from David Rohde:
Yes, we’re creating jobs, but how’s the pay?
Update: The December job numbers released this morning continued the same trend described in yesterday’s column. Of the 200,000 new jobs created last month, 78,000 – or nearly 40 percent -- were in transportation, warehousing and retail, sectors known for low pay and seasonal hiring. In a far more positive sign, manufacturing gained 23,000 workers in December after four months of little change. A vast expansion of that trend would benefit the middle class tremendously.
WASHINGTON -- Between now and November, middle class Americans are going to hear an enormous amount of bragging about job creation.
Mitt Romney will tout his role in the creation of Staples, The Sports Authority and Domino's, three firms that he says created 100,000 jobs. Barack Obama will say 2.9 million jobs have been created since March 2010, and highlight a surge of 140,000 new private sector jobs in November.
The central question for middle class Americans, however, is: What quality of job is being created? The November job surge, for example, occurred primarily in retail, leisure and hospitality, sectors known for low wages. The other high-growth areas were professional services and health care, where higher education is a central determinant of income. Manufacturing and construction, one of the few areas left in the American economy where members of the middle class without elite educational pedigrees can find strong wages, were moribund. The following chart from the Bureau of Labor Statistics breaks down the numbers.
In a rare moment of bipartisan agreement, Republicans and Democrats both recognize the problem. After years of Democratic politicians complaining about a lack of social mobility for Americans, The New York Times reported this morning that Republican candidates are complaining about the problem as well.
Presidential candidate and former Pennsylvania Senator Rick Santorum warned this fall that movement “up into the middle income is actually greater, the mobility in Europe, than it is in America,” according to The Times. Wisconsin Congressman Paul D. Ryan, a leading House conservative, recently wrote that “mobility from the very bottom up” is “where the United States lags behind.”
The income mobility myth
By David Callahan The opinions expressed are his own.
Top Republicans have a simple answer to surging public concern about America’s vast wealth divide: More income mobility. “We want success for everybody,” House Majority Leader Eric Cantor said last week, adding that Americans shouldn’t “excoriate some who have been successful.” This remedy for economic unfairness taps into the popular American belief that public policy should ensure equality of opportunity, not outcome.
Too bad it won’t work.
Changes in the economy mean that, no matter how hard people work or how much they invest in education, they may still find themselves barely treading water. Even before the financial crisis, there weren’t enough good jobs to go around – thanks to globalization, automation, declining unionization, and lax labor standards. The majority of new jobs created during the presidencies of Bill Clinton and George W. Bush were low-wage positions with no benefits. These trends – not, say, a lack of ambition – help explain why half of all American households bring in under $50,000 and have no assets.
“Success for everybody” is simply not possible against this backdrop of structural inequality. Ironically, conservatives like Cantor are placing ever more faith in the great American virtues of hard work and self-improvement even as these virtues deliver less and less mobility.
Once upon a time, for example, Americans with a strong work ethic but little education could move upward thanks to unionized manufacturing jobs. But as both manufacturing jobs and unions started to disappear in the 1970s, earnings of high school-only males fell off a cliff: declining by 15 between 1973 and 1989. Today, about a third of poor families with children include a parent who is working full-time.
Realizing that plain hard work doesn’t mean upward mobility anymore, Americans have been piling into college at record levels – only to find that a degree is no magic ticket to success, either. Pay for college educated males has largely stagnated over the past few decades while living costs have soared. For example, nearly all the modest income gains of middle income families between 1999 and 2009 were eaten up by rising healthcare costs. Increasingly, too, white collar jobs are disappearing in the same way that blue collar jobs did – being shipped overseas or eliminated by technology or reclassified as temporary with no benefits.
The important data needed to verify how the US is being damaged by wealth concentration is not ‘income mobility’ but ‘wealth mobility.’
Income mobility suggests nothing that can be solidly verified but wealth mobility can.
DerekHaas, forget that treasury.gov thing and google ‘wealth mobility.’
