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.
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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?
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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.
www.businessweek.com...
Take out health care and the housing boom, and what's left? Not much, it turns out:
What's really propping up the economy ( picture)
The true picture of the job recovery (graph)
FRom earlier sources it's also clear that the housing boom had very little to do with a shortage in homes and much to do with very low interest rates giving people the ability to gain very favourable financing terms and thus 'wealth' they could borrow against; basically a big federal subsidy of the consumer economy paid for by Asian 'savers'.
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.
www.cepr.net...
As can be seen the 'growtht' in the job market is something to be especially concerned about as it shows up the destruction of the manufacturing sectory in striking clarity. With such job growth a recovery becomes ever more unlikely.
'REAL WAGES
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.
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