Tag Archives: labor participation rate

Good news: Employed people up by 67,000 in June. Bad news: Unemployed people up by 347,000 in June.

Head of Federal Reserve says “As people retire, they work less.”  (Well gosh, we thought that was the POINT of retiring, so you COULD work less. Guess Janet Yellen really nailed that one…people who are retiring are working less. Better alert the media for that news flash.)

 

The civilian labor force expanded in June, adding 414,000 people, the Bureau of Labor Statistics reported today.

The number of employed people increased by 67,000 to 151,097,000 in June, but the number of unemployed people increased even more, by 347,000 to 7,783,000.

The unemployment rate ticked up two-tenths of a point to 4.9 percent.

BLS said 94,517,000 Americans were not in the labor force in June, a slight improvement from May’s record 94,708,000; and after dropping for three straight months, the labor force participation rate increased a tenth of a point to 62.7 percent in June.

In September 2015, the labor force participation rate hit 62.4 percent, its lowest point since 1977. So the June participation rate was only three-tenths of a point off its record low.

The economy added 287,000 jobs in June, the Labor Department said, a rebound from the extremely weak 11,000 (revised from 38,000) jobs added in May and the revised 144,000 jobs added in April.

In June, according to the Labor Department’s Bureau of Labor Statistics, the nation’s civilian non-institutional population, consisting of all people 16 or older who were not in the military or an institution, reached 253,397,000. Of those, 158,880,000 participated in the labor force by either holding a job or actively seeking one.

The 158,880,000 who participated in the labor force equaled 62.7 percent of the 253,397,000 civilian non-institutional population.

Last month, Federal Reserve Chair Janet Yellen told Congress the Fed is keeping a close eye on the labor force participation rate. She said she expects that rate to “continue declining in the coming years because we have an aging population.”

As baby-boomers retire, “they work less,” she noted, even though younger people “participate more.”

People who have not actively looked for work in the previous month are not counted as participating in the labor force. Yellen told Congress that “a sign of a strengthening labor market is to see people who were discouraged brought back into the labor force.”

The Bureau of Labor Statistics counted 5,692,000 people in June as “persons who currently want a job,” down from the 5,923,000 in May.

Yellen was asked last month why workers are not being hired for those millions of available jobs:

“There are an enormous number of job openings, and there is a certain degree of mismatch of workers who are looking for work with the job openings that are available,” Yellen said.

She pointed to the shift from unskilled workers to the demand for skilled labor. “The consequence of that has been rising inequality, a high return to education and downward pressure on the wages of those who are less skilled and middle income.”

 

[by Susan Jones, writing for CNS NEWS]

 

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As always, posted for your edification and enlightenment by

NORM ‘n’ AL, Minneapolis
normal@usa1usa.com
612.239.0970

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The Facts: Why this feels like a depression for most US citizens…

Depression then and now...

Everyone has seen the pictures of the unemployed waiting in soup lines during the Great Depression. When you try to tell a propaganda believing, willfully ignorant, mainstream media watching, math challenged consumer we are in the midst of a Greater Depression, they act as if you’ve lost your mind. They will immediately bluster about the 5.1% unemployment rate, record corporate profits, and stock market near all-time highs. The cognitive dissonance of these people is only exceeded by their inability to understand basic mathematical concepts.

The reason you don’t see huge lines of people waiting in soup lines during this Greater Depression is because the government has figured out how to disguise suffering through modern technology. During the height of the Great Depression in 1933, there were 12.8 million Americans unemployed. These were the men pictured in the soup lines. Today, there are 46 million Americans in an electronic soup kitchen line, as their food is distributed through EBT cards (with that angel of mercy JP Morgan reaping billions in profits by processing the transactions).

depression-2

These 46 million people represent 14% of the U.S. population. There are 23 million households on food stamps in a nation of 123 million households. Therefore, 19% of all households in the U.S. are so poor, they require food assistance to survive. In 1933 there were approximately 126 million Americans living in 30 million households. The government didn’t keep official unemployment records until 1940, but the Department of Labor estimated 12.8 million people were unemployed during the worst year of the Great Depression or 24.9% of the labor force. By 1937 it had fallen to 14.3% or approximately 8 million people.