What happens after Obama’s jobs bill dies?
By Nicholas Wapshott The opinions expressed are his own.
You can add to the list of hollow cries from history–such as “Ban the Bomb!” and “Bring the Troops Home!”–the president’s favorite refrain, “Pass the Jobs Bill Now!” Like the rest, Obama’s oft repeated demand is a sham, a mere slogan. Neither he nor his party, and certainly no Republican, believes Congress is going to pass even a small part of the bill, for it combines two elements his opponents detest the most: public works and higher taxes on the rich.
While the GOP squabbles over which of a barely electable field to pick as its candidate, Obama has already begun his reelection campaign in earnest. The simple message he is taking on the road is that Congress should “pass the jobs bill now!” That’s a plea he knows is sure to be ignored, leaving him in a position, he believes, to blame persistent joblessness on the Republican obstructionists. He is onto something. As Jimmy Carter found out, Americans hold their presidents to account when the economy is tanking; they expect them to improve the economy and are prepared to fire them when they don’t. It is a lesson for conservatives who believe that governments can’t and shouldn’t attempt to change the economic weather. Voters blame the government anyway, whether they intervene or not.
Obama, like Franklin Roosevelt, believes in trying to fix the symptoms of a broken economy, while his GOP opponent, whoever it turns out to be, must hold to the Hayekian orthodoxy insisted upon by the Tea Party and the Republicans’ fiscally conservative wing that there is nothing much governments can or should do to improve the economy and that stimulus spending either does not work at all or will only make the smallest of differences in the short term. As Obama gleefully knows, a rival promising austerity, the long haul, a far worse economy before it gets better, and a dim light at the end of a long, long tunnel will be running against the spirit of optimism that Americans feel and like to hear from their leaders.
Obama’s American Jobs Act is a thinly disguised second Keynesian stimulus designed to pump $450 borrowed billions into the economy to raise aggregate demand and give jobs to some of the 9.3 percent of Americans out of work. Obama’s task is to convince the American people that stimuluses work. The results of his first hurried stimulus, all $814 billion of it, are mixed. It set off a burgeoning cottage industry among conservative economists taking it in turns to prove that the stimulus did nothing or little to improve growth or job creation. Take Alan Reynolds of the Cato Institute: “There’s no evidence for the theory that state spending has shortened this or any other slowdown.” Or this, from John F. Cogan and John B.Taylor, of the Hoover Institution: “Beware of politicians proposing public works and other government purchases as a means to stimulate the economy. They did not work then and they are not working now.”
It is easier to show that Obama’s initial stimulus did not work well – the money went to pay off private debt, or went into private savings, or was spent on foreign goods, or replaced state and local government borrowing with federal government handouts – than the broader point: that stimuluses don’t work in any circumstances. So, will Obama’s stimulus work? We will never know, because it will not be enacted. If the president is reelected he will have to propose a new stimulus to suit the conditions of November 2012.
That leaves a whole year for his economic advisers to come up with a stimulus that works. There can be no excuse next time that the stimulus was flawed because to avert an imminent economic crisis it had to be brought in quickly without adequate planning. There is no need to find elusive “shovel ready” public works projects that can be started immediately as there is a whole year to find and design job-creating schemes that will not entail pouring billions into the sand. There is a whole year to find ways of giving cash only to those who will spend it on other Americans, not blow it on foreign consumer goods or hoard it as has happened the last time.
After the disaster of GWB he had the right plans to deal with the problems, but he was to nice, he tried to find consensus, he should not have…..In his road towards the next election he should include a lot of the principles behind the occupy movement, in my opinion that will strike home with a hell of a lot of American people. And he should go back to his initial plans for job creation and push them hard, after all he can now straight forward GOP and right wing democrats for the failure to do just that. May-be he could also bring forward the idea of doing away with lobbying, which after all is legal corruption.
The case for Obama’s jobs program
By Betsey Stevenson The opinions expressed are her own.
