Reuters blog archive
from Nicholas Wapshott:
President Barack Obama’s State of the Union was all about jobs. He said the word 23 times, often congratulating himself on having helped create 4 million. He urged a “year of action” to make more jobs, raise wages and create opportunities for social mobility. Then he set out on a jobs tour to persuade large companies to start hiring and pay more.
But if we assume the Tea Party-dominated House of Representatives is not going to help him here and will block any new public borrowing for infrastructure projects, what is the president to do?
Perhaps he needs to do little. The economy is slowly growing, with the number of new jobs increasing at roughly 200,000 a month, and the number of out of work Americans has been falling. The unemployment rate -- using the latest figures, from December 2013 -- shows unemployment at 6.7 percent, lower than at any time since October 2008. At its most severe, in October 2009, one in 10 Americans was out of a job.
The problem is, the jobs created since the 2008 financial collapse are paying far less than the millions of jobs lost. For many, this “new normal” suggests the recovery has been “L”-shaped -- not a bounce back to former prosperous times. With fewer workers earning less, the multiplier effect of domestic spending that can set off a true recovery is severely diminished.
from The Great Debate:
Good for President Barack Obama for emphasizing the need to restore America’s middle class. However, the actual proposals in his new summer offensive would not go very far toward that worthy goal.
America is moving, at an accelerating pace, toward an economy with tens of millions of poorly paid service jobs at one end, and a relatively small number of astronomically compensated financial jobs at the other. In between the fast food workers, who demonstrated this week for a living wage, and the hedge fund billionaires is a new creative class heavily based on the Internet. But the web entrepreneurs are too narrow a segment on which to rebuild a broad middle class.