The number of people unemployed during the 1930’s is an excellent representation of the number of households on government assistance during the Great Depression because 79% of all households were occupied by married couples with 4 people per household versus 48% married couple households today with 2.5 people per household. The unemployment rate averaged 19% during the heart of the Great Depression. Therefore, approximately 19% of all the households in the U.S. needed government assistance to feed themselves. That happens to be the exact percentage of households currently needing food stamps to feed themselves.

We are now supposedly five years into an economic recovery. The unemployment rate, according to the government, has fallen from 10% to 5.1%. Maybe a comparison to the the Great Depression in 1937, five years after the worst of it, would reveal some truth. It is not easy to do an apples to apples comparison because very few women worked outside the home in 1937 and the average life expectancy in the 1930s was 60 years old. Today, the majority of women are theoretically in the work force and the average life expectancy is 78 years old. In 1937 only 5% of the population was over 65 years old versus 13% today.

There were approximately 55 million Americans in the labor force in 1937, according to the DOL, and approximately 47 million of them were employed. So 85% of the eligible work force was working. There was no BLS to massage, manipulate, seasonally adjust, or fake the data to make things appear better than they were in 1937. Edward Bernay’s Propaganda techniques and methodologies weren’t perfected for a few more years. According to Census information there were 52 million Americans between the ages of 18 and 44, along with another 21 million between the ages of 45 and 64 in 1937. So even considering that very few women worked and many people died by the age of 60, we had a workforce of 55 million out of an age eligible population of 73 million at a maximum. That yields a participation rate of 75%.

These facts reveal the utter falsity of the propaganda drenched duplicitous data dumped by the BLS on behalf of vested interests who have captured our government and have an agenda requiring the public to be kept in the dark regarding their own dire financial situation. No matter how you slice the data, it reveals an absolute parallel to the situation during the Great Depression. There are 251 million Americans of working age and only 149 million are employed, of which 20 million are part-time and 8 million are self employed. Only 59% of working age Americans actually work. The BLS has the cajones to declare that only 157 million of the 251 million working age Americans are actually in the labor force.

This outrageous assumption flies in the face of all reasonableness, facts, and truth. In 1937, even with women not working outside the home and very few people living past 65 years old, the participation rate was 75%. Today, with the majority of women capable and willing to work and older Americans working well into their 60s, the BLS actually expects a critical thinking person to believe the participation rate is only 62.4%, the lowest since 1977. It’s a pure and simple despicable lie. The true participation rate should exceed the rate in 1937, based on the facts. Using the 75% participation rate today, yields a true unemployment rate of 21%, not the preposterous 5.1% shoveled by the BS artists at the BLS. The 21% rate ties very closely to the figure arrived at by John Williams at Shadowstats. An unbiased assessment of the facts reveals unemployment numbers and people on government assistance numbers that match or exceed those of the Great Depression.

depression-3

I also wonder whether the corporate mainstream media purposely chooses not to show pictures of the poor waiting in long lines to be fed because their function is not to report facts and truth, but to perpetuate the lie that all is well in America.  I pass the Grace Lutheran church at 36th and Haverford Avenue in West Philly everyday on my way to work. Every Thursday is when the church, in partnership with the Philabundance food bank, distributes free food to the people of West Philly. The line stretches around the block at 7:30 am awaiting the Philabundance truck to arrive. There are old, young, black, white, Latino, and Asian in the line. It looks exactly like the line pictured in the Great Depression above. I’m sure there are similar scenes across every city in America on a daily basis. People dependent on food banks and living in homeless shelters are at record levels. Where are the mainstream media pictures? How does that jive with Ben Bernanke’s self congratulatory book tour about how he saved America by secretly handing Wall Street and foreign bankers $16 trillion?

For the average American family, the US economy has been in recession since 2000, with the Greater Depression arriving in 2008. The working age population has grown by 40 million since 2000, with only 12 million jobs added over that time frame. Of those, 10 million were in the government controlled health, education, social services (HES) sectors, with millions of good paying manufacturing jobs destroyed, replaced by a couple million low paying services jobs. As David Stockman points out, Bernanke and the vested interests he serves continue to spew disingenuous propaganda  to cover up the fact average American households continue to experience depression-like conditions. When your real household income is lower than it was in 1989, while your basic living costs for food, energy, transportation, rent, housing, healthcare, taxes, and education have skyrocketed, you just might be experiencing a depression.

