.
The Challenger Job-Cut Report shows the layoff count rose to 40,559 in April from 37,880 in March and 36,490 last year.
Because every nation should have one. Claudia Rosett fills us in:
I’m against atrocities. I’m against genocide. I’d bet you are too.
So why is it somehow so troubling that President Barack Obama, citing a “core national interest” and “core moral responsibility” of the United States, has now ordered into existence an inter-agency Atrocities Prevention Board?
The name alone is not a good sign. With its implication of bureaucrats battling evil, it sounds like satire. An outtake, perhaps, from Graham Greene’s novel, Ministry of Fear, or Washington’s variation on Saudi Arabia’s Committee for the Promotion of Virtue and the Prevention of Vice. In editorializing last week on this new Atrocities Prevention Board, the Wall Street Journal rightly warned its readers that “this is not an item from the Onion.”
Yup, that’s me – against atrocities and genocide.
Apparently now we need government to determine what constitutes an atrocity and decide what we’ll do about it. Of course that requires a new level of bureaucracy. The formation of an atrocity committee headed by our atrocity czar. Because atrocities are now a “core national interest” and requires of government action by inclusive committee:
At least once per month, and more often in times of emergency, the Atrocities Prevention Board, or APB, will convene representatives of State, Defense, Treasury, Justice, Homeland Security, USAID, the Joint Staff, the U.S. Mission to the United Nations, the Office of the Director of National Intelligence, the CIA, and the Office of the Vice President to hammer out “the development and implementation of atrocity prevention and response policy.” The White House is calling this approach “whole of government,” and no doubt everyone will have something to toss into the pot.
I’m sure they will. First off though they have to decide what constitutes an “atrocity” don’t they?
In Libya, the U.S. led from behind to remove Gaddafi — who was a vile tyrant, but not in recent years a prime threat to the U.S. But in the case of Iran, where the regime runs global terrorist networks, is pursuing nuclear weapons, and has been threatening for years to obliterate the U.S. ally and democratic state of Israel, the Obama administration confined itself to bearing “witness” and looked to the long “arc of history,” while Iranian protesters were beaten and shot in the streets. In Syria, where the regime is in bed with Iran, the death toll now tops 10,000, after more than a year of rebellion against Assad’s brutal rule — and the U.S. looks on. And in North Korea, where the entire system of government qualifies as an atrocity, the same old Pyongyang shakedown routine has carried on, with North Korea’s 2009 nuclear test and 2012 ballistic missile test (excuse me, “satellite launch”) punctuated by U.S. offers of talks, and food aid for North Koreans whose chief obstacle to feeding themselves is that they are hostage to their country’s murderous government.
Indeed. Libya apparently qualified but not any of the others.
The bureaucracy lives and spends … and breeds. And mostly accomplishes nothing except generate meeting notes.
I wonder if they’d ever consider declaring the current governance we’re enduring an atrocity?
It would seem that would be a fairly potent means of campaigning and keeping the issues most important to the forefront. It might take care of this.
Look, one of the reasons we’re going through this “I killed bin Laden” self-congratulatory orgy right now is a day spend doing the bin Laden back pat is a day not spent on having to discuss this awful economy.
It wouldn’t be hard to compile a list of problems a new president would “inherit” from Obama. That was (and still is) an Obama strategy – blame Bush. It may be time for Romney to begin to blame Obama:
-For 8.2% unemployment
-For doubling the debt
-For anemic GDP growth
-For large increases in major regulations
-For green energy boondoggles based in crony capitalism and a nonexistent energy policy
-For increasing dependency on government
-For the first credit downgrade in US history
And, that’s just a short list.
I like the “inherit” scheme. It’s a good way to frame the debate and put the Obama campaign on the defensive. If and when the Romney campaign and certain elements of the GOP can stop shooting themselves in the foot over gay spokespersons that is.
The following statistics were released today on the state of the US economy:
The MBA reports mortgage applications rose 0.1% last week, with purchases increasing 2.9%, and re-fis falling -0.7%.
