Job growth over the last five years is the weakest on record. The US economy came up more than 7 million jobs short of keeping up with population growth. That’s one good reason for controlling immigration. An economy that cannot keep up with population growth should not be boosting population with heavy rates of legal and illegal immigration.
Over the past five years the US economy experienced a net job loss in goods producing activities. The entire job growth was in service-providing activities--primarily credit intermediation, health care and social assistance, waiters, waitresses and bartenders, and state and local government
S manufacturing lost 2.9 million jobs, almost 17% of the manufacturing work force. The wipeout is across the board. Not a single manufacturing payroll classification created a single new job.
The declines in some manufacturing sectors have more in common with a country undergoing saturation bombing during war than with a super- economy that is “the envy of the world.” Communications equipment lost 43% of its workforce. Semiconductors and electronic components lost 37% of its workforce. The workforce in computers and electronic products declined 30%. Electrical equipment and appliances lost 25% of its employees. The workforce in motor vehicles and parts declined 12%. Furniture and related products lost 17% of its jobs. Apparel manufacturers lost almost half of the work force. Employment in textile mills declined 43%. Paper and paper products lost one-fifth of its jobs. The work force in plastics and rubber products declined by 15%. Even manufacturers of beverages and tobacco products experienced a 7% shrinkage in jobs.
Of the new jobs, 26,000 (about 13%) are tax-supported government jobs. That leaves 181,000 private sector jobs. Of these private sector jobs, 177,000, or 98%, are in the domestic service sector.
Here is the breakdown of the major categories:
• 30,000 food servers and bar tenders;
• 28,000 health care and social assistance:
• 12,000 real estate;
• 6,000 credit intermediation;
• 8,000 transit and ground passenger transportation;
• 50,000 retail trade; and
• 8,000 wholesale trade.
(There were 7,000 construction jobs, most of which were filled by Mexicans immigrants.)
Not a single one of these jobs produces a tradable good or service that can be exported or serve as an import substitute to help reduce the massive and growing US trade deficit. The US economy is employing people to sell things, to move people around, and to serve them fast food and alcoholic beverages. The items may have an American brand name, but they are mainly made off shore. For example, 70% of Wal-Mart’s goods are made in China.
Where are the jobs for the 65,000 engineers the US graduates each year? Where are the jobs for the physics, chemistry, and math majors? Who needs na university degree to wait tables and serve drinks, to build houses, to work as hospital orderlies, bus drivers, and sales clerks?
If you really want to understand what makes the U.S. economy tick these days, don't go to Silicon Valley, Wall Street, or Washington. Just take a short trip to your local hospital. Park where you don't block the ambulances, and watch the unending flow of doctors, nurses, technicians, and support personnel. You'll have a front-row seat at the health-care economy.
For years, everyone from politicians on both sides of the aisle to corporate execs to your Aunt Tilly have justifiably bemoaned American health care -- the out-of-control costs, the vast inefficiencies, the lack of access, and the often inexplicable blunders.
But the very real problems with the health-care system mask a simple fact: Without it the nation's labor market would be in a deep coma. Since 2001, 1.7 million new jobs have been added in the health-care sector, which includes related industries such as pharmaceuticals and health insurance. Meanwhile, the number of private-sector jobs outside of health care is no higher than it was five years ago.
Between 1979 and 2004, real gross domestic product (GDP) per person
in the United States increased about 60 percent. This report asks how well the U.S. economy has done translating this economic growth into good jobs.The report defines a “good” job as one that offers decent pay (at least $16 per hour or about $32,000 per year), employer-paid health insurance, and a pension. In 2004 (the most recent year for which data are available), only 25.2 percent of American workers had a job that met all three criteria.
In both 1979 and 2004, about one-fourth of workers were in jobs that
qualified as “good” by the definition used here. The basically unchanged good jobs rate across the two years suggests that the economy has failed to convert long-term economic growth into an expanding supply of good jobs. After controlling for improvements between 1979 and 2004 in the “human
capital” of the U.S. workforce —American workers today are, on average, older and much better educated than they were at the end of the 1970s— the economy now produces 25 to 30 percent fewer good jobs than it did 25 years ago. In 2004, about one-fourth (26.6 percent) of Americans were in “bad” jobs, defined as a job that pays less than $16, has no employer-provided health insurance, and no pension. This is close to the share of Americans in bad jobs in 1979 (27.9 percent).