What should we make of the President’s new jobs plan? Ignore the politics — will it pass? — and focus on the economics: If it does, will it get Americans back to work?
The centerpiece is a series of sharp payroll tax cuts. The usual problem with payroll taxes is that they largely subsidize existing workers. But this plan — three separate payroll tax cuts — is different.
The first tax cut is the most innovative: No payroll taxes at all for firms increasing their wage bill. In economics, all the action is at the margin. If we want people to do more at the margin — hire more people — then the incentives to do so should be targeted at the margin. We will get much more bang-for-our-buck by giving the biggest tax breaks to the hiring of extra workers.
Second, there’s bigger cuts targeted at small business. The logic here is simple: these are the firms whose hiring is most likely constrained by their cash-flow.
Third, the package extends and expands the current payroll tax cuts for workers which would otherwise have expired at the end of the year. Tax cuts for low income folks generate substantial further spending. In ordinary times middle class families usually don’t spend as much of each extra dollar, but these aren’t ordinary times. With one-in-eight families directly affected by unemployment last year, it’s likely they’ll be a bit more likely to spend the extra money. And even if people don’t spend the extra dollars, it will help them work off the debt overhang that is holding back spending.
Beyond payroll tax cuts, there’s infrastructure spending. There’s a good case that more roads, better schools and improved Internet access are a good long-term investment. Better to do it today when we have so many construction workers to build these things, than to wait until later when the cost will be higher. And with negative real interest rates, there’s no case for delay — these investments will simply never be this cheap again.
What another half a Trillion dollars? Ya, we could cut a check to millions of Americans for $100,000.00 dollars each, but we wouldn’t be exercising our right to redistribute wealth to our favorite speciula interest now would we! Let’s spend, gamble our way out (call it progressive) and if we fail our kids should bring a pretty penny at auction! We’ll change when we hit bottom!
The jobs proposal ignores economics
By David Callahan The opinions expressed are his own.
It’s a cruel fact for millions of unemployed Americans that the jobs plan President Obama unveiled last night will never be fully enacted by Congress. What’s even crueler, though, is that the least effective elements of the plan have the best chance of passage. New direct federal spending, the most powerful form of stimulus, is widely considered DOA on Capitol Hill – while weaker tax cut options will get a real hearing.
That’s not how things would go if mainstream economists were calling the shots. Economics is not an exact science, but economists do have pretty good models to predict what “fiscal policy multipliers” will be most effective at stimulating growth and new hiring. Just last month, for example, the chief economist for Moody’s Analytics Mark Zandi released an analysis of stimulus measures work. Zandi advised John McCain in 2008 and is anything but a committed liberal. But his study, supported by the full weight of Moody’s modeling expertise, clearly shows that spending is the best form of stimulus.
The single most effective form of stimulus, the study found, are increased outlays for food stamps — which create $1.71 in economic activity for each dollar in federal spending. The other top two boosters are spending on unemployment benefits and infrastructure. Earlier studies, including by the Congressional Budget Office, have found largely the same thing.
Now, in case you didn’t notice, President Obama did not stand up last night and call for massive new spending on food stamps. While he did call for new infrastructure investments and again extending unemployment insurance, these were not the largest elements of his plan. Instead, the biggest ticket item by far – estimated to cost $244 billion – is an expanded payroll tax holiday for both workers and employers.
The only reason Obama is putting so many eggs in this basket is that a payroll tax cut is said to have a fighting chance in Congress, given that Republicans backed a holiday last year. But make no mistake: the appeal here is political, not analytical.
According to the Moody’s study, each dollar lost by the Treasury due to a payroll tax cut to workers will create $1.27 in new economic activity and the cuts for employers will create just $1.05 in activity.
“robb1:
I called my television dish and got somebody in the Philippines.
I Called HP & got customers service from Costa Rica.
I called a major Credit Card company and talked to someone in India.
All those jobs, and they r thousands of them, could be better done by American Citizens and Legal Residents in the US, earning US $ and spending, paying taxes in the US.