 

[The above article appeared recently at SHTFplan.com]

 

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As always, posted for your edification and enlightenment by

NORM ‘n’ AL, Minneapolis
normal@usa1usa.com
612.239.0970

 

 

 

 

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Many working-age men who are out of the job market are not coming back…

Another sign that our economic “recovery” is faltering.

Millions of workers who dropped out of the job market during the last economic slump were supposed to jump back in once things turned around. But more than six years after the recession ended, the missing millions are increasingly looking like they’re gone for good.

The nation’s labor participation rate — defined as the share of the working-age population that is either working or looking for work — hasn’t budged from a 38-year-low of 62.6 percent this summer. And most experts don’t see an upswing on the way.

The reasons include the nation’s aging population, swelling ranks of people on disability and the changing nature of jobs. But one of the biggest factors has to do with men in the prime of their work lives, particularly those with less education.

Labor participation for men ages 25 to 54 has been declining for decades but sped up during the recession with large-scale layoffs in construction and manufacturing. Their growing withdrawal from the job market is especially worrisome because it carries significant social and economic costs.

Collectively, these trends indicate that the U.S.’s potential workforce — and thus productive capacity — may be considerably smaller than previously thought. Some economists have long argued that the true unemployment figure is a few percentage points higher than the government-reported rate, currently 5.1 percent, because officials don’t count people as unemployed if they’re not actively looking for work.

But more and more experts are concluding that the great flight of workers in recent years isn’t going to reverse.

Meanwhile, many workers who have been able to land only part-time jobs are finding that a stronger economy doesn’t necessarily lead to more work hours. The number of part-time workers wanting to work full time remains unusually high today, and there’s some evidence that this increase since the recession is largely permanent.

JOB OPENINGS, BUT NOT JOBS

If there are millions more jobless workers than the unemployment rate would indicate, the thinking went, the Fed could keep stimulating the economy with super-low interest rates to help absorb more of the unemployed without worrying about inflation shooting higher. The Fed’s benchmark interest rate has been pinned near zero since the depths of the recession in December 2008.

But though economic growth has been slow and uneven, employers have added new jobs at a fairly steady and solid pace in recent years — about 8 million since mid-2012. The unemployment rate has fallen from a high of 10 percent in October 2009 to 5.1 percent last month, very close to what many economists see as an optimum level before inflation pressures build.

Unemployment varies widely across the country, from 4 percent or lower in many towns in Iowa and Minnesota to double digits in some places in Central California. Still, the overall improvement has been impressive. This summer, there were about 63 job openings for every 100 officially unemployed people. A few years ago it was just 16 openings for every 100.

In the past, a recovering economy usually meant rising labor participation as more people gained confidence and got off the sidelines and into the job market. But not this time. The share of the population 16 years and over in the workforce was 66 percent in December 2007 when the economy fell into recession, and it has ticked down every year since then to 62.6 percent the last three months.

If the U.S. had the same labor participation rate today as in late 2007, the nation’s workforce would be roughly 8 million higher more than the July figure of about 157 million.

YOUNG AND OLD

The severity of 2007-09 recession and major concurring shifts in the nation’s demographics have made it hard to predict labor trends. Many economists, including those at the Fed, now estimate that about half of the decline in labor participation has been due to the aging of the large population of baby boomers, the oldest of whom turned 69 this year.

Labor participation rates are lower for workers as they get closer to retirement age. And the economic downturn forced even more older workers to drop out of the labor force; anecdotal reports abound of laid-off workers taking early retirement.

At the same time, young adults have delayed their entry into the job market, further depressing labor participation. College enrollment rates were rising before the recession, and the weak recovery has pushed more people to stay in school longer while others who were laid off went back for training.