The short answer is “not very well.” If we define a “good” job as one that pays at least $16 dollars per hour, offers health insurance that is at least partly paid by the employer, and provides a pension plan, then the share of U.S. workers in good jobs hardly changed between 1979 (24.6 percent)
and 2004 (25.2 percent), despite the 60 percent increase in income per
person over the same period. More importantly, if we control for significant improvements in the human capital of the U.S. workforce —today’s
workforce is, on average, significantly older and much better-educated than the country’s workforce at the end of the 1970s— the economy’s ability to generate good jobs has actually fallen by about 25 to 30 percent.
American workers have enjoyed the benefits of both strong job growth and rising wages during the Clinton–Gore administration. Wage inequality began to decrease and real wages began to rise during the late 1990s, following two decades of increasing wage inequality and stagnating average wages.
Since the end of World War II, real wages for production workers have risen by more than half. Most of this growth occurred, however, in the 1950s and 1960s. (See chart 2.1.) After reaching a peak in 1973, real hourly earnings for production workers either fell or stagnated for two decades. During 1996– 1998, growth in hourly earnings resumed, accelerating to over two percent in 1998.
For many workers, the stagnating wages of the last quarter century were offset in part by growth in expenditures for other employer-provided compensation, such as healthcare and pension benefits. Dollars spent on benefits grew more rapidly than those spent on wages and salaries during most of the 1980s and the first half of the 1990s, accounting for 28 percent of total compensation in 1995. Beginning in 1995, the benefit portion of workers’ compensation grew more slowly, as employers increasingly chose to offer less expensive types of health care and pension plans in order to minimize the growth of labor costs.2
Stagnating real wages and cutbacks in other compensation, however, do not necessarily mean stagnating income and living standards. In fact, real family income for most Americans has risen, although slowly, over the past quarter century, reflecting the dramatic rise in two-earner families and the increase in the number of hours many families work.
Average family incomes fell in the USA from 2001 to 2004, pulled down by a sluggish recovery from the downturn and the sharp stock market drop, the Federal Reserve said Thursday. The decline — the first since 1989-92 — was accompanied by the smallest increase in net worth in that period.
In its comprehensive Survey of Consumer Finances, released every three years, the Fed said the median net worth of the bottom 40% of families declined, while those at the top saw gains. The percentage of families investing in stocks fell 3.3 percentage points to 48.6% from 2001 to 2004, a level last reached some time between the 1995 and 1998 surveys.
Real net worth — the difference between family assets and liabilities — rose only slightly from 2001 to 2004. Median net worth rose only 1.5% to $93,100 during the period, vs. a 10.3% gain from 1998 to 2001. And liabilities rose faster than assets, due largely to a big rise in mortgage debt.
Of course, both under Clinton in the 1990s and Johnson in the 1960s, there were severe problems with the way low unemployment was attained. Because workers had experienced the "heightened sense of job insecurity" under most of Clinton's tenure, when wages did finally start to rise significantly in 1997, this was from an extremely low base. Moreover, the injection of increased spending under Clinton that produced low unemployment came from the stock market bubble which, as has now become transparently clear, was unsustainable. In the 1960s, the catalyst driving the economy to full employment was government spending on the Vietnam war-that is, a source of economic stimulus that was also unsustainable and even more undesirable than the 1990s market bubble.
Among other evidence, Friedman reports on a 2000 study by Human Rights Watch that documented the exploding rate at which workers in the U.S. face job discrimination, harassment and discharge for attempting to form unions. In the 1959s, only hundreds of workers suffered such reprisals. But by the 1990s, just the number of cases recognized by the National Labor Relations Board had risen to over 20,000 per year. Clearly, advancing an egalitarian policy agenda will not be sustainable unless employers and government regulators respect workers' fundamental rights to organize themselves as they wish. Indeed, the very notion of an egalitarian policy project absent this basic right is a contradiction in terms.
Since 1975, practically all the gains in household income have gone to the top 20% of households.
Wages have been flat or declining on average for 5 years now. As the Financial Times story points out, we have had 5 years of economic growth, but the amount the median American worker earns every week has fallen by 3.2 per cent, adjusted for inflation, since the start of the recovery in November 2001. For the first time ever, the real wages of American workers have declined through more than four years of strong growth. Calculations by NDN show that the average American earned $480 a week when President Bush came to office. Controlling for rising prices, the average American still earns exactly $480 today. So while the American economy has been growing, the incomes of most Americans have been standing still.