Tax outsourcing.”
Have you ever considered the Unions have jacked the cost of wages to astronomical amounts and the Americans want more and more to do less and even less. I am an American working in Dubai. They have every nationalitie in the world working here and the nationals from India, Philippines, Pakistan and Sri lanka work for about $100 per week and most work 12 hour days. Please tell me how companies can afford to pay the Americans they amounts they demand without jacking up the costs? Until Americans lower their expectations on salary jobs will continue to be had abroad. Come join us, living in a foreign country sucks but I have a job!!!!!
The middle-class meltdown
This is a response to Don Peck’s book excerpt, “How chronic joblessness affects us all.” Labor economist Gary Burtless also responded here.
By John Lloyd The opinions expressed are his own.
“All that is solid melts into air,” wrote Karl Marx in the Communist Manifesto. He meant that the sheer, revolutionary power of capitalism had wrenched larger and larger parts of the world out of its feudal or tribal doze, and sent it running round the track of modernization, smashing down habits, customs, faiths as it went. The agents of this wrenching change: the middle classes, or as he would have it, the bourgeoisie, the new class which grew in the womb of feudalism, and then destroyed it. And they would, he prophesied, be destroyed in their turn.
Do you not fear, in anxious moments at dawn, that he was right, just a bit (163 years: the Manifesto came out in 1848) before his time? Do you feel the solid world melting? Do you tremble that we in the rich states are living, not just on borrowed money, but also on borrowed time – and that it is running out? That our way of life is being gnawed at from below?
John Gray, the British philosopher, once a Thatcherite, thinks Marx is right, and that the melting has gone beyond effective political control. Marx was wrong, to be sure, about communism producing a decent society, judging by what’s been on offer so far. But Gray thinks he was right about how the apparently triumphant bourgeoisie, builders of a productive, industrial, city-based society, would themselves melt. “The weapons,” Marx wrote, “with which the bourgeoisie felled feudalism to the ground are now turned against the bourgeoisie itself.” The constant churn and change which capitalist development required would, in the end, attack those who had created the process: the middle classes. Now they – we – are for churning.
Our fate has become linked to that of the classes we thought we had left, or left behind. The industrial working class in the rich societies, whom Marx thought would lead the revolution, is now small, and in most states the trade unions are weakened, as are the socialist parties. Those in what Marx called the “lumpenproletariat” are growing in numbers, and can be dangerous – see the London riots in August. But they are also disorganized. In an article in London’s Guardian earlier this week, the UK Justice Secretary Kenneth Clarke called the rioters a “feral underclass” and said they were “cut off from the mainstream in everything but its materialism.”
But is there also a feral overclass which sets the materialist tone and style? In the United States, a growing number of economists see society separating more and more into the rich and the poor, with a middle squeezed down and out. As Don Peck writes on Reuters.com and in his sober piece in The Atlantic: “the most important economic trend in the U.S. over the past couple of generations has been the ever more distinct sorting of Americans into winners and losers…the recession has pressed hard on the broad center of American Society.” Peck quotes Emmanuel Saez, a Berkley economist, as saying that “the rich seem on the road to recovery,” while the jobs for those in the middle “are being wiped out. And what will be left is a hard and a pure market.”
Thanks for sharing – Acetracy. I find that succinct analysis to be extremely insightful, and would explain many, many things. That is going to be my working hypothesis from now on and I will see how well it holds up.
Why the unemployed stay unemployed
This is a response to Don Peck’s book excerpt “How chronic joblessness affects us all.”
By Gary Burtless The opinions expressed are his own.
First, from a labor economics perspective Peck’s analysis is basically correct. In modern capitalist labor markets, long-term unemployment tends to feed on itself via the mechanism that Peck describes. It gets increasingly difficult for the unemployed to get re-employed the longer their unemployment lasts. (There are some hard statistics showing this is true, and that it is true regardless of the state of the economy.) The impact of this phenomenon on the overall unemployment rate became clear in 1980s Western Europe. Countries like France, Germany, Denmark, and Italy that had enjoyed unemployment rates below those in the U.S. for much of the previous three decades found themselves with jobless rates higher than those in the U.S. More worryingly, their unemployment rates stayed above the U.S. rate for a very long time.
