Tag Archives: employment

A Brighter Outlook for America’s Unemployed

Summary: Following up yesterday’s post (the good news is that the bad news about the economy is wrong), we have a cheerful view of the economy.

Sunrise

A Brighter Outlook for America’s Unemployed

by John Ridlehoover of the VA Home Loan Centers

Over the last several years, the unemployment rate in the United States has been in a state of flux. In 2008, the United States saw a low unemployment rate of only 4.7%. After the collapse of Wall Street and the U.S. housing bubble burst in 2009, the unemployment rate had grown to around 10.1%. In 2010, the number of unemployed Americans was roughly around 6.8 million, which was the peak of unemployment.

A large unemployment rate puts a halt on the economy of a country as a whole. The more unemployed citizens mean the less consumer spending there will be. Consumer spending and the building of new businesses are keys to growing an economy.

During the first few months of the year, the economy fell 0.7%. Economists believe this drop to be caused by the extreme winter we had this year. The winter weather caused everything to slow down, including US ports.

Though America has seen dark times as far as unemployment, May and June of 2015 have shown strong job growth in some time. With over 470,000 jobs created, the number of unemployed citizens fell from close to 7 million to 2.5 million. Chief economist at Bank of the West in San Francisco, Scott Anderson, has said about the current job market, “Job growth roared back to life in May.”

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Why Japan can become an economic star of the 21st century

Summary:  Today we look at the future of Japan, and speculate at how well it will cope with the new industrial revolution. Their unique strengths (sometimes wrongly considered weaknesses) suggest that the 21st century might see the sun again rising over Japan. America too will face this challenge; we should watch and learn from Japan.   {1st of 2 posts today. It is a revised version of posts from 2013 and 2014}

Contents

  1. A falling population is a boon for Japan
  2. A new Industrial Revolution
  3. Japan: suited to be a star of the 21st Century
  4. For More Information

 

(1)  A falling population is a boon for Japan

Japan’s government has worried about its overpopulation since the Meiji Restoration when they had about 3 million people (1868). They encouraged emigration to Korea, to no effect. They had 50 million in 1910, 100 million in 1967, and a peak in 2008 at 128 million — all crowded into a narrow urban belt along the coast. At their current level of fertility, by 2100 their population might be half of today’s, back to the level of 1930.  If fertility continues to fall, population might fall to 60 million (1925) or even 50 million (1910).

The effect on Japan’s environment would be wonderful. Japan could become a garden with the cleaner technology of that future era (a common question in grade-school history will be “Teacher, what is ‘pollution’?”).

See this graph showing the coming evolution of the age distribution in Japan (source; see more information from their National Institute of Population and Social Security Research).

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Happy Meals: now made with 20% less people!

Summary:  By now everybody sees that a new industrial revolution has begun, but few clearly see its dynamics. This post looks at one example: the debate about wages. Raise wages or lower them, it makes little difference compared to the new technology that does jobs both cheaper and better.  {1st of 2 posts today.}

Minimum Wage Meme: False

 

Funny but false, showing a deep misunderstanding of how automation works…

 

Mike Konczal demolishes fantasies about a post-work world in his rebuttal to Derek Thompson’s article in The Atlantic (discussed here yesterday): “The Hard Work of Taking Apart Post-Work Fantasy” at the Roosevelt Institute. However, he believes several false elements of consensus thinking, such as this: “If wages are stagnant or even falling, what incentive is there to build the robots to replace those workers?

Economist Gregory Clark gives an example showing why that’s false in A Farewell to Alms: A Brief Economic History of the World (2007)…

There was a type of employee at the beginning of the Industrial Revolution whose job and livelihood largely vanished in the early twentieth century. This was the horse. The population of working horses actually peaked in England long after the Industrial Revolution, in 1901, when 3.25 million were at work. Though they had been replaced by rail for long-distance haulage and by steam engines for driving machinery, they still plowed fields, hauled wagons and carriages short distances, pulled boats on the canals, toiled in the pits, and carried armies into battle.

But the arrival of the internal combustion engine in the late nineteenth century rapidly displaced these workers, so that by 1924 there were fewer than two million. There was always a wage at which all these horses could have remained employed. But that wage was so low that it did not pay for their feed.

Horses then, people now. New technology allows machines to do their jobs cheaper and better. McDonald’s shows how this works as they install kiosks allowing people to enter their own orders. They’re already used at “McDonalds in Switzerland“. In the US they’re being tested where “The McDonald’s of the future lets you customize your burgers“.

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Three visions of our future after the robot revolution

Summary: During the past 2 years the robot revolution has come into view, and all but Right-wingers living in fantasy-land have begun to realize it might (like the previous ones) produce large-scale social disruption and suffering. But to prepare for these changes we must first image what kind of world they’ll create. Here we look at three visions about what lies ahead for us.  {1st of 2 posts today.}

“We did not come to fear the future. We came here to shape it.”
— Barack Obama’s speech to Congress, 9 September  2009.

Dark futures

 

Contents

  1. The center-left sees the problem
    ……and offers mild solutions.
  2. Realistic analysis and prescriptions.
  3. Visions of dark futures.
  4. For More Information.

 

(1)  The center-left sees the problem and offers mild solutions

Slowly, people have come to see the coming robot revolution (aka, a new industrial revolution), even economists. The Left has adopted this issue, as they have climate change, as a means to enact long-sought changes in the US economy. Like climate change, their solutions are far too small for the problem described.

(a) A World Without Work” by Derek Thompson in The Atlantic, July/Aug 2015 — “For centuries, experts have predicted that machines would make workers obsolete. That moment may finally be arriving. Could that be a good thing?” Typical of The Atlantic. Long, meandering, confused mish-mash of issues. Never confronts the core issue of how people will earn money to live. Lots of nonsense about people living by selling crafts to each other.