How have Republicans responded to the recent record of declining incomes, in the midst of healthy GDP gains? Realizing that his economic record has become a problem, President Bush has spent the last few weeks engaged in a public relations offensive to try to turn around his dismal economic approval ratings. He went to Chicago earlier this month to trumpet what turned out to be disappointing jobs figures. And he used a White House press conference to highlight a new, lower than expected deficit projection, fueled by growing tax revenue from the wealthiest Americans. But on the issue of wages and incomes – the real issue for millions of working people – the administration’s response has been a mix of denial and spin.
Globalization is changing two of the most basic economic dynamics in our economy. First, it weakens the long-standing connection between increases in the productivity of American workers and the wages they earn. Since 2001, labor productivity in the United States has grown, on average, more than 3 percent a year. That’s the best performance in decades. Yet, despite five years of strong productivity growth, wages are stuck. Even when we include the value of health insurance premiums and pension contributions, the compensation of an average American worker has increased little, for all the economy’s productivity improvements.
Employers are asking workers to absorb an ever-greater share of rising health care costs, cutting into employees' net income, the report found.
"Workers don't have as much bargaining power as they once did," said Sylvia Allegretto, an economist with the Economic Policy Institute, a nonpartisan group in Washington, D.C. "And we've had this ever-increasing inflation that was eating up those wage gains."
Partly because of high health care costs, real earnings - or wages adjusted for inflation - declined slightly nationwide over the past six years to a median of $27,299, according to Monday's Families USA study, which used data from the U.S. Census Bureau.
That downward trend mirrors the findings of the 2006 Economic Report of the President.
The annual report showed that the average real wage for workers with a bachelor's degree declined 5.2 percent, from $54,396 to $51,568, from 2000 to 2004.
But in the last dozen years many of the trend lines measuring
American prosperity have flattened out, and some have even
turned downward. For example, average real wages remain today
substantially beloru their levels of the early 1970s. Despite
the rise in the number of two-income households, median afterinflation
family income has also dropped. Evidence of lower
incomes and living standards is particularly pronounced among
younger workers, indicating that the generation whose economic
prospects once looked so promising is acfually experiencing more
restricted opportunity for good jobs, advancement and income
growth than did their parents’ generation.
At first, many experts advised Americans that these trends were
only temporary. They were said to be products of extraordinary
“jolts” to our economic system, like the oil shortage, or of
demographic aberrations, like the baby boom, which would disappear
Others argued that declining incomes were caused by excessive
growth of government. In 1980 a new Administration promised
that its program of radical cuts in the civilian government activities
would unleash productive private investment and spark a long
term economic boom. Almost six years later, investment was stag
nant, the unemployment rate remained at levels that once would
have signaled a recession, and the central premise of so-called
“supply-side” economics had failed the test of the real world.
Since 1967, the median household income in the United States has risen modestly, fluctuating several times. Even though personal income has risen substantially and 42% of all household now have two income earners, the median household income has increased only slightly. According to the US Census Bureau, this paradoxial set of trends is due to the changing structure of American households. For example, while the proportion of wives working year-round in married couple households with children has increased fron 17% in 1967 to 39% in 1996, the proportion of such households among the general population has decreased. Thus, while married couple households with children are the most economically prosperous type of household in the United, their share of the population has been dwindeling in the United States. In 1969, more than 40% of all households consisted of a married couple with children. By 1996 only a rough quater of US households consisted of married couples with children. As a result of these changing household demographics, median household income rose only slighly despite an ever increasing female labor force and a considerable increase in the percentage of college graduates.
"From 1969 to 1996, median household income rose a very modest 6.3 percent in constant dollars... The 1969 to 1996 stagnation in median household income may, in fact, be largely a reflection of changes in the size and composition of households rather than a reflection of a stagnating economy."- John McNeil, US Census Bureau
Overall, the median household income rose from $33,338 in 1967 to an all-time high of $44,922 in 1999, and has since decreased slightly to $43,318. Decreases in household income are visible during each recession, while increases are visible during economic upturns. These fluctuations were felt across the income strata as the incomes of both, the 95th and 20th percentile were affected by flactuations in the economy. Yet, it is important to note that income in the period between 1967 and 1999 grew faster among wealthier households than it did among poorer households. For example the household income for the 80th precentile, the lower threshold for the top quintile, rose from $55,265 in 1967 to $86,867 in 2003, a 57.2% increase. The median household income rose by 30% while the income for the 20th percentile (the lower threshold for the second lowest quitile) rose by only 28% from $14,002 to $17,984. One should note that ht majority of households in the top quintile had two income earners, versus zero for the lowest quintile and that the widening gap between the top and lowest quintile may largely be the reflection of changing household demographics including the addition of women to the workforce.