Many people not in the labor force are working off the books or at temporary jobs or as freelancers, making it difficult to track their employment status. Moreover, decades-old structural problems, including access to public transportation and affordable child care, continue to keep some workers, both male and female, from the workforce.

Many immigrants come to the U.S. for economic opportunities, and often have a higher engagement with the labor market than the native-born population. But participation rates have fallen for the foreign-born as well, as they have for almost every demographic group with the notable exception of older workers, especially those over 65.

Labor participation for women 25 to 54, which had risen steadily from the 1960s through 2000, fell back to 73.7 percent this summer from 75.5 percent in late 2007.

The drop has been sharper for men in that age group — to 88 percent from 90.9 percent at the end of 2007. At its peak in the mid-1950s, labor participation for men in their prime working age was nearly 98 percent.

WHERE ARE THE MEN?

The drop-off of men from the workforce continues to dismay policy experts and economists.

“Those are the ones I find most surprising,” said Sophia Koropeckyj, a labor economist at Moody’s Analytics. She still expects labor participation overall to rise a bit in the coming months as employers keep adding jobs and rising earnings draw more people into the workforce.

Most economists aren’t so optimistic. The aging of baby boomers, the youngest of whom are 51 this year, will be a big drag on labor participation rates for years to come. And there’s little indication yet that the decline of men in the work world has stopped.

In a paper in 2013 titled “Wayward Sons,” MIT economist David Autor said that the U.S. economic landscape was undergoing a “tectonic shift.” While women over the decades have gained ground in education and economic measures, including labor participation, men have fallen behind, Autor noted. That’s made them less attractive as partners and has perpetuated a vicious cycle in which children living in low-income single-parent households are headed predominantly by women, who in turn raise sons with poorer prospects for social, education and economic advancement.

“Although a significant minority of males continues to reach the highest echelons of achievement in education and labor markets, the median (or average) male is moving in the opposite direction,” he wrote in the paper with Melanie Wasserman, a graduate student.

That’s particularly worrisome in an economy driven by global competition and rapid changes in technology. “A male high school graduate in America has almost nothing an employer is going to value,” said Harry Holzer, a Georgetown University professor and former chief economist at the Labor Department. He noted that many men and the U.S. economy at large would benefit from stronger vocational and technical programs at schools, with apprenticeships and other career paths.

“On average, low-income, at-risk young men don’t do as well just sitting in a classroom,” Holzer said. “I think a lot of these men would do better if we offered them high-quality work-based education.”

 

[by Don Lee and Samantha Masunaga, writing for The Los Angeles Times]

 

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As always, posted for your edification and enlightenment by

NORM ‘n’ AL, Minneapolis
normal@usa1usa.com
612.239.0970

 

 

 

 

 

 

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Obama and the Fed think our economy is back on the road to health…here is the PROOF that they are dead wrong!

If you believe that ignorance is bliss, you might not want to read this article.

I am going to dispel the notion that there has been any sort of “economic recovery”, and I am going to show that we are much worse off than we were just prior to the last economic crisis.

If you go back to 2007, people were feeling really good about things.  Houses were being flipped like crazy, the stock market was booming and unemployment was relatively low.  But then the financial crisis of 2008 struck, and for a while it felt like the world was coming to an end.  Of course it didn’t come to an end – it was just the first wave of our problems.

The waves that come next are going to be the ones that really wipe us out.  Unfortunately, because we have experienced a few years of relative stability, many Americans have become convinced that Barack Obama, Janet Yellen and the rest of the folks in Washington D.C. have fixed whatever problems caused the last crisis.  Even though all of the numbers are screaming otherwise, there are millions upon millions of people out there who truly believe that everything is going to be okay somehow.  We never seem to learn from the past, and when this next economic downturn strikes it is going to do an astonishing amount of damage because we are already in a significantly weakened state from the last one.

For each of the charts that I am about to share with you, I want you to focus on the last shaded gray bar on each chart which represents the last recession.  As you will see, our economic problems are significantly worse than they were just before the financial crisis of 2008.  That means that we are far less equipped to handle a major economic crisis than we were the last time.