It became clear than much of the difference was the gap between the two continents in long-term unemployment (that is, joblessness that lasts longer than 6 months or a year). Europeans who remained in unemployment longer than 6 or 12 months tended to stay unemployed, sometimes up until the age they qualified for an old-age pension. Even when the European job market improved, these unfortunates stayed unemployed. Employers hired from the ranks of already-employed workers (i.e., those who were on other employers’ payrolls) or from new graduates. They tended to shun the long-term unemployed.
Second, it appeared that the European long-term unemployed eventually failed to exert any downward influence on European wages. It was almost as though these unfortunates had become invisible to employers, unions, and governments in the wage-determination process. The availability of millions of willing – but long-term-unemployed – workers did not restrain unions in their wage demands or employers in their willingness to offer higher overall wages. What became clear by the second half of the 1980s was that when European economies started to improve, wage gains also started to rise – in spite of the fact that there were still millions of long-term unemployed workers who would have been happy to fill new job openings at wages below the prevailing wage rate.
Third, one popular theory at the time to explain this kind of hysteresis (i.e., the tendency of high unemployment rates to persist for a long time) was that the skills of long-term unemployed workers atrophied the longer they were without work. Economists said there was “structural unemployment,” by which they meant that the long-term unemployed no longer possessed the skills needed for the industries and occupations that were expanding. My own explanation is a bit different. I believe that when the job-seekers’ queue is very long (as it is when the unemployment rate is 7 percent or higher), employers can be very choosy about who to hire. They can indulge many of their prejudices about which job candidates are most likely to be productive workers and which are most likely to be losers. A candidate who’s been unemployed 6 months, 9 months, or, God help him, 12 months or longer looks like a very bad bet – even if the truth is the opposite.
There is a young economist at Texas A&M named Joanna Lahey who conducted a very clever experiment showing that employers discriminate against job candidates older than, say, age 50, even when the older applicant’s qualifications are precisely the same as a younger candidate’s. If Lahey re-ran her experiment to see how often employers respond to job applications from workers with identical job qualifications, but with different spells of unemployment (say, 0 weeks, 5 weeks, 15 weeks, 26 weeks, 39 weeks, and 52 weeks), I’m pretty confident she would find that employers are much less likely to respond to the job applications of people who have been unemployed the longest. This behavior is not entirely irrational on employers’ part (especially when they’re receiving 50 job applications for each opening). But their screening method means that many of the long-term unemployed will thoughtlessly be denied access to dozens of jobs for which they are perfectly suited (or even “over”-qualified).
I agree completely with Don. The mindless pursuit of profit eventually bites the profit seeker in the hand. Also, the tendency for employers to summarily reject workers who are not currently employed should be outlawed for the sake of the misfortunate as well as everyone else. The most optimistic result for society is to have to bear the cost of disposing of the dead that litter the landscape. A burden on society that should be imposed on the corporate community who refused to think independently and simply threw the older worker and or long term unemployed under the bus. Without giving a thought to the fact that that person earned a right to be productive.
How would Keynes advise Obama on jobs?
By Nicholas Wapshott The opinions expressed are his own.
It’s still the economy, stupid. So if Obama wants to keep his job – and we must assume he does, though he doesn’t seem to be enjoying himself much — he must boost the economy and get the jobless back to work. No president since 1948 has been elected with a jobless figure higher than 7.2 per cent, so with unemployment currently running at 9.1 per cent, he looks headed for certain defeat.
Add the pivotal fact that two of his core groups of supporters, blacks and hispanics, suffer disproportionately from joblessness, at 16.2 per cent and 11.6 per cent respectively, and the president’s prospects look even dimmer. With the White House admitting there is little chance unemployment will fall before the election next year, the president needs some good advice on how to get people back to work, and fast.