To begin with, the prison system makes a direct contribution to regulating the lower segments of the labour market - and does so in infinitely more coercive fashion than any social charge or administrative rule. Its effect here is artificially to compress unemployment levels both by forcibly abstracting millions of males from the job-seeking population, and also by boosting employment in the prison goods and service sector. It is, for example, estimated that during the 1990s US prisons brought down US unemployment figures by two percentage points. According to Bruce Western and Katherine Beckett, taking into account the differences in levels of imprisonment in the two continents, and contrary to the idea commonly accepted and actively disseminated by the advocates of neoliberalism, for 18 of the past 20 years US unemployment rates have been higher than those of the European Union (12).
However, Western and Beckett show that the jump in the prison population is a two-edged weapon: while in the short term it makes the employment picture look rosier by cutting labour supply, in the longer term it will inevitably worsen the employment situation by making millions of people more or less unemployable. Although imprisonment has cut US unemployment levels, the prison system will have constantly to be abandoned to keep those levels down.
The fact that Blacks are massively and increasingly over-represented at all levels of the prison system highlights its second function in this new form of government by poverty: it is to replace the ghetto as a means of containing population groups considered deviant and dangerous, not to mention superfluous from both an economic and a political point of view - Mexican and Asian immigrants are far more docile. Poor Blacks hardly ever bother to vote and the country’s electoral centre of gravity has in any event shifted towards the White suburbs. To that extent, prison is merely the ultimate manifestation of a policy of exclusion of which the ghetto has been a means and an end since it first appeared in history.
According to official numbers by the U.S. Bureau of Labor Statistics, as of January 1999, only 5,950,000 million Americans were unemployed. But the truth is that while the current official national unemployment rate in the United States stands at a low 4.3 percent, there are far more people than that who are either out of work, only able to find part-time work, employed at below poverty level wages or employed below their skill level. Official jobless figures are only the tip of the iceberg. In contrast to many European countries, the United States, in compiling jobless data, excluded persons without employment who had stopped looking for work. People who want to work but are discouraged about job opportunities and so have given up an active job search are not counted here as unemployed. Instead, they are considered not to be in the labor force. Part-time workers who wanted full-time jobs are nevertheless counted as fully employed. People working even as little as one day a week are categorized as "employed." About two million Americans, for example, are "on-call" workers who are called to work as needed -- sometimes for one day, sometimes for longer. Substitute teachers meet this definition. Such a methodology for determining the extent of unemployment in America is symptomatic, at the very least, of the lack of official concern regarding the problem. Many might say, with good reason, that it reflects an intent to mislead.
Many independent economists accept that the true level of unemployment in the United States of America is at least double the official figure. Even former Commissioner of Labor Statistics, Janet Norwood, after declining reappointment in 1991, began speaking out on the inadequacies of government data. Not only did she acknowledge that the unemployment numbers were misleading, but she also said, "I am very worried, extraordinarily concerned, about the polarization I see going on in our country."
The discrepancy originates in the methodology of calculating unemployment rates: only those signed up at the unemployment office are being officially counted as unemployed. The six million officially unemployed persons consist solely of those who are registered at state unemployment centers as actively seeking for work. Many millions more have concluded that pursuing nonexistent jobs is futile and have dropped out of statistics altogether. Millions of discouraged people aren't being counted and are simply disappearing from official U.S. unemployment statistics. This discrepancy also reflects the fact that many unemployed people are simply hard for a government bureaucracy to track. Unless a person qualifies for unemployment benefits, they are virtually impossible to identify. Even people who once qualified for unemployment fall out of the system once their benefits end.
Jobs data don't count the down-and-out
Williams starts by discussing the headline economic data: "Real unemployment right now -- figured the way that the average person thinks of unemployment, meaning figured the way it was estimated back during the Great Depression -- is running about 12%. Real CPI right now is running at about 8%. And the real GDP probably is in contraction." (By "real," he means calculating the data the way they used to be calculated, not as inflation- adjusted.)