#1 The National Debt

Just prior to the last recession, the U.S. national debt was a bit above 9 trillion dollars.  Since that time, it has nearly doubled.  So does that make us better off or worse off?  The answer, of course, is obvious.  And even though Barack Obama promises that “deficits are under control”, more than a trillion dollars was added to the national debt in fiscal year 2014.  What we are doing to future generations by burdening them with so much debt is beyond criminal.  And so what does Barack Obama want to do now?  He wants to ramp up government spending and increase the debt even faster.  This is something that I covered in my previous article entitled “Barack Obama Says That What America Really Needs Is Lots More Debt“.

Presentation National Debt

#2 Total Debt

Over the past 40 years, the total amount of debt in the United States has skyrocketed to astronomical heights.  We have become a “buy now, pay later” society with devastating consequences.  Back in 1975, our total debt level was sitting at about 2.5 trillion dollars.  Just prior to the last recession, it was sitting at about 50 trillion dollars, and today we are rapidly closing in on 60 trillion dollars.

Presentation Credit Market Instruments

#3 The Velocity Of Money

When an economy is healthy, money tends to change hands and circulate through the system quite rapidly.  So it makes sense that the velocity of money fell dramatically during the last recession.  But why has it kept going down since then?

Presentation Velocity Of M2

#4 The Homeownership Rate

Were you aware that the rate of homeownership in the United States has fallen to a 20 year low?  Traditionally, owning a home has been a sign that you belong to the middle class.  And the last recession was really rough on the middle class, so it makes sense that the rate of homeownership declined during that time frame.  But why has it continued to steadily decline ever since?

Presentation Homeownership Rate

#5 The Employment Rate

Barack Obama loves to tell us how the unemployment rate is “going down”.  But as I will explain later in this article, this decline is primarily based on accounting tricks.  Posted below is a chart of the civilian employment-population ratio.  Just prior to the last recession, approximately 63 percent of the working age population of the United States was employed.  During the recession, this ratio fell to below 59 percent and it stayed there for several years.  Just recently it has peeked back above 59 percent, but we are still very, very far from where we used to be, and now the next economic downturn is rapidly approaching.

Presentation Employment Population Ratio

#6 The Labor Force Participation Rate

So how can Obama get away with saying that the unemployment rate has gone down dramatically?  Well, each month the government takes thousands upon thousands of long-term unemployed workers and decides that they have been unemployed for so long that they no longer qualify as “part of the labor force”.  As a result, the “labor force participation rate” has fallen substantially since the end of the last recession…

Presentation Labor Force Participation Rate

#7 The Inactivity Rate For Men In Their Prime Working Years

If things are “getting better”, then why are so many men in their prime working years doing nothing at all?  Just prior to the last recession, the inactivity rate for men in their prime working years was about 9 percent.  Today it is just about 12 percent.

Presentation Inactivity Rate

#8 Real Median Household Income

Not only is a smaller percentage of Americans employed today than compared to just prior to the last recession, the quality of our jobs has gone down as well.  This is one of the factors which has resulted in a stunning decline of real median household income.

Presentation Real Median Household Income

I have shared these next numbers before, but they bear repeating.  In America today, most Americans do not make enough to support a middle class lifestyle on a single salary.  The following figures come directly from the Social Security Administration

-39 percent of American workers make less than $20,000 a year.

-52 percent of American workers make less than $30,000 a year.

-63 percent of American workers make less than $40,000 a year.

-72 percent of American workers make less than $50,000 a year.

We all know people that are working part-time jobs because that is all that they can find in this economy.  As the quality of our jobs continues to deteriorate, the numbers above are going to become even more dismal.

 

#9 Inflation

Even as our incomes have stagnated, the cost of living just continues to rise steadily.  For example, the cost of food and beverages has gone up nearly 50 percent just since the year 2000.

Presentation Food Inflation

#10 Government Dependence

As the middle class shrinks and the number of Americans that cannot independently take care of themselves soars, dependence on the government is reaching unprecedented heights.  For instance, the federal government is now spending about twice as much on food stamps as it was just prior to the last recession.  How in the world can anyone dare to call this an “economic recovery”?

Presentation Government Spending On Food Stamps

So you tell me – are things “getting better” or are they getting worse?