The ADP Employment Report is disappointing. ADP estimates that April private payrolls rose by only 119,000, which means Friday’s employment report may be…not good.
Factory orders fell unusually sharply in March, falling -1.5%, down from a Feb increase of 1.3%. Factory orders are pretty volatile month-to-month, but this is an especially big swing.
Mark Twain said, “A lie can travel halfway around the world while the truth is putting on its shoes.” And of course, politicians know that. So some of them use that truism to push a lie that will help them hoping that when, if ever, the truth is told, it will be moot. It is all about establishing a narrative and making it last long enough to benefit them.
The internet has made that ploy a lot more difficult. But that doesn’t mean the they don’t continue to try. Glenn Kessler at the Washington Post awards Obama’s latest falsehood their highest, or lowest depending on how you look at it, rating – four Pinocchio’s. Kessler describes that rating with a single word: “Whoppers”.
The lies have to do with decrepit bridges and, of course, Republicans. The great healer, the man who promised to change the way politics was practiced in Washington, falsely attacked his opposition – again:
“I sent them a jobs bill that would have put hundreds of thousands of construction workers back to work repairing our roads, our bridges, schools, transit systems, along with saving the jobs of cops and teachers and firefighters, creating a new tax cut for businesses. They said no. I went to the Speaker’s hometown, stood under a bridge that was crumbling. Everybody acknowledges it needs to be rebuilt. Maybe he doesn’t drive anymore. Maybe he doesn’t notice how messed up it was. They still said no. There are bridges between Kentucky and Ohio where some of the key Republican leadership come from, where folks are having to do detours an extra hour, hour-and-a-half drive every day on their commute because these bridges don’t work. They still said no.”
–President Obama, remarks to the Building and Construction Trades Department conference, April 30, 2012
You have to love the little veiled bits of populism he pitches in there – “maybe he doesn’t drive anymore”, as if Obama does.
The point, however, is every bit of that is baloney per Kessler:
Back in September, when President Obama first unveiled his jobs bill, we gave him Three Pinocchios for remarks he made regarding the aging Brent Spence Bridge on the Ohio River. The bridge connects Kentucky and Ohio, the home states of House Speaker John A. Boehner (R-Ohio) and Senate Minority Leader Mitch McConnell (R-Ky.), and it was irresistible symbolism for the White House.
The crumbling infrastructure of the nation’s bridges is certainly an important issue, but symbolism can only go so far. The administration could never explain what, if anything, the jobs bill would do to improve the Brent Spence Bridge, especially since construction was not slated to start until 2015 — and Obama’s jobs bill would spend most of its money in its first year.
Moreover, there is a long history of bipartisan support for this project, but Obama framed it as if the Republicans were blocking its reconstruction with their opposition to his legislation.
When we heard the president’s words Monday, we feared he was slipping back into his old habits. Once again he framed it as GOP opposition to fixing the Brent Spence Bridge. But then he upped the ante by mentioning other bridges “between Kentucky and Ohio” that “don’t work.” So what’s he talking about?
Of course the three Pinocchios awarded then didn’t slow him down a bit, did it. I’ve always been careful when I use the word “lie” or “liar”, because of the propensity today for people to call mistakes and the like lies. A lie is a knowing falsehood. So, after having this “mistake" pointed out previously (and don’t ever think the White House didn’t see that previous rating), Obama doubles down and throws it out there again. That, my friends, makes it a lie.
When the administration was confronted with the facts of the case, the usual prevarication began:
An administration official said the president was referring to the Sherman Milton Bridge, which actually connects Indiana and Kentucky, near Louisville. Back in September, Indiana Gov. Mitch Daniels (R) had to shut down the bridge because a 2 ½ inch crack had been discovered.
The bridge carries Interstate 64, so the bridge’s closure forced drivers to make major changes in their driving routes. Shortly after the shutdown, a Transportation Department blog declared that this bridge was “another example of why this [the president’s jobs bill] is so crucial.”
