Why Is There Record Long-Term Unemployment?

[Moonglow]

Thursday, March 1, 2012

Why aren’t many people who have been unemployed for more than six months able to get jobs?

Analysts say the long-term unemployment numbers now haven’t been this high since the Great Depression. Is it because they’ve become dependent on unemployment as some on the political right would say? Or is it because their skills are outdated they need training as many on the left would say?

According to new research, it’s neither.

read more Why Is There Record Long-Term Unemployment? | Here & Now

Companies and investors demanded lower taxes and got it, now we have seen the folly of such lobby efforts.

 

[KevinWestern]

Why Is There Record Long-Term Unemployment

OBAMA

View attachment 18283

Record long term unemployment is an effect of the huge stock market crash and housing bubble explosion that occurred in 2006-2008, not Obama. Maybe he could have done a better job combating it these past few years, but the powerful market forces that have perpetuated the recession are far more powerful and beyond the control of any single government official. Remember, when Obama took office the economy was loosing 700,000 jobs a month! That sort of disastrous environmental downslide will take at least a decade to recover from (at least a decade) ; no President - Republican or Democrat - has a secret magic wand that can make everything "better again".

We had too many jobs in 2006; the economy had overextended itself, and many homes and businesses that shouldn't have been built were being built. And when I say "shouldn't have been" built I mean that there was no (real) money to pay for it. There was a lot of credit, and a lot of bad loans that were never going to be paid back. So when the whole house of cards collapsed, people naturally lost their jobs. You think President can solve this dilemma - one maybe 20 or 30 years in the making - in just a few short years? Especially when there's also 100 other Senators and 400+ other Representatives who have their own view/say in the matter?

But go ahead, blame Obama, I know it's the easy thing to do....

If it's absolutely necessary for you to find a scapegoat, I suggest you look earlier to the root cause of the banking disaster; perhaps those behind repealing the "Glass-Steagall Act" in the early nineties. But even that is the handiwork of multitudes of individuals - Republicans and Democrats alike.


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[KevinWestern]

Steve Jobs says he moved iPhone manufacturing to China because:

1.) Chinese laborers are able to mobilize much more quickly than US laborers, and can react to last minute changes to apple products (ie you can recruit 8,000 workers in a matter of hours at 2am if need be).

2.) A much larger pool of "mid-skill" level employees in China vs America. Our US education system is evidently leaving some gaps.

the article alleges "low demand for labor". Such is too general, obfuscating the specific fact of "low demand for [US] labor" -- i.e. US labor is not economically desirable, by price (minimum wages), skills (mid-level), etc.

US labor will "wait around until the economic environment favors them again"; or "adapt & change to the new economic environment"; or "go extinct". Evolution comparisons are valid. Anything that helps US labor be more economically "adaptable" would be a positive economic contribution.

(Perhaps willing workers could be employed, at Minimum Wage; work full-time in reality; work part-time "officially" ?)

Yes, but what Steve Jobs pointed out - interestingly - is that there's much more to the move to China then just cheap labor.

Cheap labor becomes much more important when we're talking about low cost things like batteries, or socks. Which are you more likely to purchase - $3 Chinese socks or $13 USA socks? Definitely the Chinese socks. But would you really care dishing out an extra $10 or $20 (to pay for more expensive labor) when you're purchasing a $1,700 Apple computer? Probably not...

I think there's some things about the Chinese labor market that we really won't be able to combat against. One example is the fact that the Chinese are willing to live on site at the factory in dorms, and get called to work in a moments notice - even at 3am - if need be. Try getting Americans to do that; it won't work (and thank God, because I would never want to have to live that type of life).

But there are some things that we can combat against - for instance the example of mid-skill level education. Right now the educational structure is largely (a) college or (b) no college. College is often the bridge to high skill jobs, no college is often leads you to low skill jobs.

Where's that third option of going to perhaps a technical school? I think high-schoolers are taught that College is the only way to go, and that you should feel shame if you don't attend, when in fact we should saying that you can also go down the very honorable route of attending a technical school or apprenticeship to learn a skilled trade with your hands. We need to get better at opening up other options besides college, and making them known to those in the 16-18 age range.
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[The Infidel]

Thursday, March 1, 2012

Why aren’t many people who have been unemployed for more than six months able to get jobs?