To me, it is crystal clear that we are in much worse condition than we were just prior to the last economic crisis.

And now things are setting up in textbook fashion for the next great economic crisis.  Unfortunately, most Americans are totally clueless about what is going on and the vast majority are completely and totally unprepared for what is coming.

 

[by Michael Snyder, writing for The Economic Collapse Blog]

 

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As always, posted for your edification and enlightenment by

NORM ‘n’ AL, Minneapolis
normal@usa1usa.com
612.239.0970

 

 

 

 

 

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Labor force participation rate is much more useful than unemployment rate…

NORM ‘n’ AL Note: Why work when the government will take care of you?

Have you noticed that Mr Obama is now touting the nation’s declining unemployment rate? For him doing so is good politics, but only because the American public is naïve enough to believe politically-motivated distortions and half-truths. When liberal politicians brag about unemployment statistics, thinking people should remember what Mark Twain said about statistics: “There are lies, damn lies, and statistics.” Statistics are easily manipulated—a fact that certainly applies to the unemployment rate; hence its current popularity with liberal politicians.

The American public tends to think that a declining unemployment rate means that more people are finding jobs. This is not necessarily the case. It can also mean and does currently mean that: 1) unemployed people have become so frustrated with their fruitless job search that they have given up and are no longer counted in the statistics reported by the Bureau of Labor Statistics; and 2) people have found jobs but these jobs are part-time or a step-down from the jobs they lost. In other words, they are under-employed. The Labor Department is aware of these two possibilities and even collects data on them. These data are used to produce what the Bureau of Labor Statistics calls the U6 unemployment rate. While President Obama proudly extols the nation’s 6.7 percent unemployment rate, he studiously avoids revealing that the U6 unemployment rate is more than 14 percent (I think it actually exceeds 20 percent).

The U6 unemployment rate provides a more accurate picture of the true unemployment situation—which is why liberal politicians avoid using it—but even it provides an incomplete picture. To get a complete and accurate picture of the unemployment situation, it is necessary to also consider the labor participation rate. The labor participation rate indicates the percentage of people of working age who are actually working. Unfortunately, that percentage has declined steadily since 2000 and experienced its biggest drop during the six years of the Obama administration. A declining labor participation rate is bad news for America because it means there are fewer people paying the taxes that finance an ever-growing government bureaucracy. The obvious and inevitable result of this imbalance is higher taxes for those who are working.

The current labor participation rate is at an all-time low of just 63.2 percent. In other words, of all the people in America who are of working age, only 63.2 percent are actually working. This being the case, the functional question becomes: Why is the labor participation rate so low? Liberals try to cover over the sad truth by offering up such pearls as the replacement of people in the workforce by technology. Although this accounts for a small percentage of the problem, the fact is that in spite of technological advances thousands of jobs go unfilled everyday—particularly in the technology sector—because unemployed people either lack the necessary skills or simply do not want to work.

The real reasons the labor participation rate has fallen so precipitously are these: 1) The so-called safety net provided by the government in the form of extended unemployment benefits has become not a safety net but a magic carpet that the less motivated among the unemployed have learned to ride instead of going back to work; 2) Government entitlement programs have made it convenient and easy to get by without working; 3) There is no longer any shame in being on welfare (EBT cards have taken away the inconvenience and embarrassment of handing food stamps to a cashier); 4) People are choosing to drop out of the labor pool due to discouragement; and 5) People have learned how easy it is to defraud the government and collect disability pay.

The long and short of the decline in labor force participation is this: Why work when the government will take care of you? Why indeed? This entitlement mentality has taken hold of the American psyche and created an attitude toward work that will only continue the decline in labor force participation. But this decline represents a one-way street that will eventually lead to an economic disaster. The time will come and is coming when we will have more people riding in the wagon of America’s economy than pulling it. When that happens, those who have made a career out of living off the government will be the first to drive over the cliff, and the government will not be there to hand out parachutes because it will be too broke to afford them.
[by David L. Goetsch, writing for PATRIOT UPDATE]

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As always, posted for your edification and enlightenment by

NORM ‘n’ AL, Minneapolis
normal@usa1usa.com
612.239.0970

 

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