What would John Maynard Keynes tell Obama? He once advised Franklin Roosevelt on how to cure unemployment, but he didn’t make much headway. “I saw your friend Keynes,” FDR told his Labor Secretary Frances Perkins. “He left a whole rigmarole of figures.” In turn, Keynes told Perkins he had “supposed the president was more literate, economically speaking.”
Keynes won’t find Obama knows much about economics either, but the founder of macroeconomics was a great charmer and would applaud the president for heading in the right direction with his 2009 stimulus. He would temper his praise, however, by saying the trillion dollar injection into the economy was far too small to do much good and in many cases went to the wrong people and was spent on the wrong projects.
To get a domestic benefit from a public spending boost, the president needed to funnel money towards Americans who would pass it on, not give it to the wealthy, who stashed it away or bought themselves foreign-made luxuries, nor those who used it to pay off their credit card bills. Keynes’s famous “multiplier,” by which every dollar spent is worth far more as it is passed from hand to hand, doesn’t work if the cash is placed under a mattress.
So what should the president do next, now that he lost the mid-terms and finds himself confronting a hostile Congress dominated by a vociferous minority who will not countenance raising taxes or adding to the national debt? Keynes would remind Obama that there are three ways to pump money into an ailing economy to bolster demand and fuel the spending that businesses need to invest and expand.
“Keynesianism/Central Economic Planning and the Federal Reserve are to blame for the economic crisis. ” – EyesofVigilance
Really, because I thought Supply-Side Economics had been pretty much dominating Washington for the past 30 years? You remember, Voo-Doo economics. That’s where everything gets deregulated (like banks, OTC trading, derivatives markets, etc) and corporation get huge tax breaks so they can more easily hire and produce. Then, the rewards were supposed to rain down on the middle-class and poor. A trickle down effect as some would say.
What has the REAL outcome been?? Three near collapses of financial markets in less than 25 years due to unregulated greed (Saving & Loan, Long-Term Capital, and the TARP bailout). Of course all three collapses were avoided thanks to massive tax payer bailout programs. Oh, and let’s not forget stagnate wage growth for the middle and lower classes.
How chronic joblessness affects us all
This is an excerpt from “Pinched: How the Great Recession Has Narrowed Our Futures and What We Can Do About It.”
By Don Peck The opinions expressed are his own. Last summer, the phone maker Sony Ericsson announced that it was looking to hire 180 new workers in the vicinity of Atlanta, Georgia. But the good news was tempered. An ad for one of the jobs, placed on the recruiting website the People Place, noted the following restriction, in all caps: “NO UNEMPLOYED CANDIDATES WILL BE CONSIDERED AT ALL.”
Ads like this one have been popping up more frequently over the past year or so; sometimes the ads disappear once the media calls attention to them (a spokesperson for Sony Ericsson said its ad was a mistake). But new ones continue to appear.
The prohibition against the unemployed applying for jobs is an unjust by-product of the desperation of many unemployed Americans, who have inundated companies with applications, sometimes indiscriminately. And it also shows the extent to which this is still a buyer’s market, in which employers can afford to be extraordinarily selective. But these restrictions may portend something more enduring, as well. Temporary unemployment can become permanent after a time; companies sometimes ignore people who have been out of a job for a year or two, and the economy—somewhat shrunken—just moves on without them.
The economic term for this phenomenon is hysteresis, and it can be one of the worst consequences of a very long recession. When people are idle for long periods, their skills erode and their behavior may change, making some of them unqualified even for work they once did well. Their social networks shrink, eliminating word-of-mouth recommendations. And employers, perhaps suspecting personal or professional dysfunction even where it is absent, may begin to overlook them en masse, instead seeking to outbid each other for current or recently unemployed workers once demand returns. That can ultimately lead to higher inflation, until the central bank takes steps to depress demand again. The economy is left with a higher “natural” rate of unemployment, a smaller working population, and lower output potential for years to come.