Analysts say the long-term unemployment numbers now haven’t been this high since the Great Depression. Is it because they’ve become dependent on unemployment as some on the political right would say? Or is it because their skills are outdated they need training as many on the left would say?

According to new research, it’s neither.

read more Why Is There Record Long-Term Unemployment? | Here & Now

Companies and investors demanded lower taxes and got it, now we have seen the folly of such lobby efforts.

We have one of, if not the highest corporate taxes in the world... try again dummy.

 

[Moonglow]

Thursday, March 1, 2012

Why aren’t many people who have been unemployed for more than six months able to get jobs?

Analysts say the long-term unemployment numbers now haven’t been this high since the Great Depression. Is it because they’ve become dependent on unemployment as some on the political right would say? Or is it because their skills are outdated they need training as many on the left would say?

According to new research, it’s neither.

read more Why Is There Record Long-Term Unemployment? | Here & Now

Companies and investors demanded lower taxes and got it, now we have seen the folly of such lobby efforts.

We have one of, if not the highest corporate taxes in the world... try again dummy.

U.S. corporate taxes that were actually paid (the effective rate) fell to a 40 year low of 12.1 percent in fiscal year 2011, despite corporate profits rebounding to their pre-Great Recession heightshttp://thinkprogress.org/economy/2012/03/30/456005/reminder-corporate-taxes-very-low/?mobile=nc

 

[Widdekind]

mid-skill level education. Right now the educational structure is largely (a) college or (b) no college. College is often the bridge to high skill jobs, no college is often leads you to low skill jobs.

Where's that third option of going to perhaps a technical school? ... the very honorable route of attending a technical school or apprenticeship to learn a skilled trade with your hands

why put so much "guesswork" into educating Labor? why not employ "extended on-the-job training"? if workers knew why they were learning some skill(s); then they would be more motivated to complete their training? naively, Americans are investing heavily in "extraneous education", which winds up being economic "waste"; as if the sensed as much, many students "drop out" of Public education, that they evidently deem to be "a waste of time".

(by extrapolation, the Chinese business model, of Labor living on site, provides an economical venue, for room, board, educational training, e.g. "no cost of commuting"; future jobs, e.g. "deep-sea oil rigs", "space factories", could possibly require Labor to live on-site, i.e. "workers go to where the work is")

 

[Widdekind]

We have one of, if not the highest corporate taxes in the world...

U.S. corporate taxes that were actually paid (the effective rate) fell to a 40 year low of 12.1 percent in fiscal year 2011...

and corporate taxes, in foreign countries, could still be even lower.

Global Finance Magazine states that corporate taxes have decreased, world-wide, over the last decade:

The highest marginal tax rates in 2009 were found in the United Arab Emirates—at 55%; Uganda—at 45%; Japan—with a 41% tax rate; Libya—at 40%; and the United States, which also had a 40% highest marginal tax rate for corporations. The lowest corporate tax rates were seen, unsurprisingly, in those countries known as offshore corporate tax havens—including the Cayman Islands, Bermuda, The Bahamas, and the Isle of Man. They all had a top marginal corporate tax rate of 0%—along with Bahrain.

There was a big shift in marginal tax rates between 1999 and 2009. Most countries dropped their highest corporate tax rate over that period, and some of the biggest top tax bracket reductions were seen in Germany—which went from 52.3% to 29.4%; Iran—which went from 54% to 25%; Saudi Arabia—which dropped to 20% in 2009 from 45% in 1999; and Kuwait, which went from 55% down to 15% in 2009.

 

[hortysir]

Easy.


We have record long-term payments

 

[itfitzme]

Remind us again how you DON"T defend Obama.

that is not defending Obama.
I was just pointing out how you attack Obama for the stuff that happened under your beloved Bush's watch.
Obama has carried on with most of the same principles Bush had. They both suck.
I just like pointing out partisan hypocrisy.

Do you deny that lots of jobs were offshored under Bush's watch too?

Wrong as usual, Bush did not sign a statement that would close down over 100 power plants and effect the coal industry. Bush did not shut down twice a pipe line that would bring in 20000 long term jobs. And until the dems took over Congress Bush had what is legally described as FULL employment. Bush tried to stop the Housing collapse as well and was defeated twice by Democrats one of whom went on national TV just a month or two before the collapse and INSISTED that the only danger to the Housing market was more regulations.