But here’s the rub: While Obama claimed “these bridges don’t work,” the Sherman Milton Bridge has already been repaired, ahead of schedule, and motorists are driving over it again.
But again, the claim is found to be baseless.
It turned out that, rather than being an example of an aging bridge, the crack that had been discovered actually had been there ever since the bridge was constructed in 1962, because of the type of steel used at the time. Other repairs were ordered, and the bridge reopened nearly three months ago — without needing any of Obama’s jobs-bill funds.
Another nearby bridge, the Kennedy Bridge, will soon undergo redecking, but officials said the work will not lead to a shutdown. Again, the work is being done without Obama’s jobs-bill money.
The facts don’t at all support the President’s statement. So what was the purpose of the lie? To cast political opponents in an unfavorable light – the usual purpose of deliberate political lies. And these were deliberate political lies.
Of course you’d think, confronted with the facts, the administration might back down a bit? But instead they apparently thought that doubling down was the best way to go:
“The President was making a point about the need to rebuild our infrastructure and the job creation opportunities that come with that, and was pointing to Ohio River area projects to illustrate the point that these kinds of projects are right in the Congressional Republican leadership’s backyards,” the administration official said.
Yup. And they were being handled by a bi-partisan state level coalition without a dollar of Obama’s “jobs-bill funds”.
Kinda stings, doesn’t it Mr. Obama?
Well done, Mr. President. A record that may be tied but never bested.
This does an adequate job of saying what needs to be said:
“Unseemly” describes it best. But when the rest of your record is so abysmal, unseemly is all you have.
The truth is that getting bin Laden was the top counterterrorism objective for U.S. intelligence since well before the Sept. 11, 2001, attacks. This administration built on work painstakingly pursued for many years before Obama was elected — and without this work, Obama administration officials never would have been in a position to authorize the strike on Abbottabad, Pakistan, that resulted in bin Laden’s overdue death.
Most reasonable people have already figured that out despite the “look I did it” claims of Obama. Critics can trash Mitt Romney all they want, but he was right – even Jimmy Carter would have made the call Obama made. And, had the operation gone wrong, despite what Bill Clinton says, the target would never have been known (until possibly, much, much later). America would have simply believed that one of hundreds of special operations that were conducted monthly, had gone south. It is war. It happens.
And, of course, what was the concern from Clinton? Politics, of course. Nothing more, nothing less.
In my youth I remember the massive May Day events staged in various communist countries and by fellow travelers in the West.
Now, it is reduced to this (not that I mind):
The irony, as you watch this bedraggled group (reported to be a whopping 200 to 300) is the one guy claiming to be the 99% even while the real 99% struggle to get past them and go to work doing productive things and not asking others for a hand-out they claim they deserve for no other reason than they exist.
And you can tell … they’re making a huge impression.
Meanwhile, in San Francisco, the usual suspects just couldn’t wait for the clock to toll midnight:
Broken glass littered several streets in San Francisco’s Mission District after protesters vandalized cars and buildings Monday night, including a police station.
The vandals were in a group that marched from Dolores Park shortly after 9 p.m., following a rally in advance of Tuesday’s planned Occupy general strike, police said. Traveling down 18th Street and onto Valencia Street, the black-clad, masked protesters smashed windows with crowbars and signs, threw paint on buildings and spray-painted anarchy symbols on the hoods of parked cars.
"All I heard was, ‘bang, bang, bang,’ and some dude had the valet sign, trying to break our window," said Adam Koskoff, manager of the Locanda restaurant on Valencia. "I didn’t even see the crowd, and I ran outside and got egged."
The vandals threw paint and eggs and smashed windows at more than 30 businesses, including Tartine Bakery at 18th and Guerrero streets and clothing store Weston Wear on Valencia.
Brilliant. Certain to win them friends and influence among those one supposes they want to impress with their message, whatever in the heck that is. Actions like this are sure to win converts. And political backing, yessir.
UPDATE: Alternative May Day observance – Victims of Communism Day.