He then explains how the employment data are compiled, noting that 5 million chronically unemployed people are not included in the statistics. In fact, there are seven or eight different employment statistics. One called U-3 is the official one. The broadest one, U-6, currently shows unemployment as running around 8.4%. As he explains, the one that's the most historically consistent is running around 12%.
Originally posted by Iblis
Please insult the United States's economy when it is healthy, and poor.
Not when we have many, strong detractors hitting us simultaneously.
And I'm stopping there for sheer boredom.
Further, and I'm taking a hint from a CPA-friend at this moment,
The slowing of national economics is a trend.
National economies go through cycles, all of them regardless of their political leadership, as long as they are interdependent among other countries, and have a steady trade format.
We are currently going through a very soft recession, as was predicted during the nineties.
The reason you hear about the United State economy hitting a 'soft landing' is because this is the natural cycle, it is intended that we were to fall, the worry was, and still is, how hard.
However, with the latest outlook of fourth-quarter 2006, that hit will not be far at all.
It is my personal prediction that the United States will work towards further energy independence.
Russia will grow to become to have a vastly-strong energy sector, becoming a new supplier and reigniting European energy-wealth.
China's economy will catch up with the country, wages will rise, and exports will fall.
The United States will continue to lead, and follow in many vectors in the following years, maintaining a steady lead, with other nations closing the gap as international economics beome more and more entwined.
Everything, save for that last, admittedly opinionated, un-supported-by-any-fact-but-my-own-base-knowledge statement is true, and has just been supported by many diverse sources.
Do your best, Stellar.
Originally posted by Iblis
Ah, love, but the apology wasn't to you, but to Ape. While I wrongfully scorned him, pointed him out, and for a blind,
opinionated-reason, supported you,
I've realized the error, and went to work asking foregiveness from him. And him, being a genlteman, did accept. In case you didn't read his post. Or mine, that followed.
s for my supposed ignorance of strength? Be careful, you're also implying the large volume of sources I listed of apparently being equally ignorant,
nd that's a large leap of faith for a man who's never personally undertaken studies, or has the responsibility report the economic status of the Untied States, as several of mine did.
Income going to the toptwenty percent is nothing new. As has been observed by many politicians and economic 'philosophers', if I might call them that -- Marx, etc. -- there is a certain class system to economics.
The few who control the resource, or its production -- like goods -- receive the most income, while the masses of people whom work for them, earn less.
This is not a measure of any country's economics, since it applies to most capitalist countries anyway -- even Communism, as the corrupt politicians generally take more than the people.
Thank you for, again, pointing out a 'fact of life' so to speak.
And please, Stellar. Take a line from me, and do not take the majority of your evidence from a single-source.
Because if I, so to speak, break the leg of that source, most of your evidence tumbles down.
For instance -- Ron Paul. A very good man, I think. One of the strongest representatives the Libertarian party has.
However, he's markedly against _any_ expenditures by the United States government.
He is noted as an extremist towards his 'thinning' of the government, and taking away its abilities to control, in policy and economics, internationally or domestically, American business.
This is a man, whom, because of the cost.
The cost, alone.
Was the only one to vote against giving a Medal of Honor, [Gold], to:
Pope John Paul II
He supports the abolition of the income tax, most Cabinet departments and the Federal Reserve,
and is frequently the only dissenting vote among otherwise unanimous decisions.
You're taking a page from an economic and political radical.
Be careful, Stellar.
And, get to bed! It's 8:10, you should be tired, and not posting this nonsensical drivel, that shant get you anywhere.
Originally posted by Hiphar
Is Russia better prepared? Only in that they have less to lose, but they WILL lose it all.
During the Cold War, including the British SLBMs that would have accompanied the US warheads, Moscow alone would have been hit with over 500 thermonuclear warheads.
Every port, airbase, major city, and major military target would have been vaporized, as they would today.
The US invented nuclear war, and has been perfecting it ever since.
Originally posted by FreiMaurer
This topic is derrailed?
Well either way to Stellar I can vouch most Americans do not want to cut the Income tax, they support the progressive tax that oppresses them because they see it as a means to tax the rich and give to the poor (which is definitely not true but it's believed).
Just wanted to say that.