(b) The Future of Work in the Age of the Machine” by Melissa S. Kearney, Brad Hershbein, and David Boddy at the Hamilton Project, February 2015. See the slides and transcript from the seminar they held for academics and businesspeople. Their prescription is aggressive application of conventional methods…

The Project’s economic strategy reflects a judgment that long-term prosperity is best achieved by fostering economic growth and broad participation in that growth, by enhancing individual economic security, and by embracing a role for effective government in making needed public investments.

(c) The future of work in the second machine age is up to us” by Marshall Steinbaum at the Washington Center for Equitable Growth, 23 February 2015 — They show that the robot revolution has not yet appeared in the macroeconomic statistics. But it’s coming. Their conclusions are the standard center-left recipe, like those of the Hamilton Project…

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The bottom line of the May employment numbers

Summary: The strong May employment number confirms what I’ve said in previous reports about the economy, casting doubt on the bears’ confident forecasts of an imminent recession. The economy was slow in Q1, but the data so far for Q2 paints a stronger if still mixed picture. {1st of 2 posts today.}

Economy

Contents

  1. Summary of this important report.
  2. Where were the jobs?
  3. Wages and hours.
  4. For More Information.

 

(1)  Summary of this most important economic number

The May employment data was clearly and broadly strong. See the BLS’ Highlights report for the pictures. BLS revised the gains in March and April by +32,000 and estimated that total nonfarm payroll employment rose by 280,000 in May. This compares with an average monthly gain of 207,000 over the past 3 months and 251,000 over the prior 12 months.

Keep a sense of proportion about these numbers. There are 140 million jobs in America, done by 147 million employed workers. The monthly changes are small and so difficult to measure accurately. Watch the patterns instead; ignore those who obsess over the tiny wiggles in May’s numbers. They are mostly statistical noise. For jobs the overall pattern was strong, but not a breakout.

Job gains through May 2015

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Look at immigration policy to see our government respond to its masters

Summary: Immigration has been one of the most fascinating issues in American politics, revealing the influence of our elites over not just the government but also the experts and media that guide public policy. A new report shows past trends — revealing hidden causes of our problems — and points to a new future for America.  {2nd of 2 posts today}

Immigrants as fraction of US population

Graph of US Census data, prepared by the Center for Immigration Studies, April 2015. See Census graphs here.

Using data from US Census reports, the Center for Immigration Studies reveals some powerful trends (see their report for sources and methodology) …

  • Total net immigration (the difference between the number coming and going) will increase steadily over the next 45 years, totaling 64 million.
  • Absent a change in current policy, the Census Bureau projects that in 2023 the nation’s immigrant population (legal and illegal) will reach 14.8% (51 million) of the total U.S. population — the highest share ever recorded in American history.
  • The bureau also projects that the immigrant population will grow nearly four times faster than the native-born population, reaching 15.8% (57 million) of the nation’s population in 2030, 17.1% (65 million) in 2040, and 18.8% (78 million) in 2060.
  • To place these numbers into historical context, as recently as 1990, immigrants were 7.9% (20 million) of the total U.S. population.
  • The nation’s total population will grow to 417 million by 2060 — 108 million more than in 2010. This increase is roughly equivalent to adding the combined populations of California, Texas, New York, Florida, and Massachusetts to the country.
  • The new projections indicate that, absent a change in immigration policy, immigrants who will arrive in the future plus their descendants will account for roughly three-fourths of future U.S. population increase.

What effect will this have on America?

“{this body of excess workers} forms a disposable industrial reserve army …  a mass of human material always ready for exploitation.”
— Marx’s Das Kapital, expanding upon Friedrich Engels’ insight. They got a few things right.

A four-fold increase in immigrants as a fraction of the total population creates a severe shock to America, even when occurring over 90 years. That would take us beyond the point at which massive popular opposition forced “closing the door” in the early 20th century: the Immigration Act of 1917, the Emergency Quota Act (1921), and the Immigration Act of 1924. FDR reduced immigration to trickle during the Great Depression.

With the supply of cheap labor restricted, the foundation for a large middle class was laid. Unions were able to gain traction and wages began the long rise. Of course corporations immediately began to undermine these accomplishments. By 1970 their efforts began to bear fruit: unions were weakening, immigrants began to grow as a fraction of the population, and wages stagnated. By 1990 unions were crushed, immigrants flooded in with few limitations, and real wages for the unskilled plummeted.  Supply rising faster than demand.

We can expect more of all three trends as the 1% continues to gain power.

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The vital things to know about the latest employment report

Summary: The March employment report is important, confirming the slowing of the US economy. This post skips our usual numbers blizzard, focusing instead on the vital numbers, and debunking both the hype and hysteria about this most important of the economic statistics. {1st of 2 posts today.}

Economy

Contents

  1. Summary of this important report.
  2. Has Obama’s recovery helped the middle class?
  3. The bottom line.
  4. Does this signal a recession coming soon?
  5. For More Information.

 

(1)  Summary of this, the most important economic number

The March employment report was one of the worst in the past 3 years. See the Highlights for the pictures. Nonfarm payroll employment increased by 126,000 in March and 197,000 per month over the past 3 months — compared to 269,000 over the prior 12 months. This slowing is consistent with that of the other economics indicators in the past month.

Keep a sense of proportion about these numbers. There are 140 million jobs in America, done by 147 million employed workers. The monthly changes are small and so difficult to measure accurately. Watch the patterns instead.

Employment trend as of March 2015

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