Opinion

The Great Debate

High unemployment and the education deficit

graduation photo USE THISThe 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.

In praise of Latin American immigrants

The United States owes Latin American immigrants a debt of gratitude. And Latin American immigrants owe a debt of gratitude to lawmakers in Arizona. How so?

Thanks largely to immigration from Latin America (both legal and illegal) and the higher birth rates of Latin immigrants, the population of the U.S. has kept growing, a demographic trend that sets it apart from the rest of the industrialized world, where numbers are shrinking. That threatens economic growth and in the case of Russia (U.N. projections see a decline from 143 million now to 112 million by 2050) undermines Moscow’s claim to Great Power status.

A country’s population starts shrinking when fertility falls below the “replacement rate” of 2.1. births over the lifetime of a woman. For white American women, that rate is around 1.8 now. For Latin American immigrants, the rate is 2.8. According to the U.S. census bureau, nearly one in six people living in the U.S. are Hispanics. By 2050, they are projected to make up almost a third of the population.

Unemployment to stay above 10 percent in 2010

morici– Peter Morici is a Professor at the Smith School of Business, University of Maryland, and former Chief Economist at the United States International Trade Commission. The views –

The economy continues to bleed jobs, even as GDP rebounds. Employment may be a lagging indicator, but job losses should have abated by now even if a lot of new jobs are not being added.

Coming off a deep recession, GDP growth should have been much stronger than the 2.8 percent recorded in the third quarter. A poorly conceived and badly executed stimulus package and the failure to correct structural problems that caused the Great Recession are holding down growth.

A paradox of plenty – hunger in America

Bernd Debusmann–  Bernd Debusmann is a Reuters columnist. The opinions expressed are his own. –

Call it a paradox of plenty. In the world’s wealthiest country, home to more obese people than anywhere else on earth, almost 50 million Americans struggled to feed themselves and their children in 2008. That’s one in six of the population. Millions went hungry, at least some of the time. Things are bound to get worse.

This the bleak picture drawn from an annual survey on “household food security” compiled by the U.S. Department of Agriculture (USDA) and released in mid-November. It showed the highest level of food insecurity since the government started the survey, in 1995, and provided a graphic illustration of the effect of sharply rising unemployment.

Getting a summer job: Entrepreneurship for teens

diana-furchtgottroth–- Diana Furchtgott-Roth, former chief economist at the U.S. Department of Labor, is a senior fellow at the Hudson Institute. The views expressed are her own. –-

It’s July, teen unemployment has risen to 24 percent, and you—or your teenage children—still don’t have a summer job. This is a peculiarly American problem.

In Nepal, according to Hudson Institute research assistant and Nepalese citizen Astha Strestha, “teens just hang around all summer and spend their parents’ money.”

What will the climate change bill do to your job?

diana-furchtgottroth–- Diana Furchtgott-Roth, former chief economist at the U.S. Department of Labor, is a senior fellow at the Hudson Institute. The views expressed are her own. –-

Next Thursday, just in time for the July 4 holiday weekend, America’s unemployment rate is forecast to rise from 9.4 percent to 9.6 percent, well above rates in other industrialized countries.

Yet today the House of Representatives is rushing to pass the American Clean Energy and Security Act of 2009, even though the bill was incomplete yesterday and congressmen have not yet had the opportunity to analyze it. The bill would send America’s unemployment rate even higher.

Double-edged sword in pay cuts

Christopher Swann– Christopher Swann is a Reuters columnist. The views expressed are his own –

This recession is introducing many Americans to a novel experience — the pay cut.

Fifteen percent of employers surveyed by the Society of Human Resource Management reduced pay in the past six months — a threefold increase from earlier this year. Companies like Hewlett-Packard, Caterpillar and the New York Times have taken the pruning shears to wages.

What to expect from Friday’s jobs report

morici — Peter Morici is a Professor at the Smith School of Business, University of Maryland, and former Chief Economist at the United States International Trade Commission. The views expressed are his own. –

On Friday, the Labor Department will report employment data for May. In April, the economy lost 539,000 jobs, and the consensus forecast is for another 550,000 jobs lost in May. My forecast is for a 561,000 loss.

In Friday’s jobs report the key variables to watch are:

Jobs Creation. May 8 the Labor Department reported the economy lost 539,000 payroll jobs in April, down from 699,000 in March. However, a significant part of this improvement was a surge in temporary Census Bureau positions. The private sector still lost more than 600,000 jobs. In recent weeks, new unemployment claims have remained stubbornly above 600 thousand, and my forecast is 561,000 jobs lost in April.

Even if the economic contraction slows in the second and third quarters, job losses above 400,000 appear likely for the next several months. Job losses will top 7 or 8 million before the hemorrhaging ends.

An equal opportunity recession?

Jim CarrJames H. Carr is chief operating officer for the National Community Reinvestment Coalition, a Washington-based association that promote access to basic banking services for America’s working families. He is a member of the Insight Center for Community Economic Development’s “Experts of Color Clearinghouse”. The views expressed are his own.

The U.S. economy is unraveling at a pace not seen in decades. The more than 650,000 jobs lost last month has contributed to a growing concern that the unemployment rate could rise to 10 percent or higher before the economy rebounds. At the center of the economy’s instability is a foreclosure crisis that has claimed 3.5 million homes in the last year alone, and threatens the loss of an additional 8 to 10 million homes to foreclosure over the next five years.

The loss of wealth associated with the collapse of the housing market is staggering. More than $5 trillion in housing equity has virtually evaporated since the foreclosure crisis began. Major stock indexes have also been cut in half, further contributing to decreased consumer confidence, substantially reduced spending, lower productivity, rising unemployment and additional foreclosures.

Rising unemployment gravest threat to U.S. and UK

John Kemp Great Debate– John Kemp is a Reuters columnist. The views expressed are his own –

Rising unemployment is the now the largest single threat to attempts to stabilize the banking system through recapitalization and assets swaps designed to remove toxic assets from bank balance sheets.

It is also the main impediment to restarting bank lending, renewing output growth and preventing debt-deflation becoming entrenched.

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