The blight of high unemployment that afflicted much of Europe in the 1980s and ’90s is a case in point, and an important cautionary tale. The persistence of high unemployment resulted from several factors, including overly rigid labor markets in some countries and welfare programs that dulled the incentive to find a job in many others. But analysis by the Johns Hopkins economist Lawrence Ball reveals that much of it was the result of hysteresis caused by a long period of disinflation and weak demand in the early and mid-1980s. In some countries, the natural rate of unemployment rose by five to nine percentage points.
The scars from this period will be deepest for the unemployed, but they will be felt by most of us. Communities marked by high, persistent unemployment devolve over time; social institutions wither, families disintegrate, and social problems multiply. Many American inner cities still bear scars from the sudden loss of manufacturing, and the attendant rise in male unemployment, in the 1970s. Parts of Europe now struggle with a burgeoning underclass. When geographically concentrated, idleness and all its attendant problems are easily passed from one generation to the next.
There are many jobs out there and many qualified applicants. It is too bad that there are hiring managers that do say that candidates need to be currently employed. Many of the unemployed are through no fault of their own and are missing out on some good talent.
High unemployment and the education deficit
The following is a guest post by Bruce Yandle, distinguished adjunct professor of economics with the Mercatus Center at George Mason University and dean emeritus of the College of Business & Behavioral Science at Clemson University. The opinions expressed here are his own.
Last month’s report on U.S. employment growth brought no cheer to job-seekers with a high school education.
In June 2010, the unemployment rate for adults 25 or older with a high school diploma was 10 percent. Whereas unemployment among college educated adults was 4.4 percent. (Overall unemployment was 9.5 percent.)
Part of what’s making the unemployment number so high, aside from a dismal economy, is an education deficit. The idea of lining up shovel-ready jobs with stimulus money may sound good, but our economy is not a shoveling one. Instead, our economy is calling for a more educated workforce.
The gap between the U.S. unemployment rate for Americans with high school diplomas and those with college degrees shot through the roof with the Great Recession (See figure 1). Because of this education deficit, the overall unemployment rate will not sink anytime soon.
Of course, a four-year degree is not the only route to improving employment prospects. Adults with a two-year technical education do far better than those with just a high school education. The June unemployment rate for that group of adults was 8.2 percent.
Since December 2009, some 593,000 jobs have been filled in the nation’s economy, including 163,000 in manufacturing. While each job is important, the numbers look pale against the 7.9 million jobs that have disappeared since December 2007, when the recession started.
Okay guys and gals to attack the author on the premise that education is the cure-all is rather simple though many of you bring up good points, some very good. But what we should really attack his premise on are his facts; take the graph that he uses or that he mentions that the stimulus money was spent on a select few sectors of the economy.
In the graph the author looks at the difference in unemployment between Collage Graduates (CG) and High School Graduates (HSG), but what he fails to point out at 4.4% unemployment that would put CGer’s at the top point of what most economists would call normal or seasonal unemployment rates(usually 2 to 4% for normal job turnover rates). So when the government used OUR money for the so-called stimulus/ Job Creation Bill; well, it was politically skewed in favor to the progressives favored segments of the work force, not those that needed the help most or those most hurt by the Recession.
Nor does he mention that Colleges and Universities have become nothing more than wealth transfer vehicles, from the Middle Class to the Social Elites at the Schools. Where costs have grown exponentially since the ‘70’s with no real increase in net worth of their product.
Really sad when you think about it that we have let this happened for so long.
I have to chuckle when I read folks complaining about outsourced jobs while these same people are making ‘bang for the buck’ decisions as consumers. Connect the dots people! Your decisions as consumers are pushing companies to do the very thing you complain about. As consumers, we tend to reward those companies that offer the best ‘bang for the buck’ with our business. As investors we demand that companies grow sales and cut costs. As all this is happening, we complain about the behavior of ‘ruthless’ companies. Just silly!