Bush did not propose increasing taxes on corporations to force them out of business and out of the Country either. Obama has.

Quit defending Obama or admit you do it.

1) There are are 13,430,000 laborforce. There are an additional 6376000, not in the labor force, want a job now. That is 19,806,000. That is 20 million.

20,000 is one one thousenth of the total. It is meaningless to answer the question.

 

[itfitzme]

Bush tried ...

I am so glad he tried.

 

[itfitzme]

Rep. Michele Bachmann (R-MN) as one of the loudest critics. After the last day of Supreme Court hearings about the health care reform law, Bachmann told Fox News’ Sean Hannity that people are uninsured not because they can’t afford insurance, but because they simply choose to be uninsured

Yep, the choose to be uninsured because they cannot afford it.

 

[TakeAStepBack]

We have the highest corp. tax rate in the world and a failing currency. Doing business here is not enticing, so they move elsewhere. Couple that with wage laws, insurance mandates, state sponsored monopolies adn what do you expect?

 

[itfitzme]

Heidi Shierholz, economist at the non-profit, non-partisan Economic Policy Institute told Here & Now’s Robin Young that the underlying cause of long term unemployment is much larger. “It’s not a worker skills problem, it’s not that people are taking vacation on their UI [un-employment insurance] benefits. It’s because there is very weak demand for workers,” she said.

Yeah that's right. Now why is there very weak demand for workers? That's really the question, isn't it?

I have been curious as to how the standard of living has been going. I finally decided to accept the personal consumption expenditures portion of the GDP as being close enough. It isn't an absolute measure, but it is good enough to compare the relative change over time.

What I was really wondering about is how the standard of living changed for people that are working. We can be reasonably sure that the per capita standard of living falls during a recession. The question is, what happens to the standard of living for the employed population. Does it fall or is the decrease entirely on the backs of the newly unemployed.

I think we can make a good guess, but just to be sure, here is the real dollar per capita and per worker personal consumption expenditures.

I did both the long decade trend and the trend bracketing the recession.

And, of course, the standard of living for the employed remained relatively steady. On a working person basis, it took a bit of a deceleration, then rebounded.

As a proxy measure is suffers a bit. But that is the problem with macro economic information, it all suffers a bit.

Obviously, by whatever means it comes about, the long term unemployed, disabled, elderly, institutionalized, military, and homeless are consuming some portion of that total personal consumption expenditures. Somehow, those that are working do produce enough for the unemployed and disabled to scrape by. It would be nice to be able to separate consumption out by income level, employment, even adjust it for quality.

Still, it is telling. What appears to be an aggregate decrease, when examined from the perspective of the total population, nearly disappears when examined from an employment perspective. If you didn't know there was a recession in there, you would hardly notice.

If you think about it, when the economy recedes, the change in the standard of living is insulated in impact from those remaining on the employment rolls and ever further insulated in impact as income level increases. And of course it does. Demand falls, production cuts back, the labor force is trimmed, and income per working person remains the same. In fact, one might wonder if the recovery in standard of living happens from the top down.

Beyond the initial shock of the housing bubble burst, it should be fairly clear that the reduction in demand caused the recession. There is another view, when looking at consumer credit, that makes it clear that it is a deceleration of consumption that initiated the recession.

If Say's law applied, there would be no recession. If supply side worked, there would be no recession. If supply creates it's own demand, given that supply was up, then demand would have been up and no recession would have occurred.

Demand fell, GDP fell, and not because of a lack of production capacity. It fells for lack of demand. Then the workforce was trimmed, investments and capital as well, as necessary. And it was trimmed until the economy settles into a new stable balance. We need, after all, only two percent of the workforce, or about one percent of the population, to grow sufficient food.

The reason we have such long term unemployment is because we have an oversupply of labor given the demand. And, we always do. If not for a bubble, technology, housing or otherwise, the economy doesn't need to employ everyone. It is stable right where it is. The standard of living for the employed continues to increase without a decrease in the employment to population ratio. (I've got another graph of that.)

If you think the economy sucks, it depends on what we mean. It doesn't really. It's just a smaller economy. The functional economy, that existed in 2006, is simply smaller now. It just sucks for that portion that are no longer a part of it.