Data about the “Labor Shortage” pile up.
By Wolf Richter for WOLF STREET.
The weekly unemployment insurance claims data from the Labor Department — the latest batch was released on Thursday – has been making it relentlessly clearer by the week: In the 27 states that have ended the extra $300 a week in federal unemployment benefits (the Enders), people returned to work at a vastly faster rate than in states that retained the extra $300 a week (the Keepers).
This is based on continued unemployment insurance (UI) claims by state, reported weekly by the Department of Labor, and it is not survey based. Today’s “continued claims” reflect the number of people that have claimed UI for at least one week. A drop in continued claims would indicate that they have started working again.
Since the end of June, the “continued claims” for the US overall dropped by 20%, to 2.62 million (not seasonally adjusted), according to the Department of Labor, the lowest since the employment crisis began in March 2020. But they dropped over twice as fast in the Enders than in the Keepers:
- in the Enders dropped by 32%.
- in the Keepers dropped by 14%.
The first group of states ended the extra $300/week in early June. At the end of June, the big states Texas and Florida joined them. These Enders are still paying the regular state unemployment benefits, but ended the federal top-off benefits of $300 a week. The remaining states and Washington DC kept the extra $300 a week.
I put the states into two groups, the Enders and the Keepers, and added up each group’s total “continued unemployment claims” for each week, going back to the late June reporting week.
The four-week moving average smoothens out some of the week-to-week ups-and-downs that tend to occur in every state periodically. When they happen in one of the big states, they can skew the national weekly data. Being a four-week moving average, it lags the weekly data, but it shows the trend in a less noisy format:
Numerous other economists have also figured this out. According to The Wall Street Journal:
Economists at Goldman Sachs analyzed the behavior of workers in the July jobs report after adjusting for age, gender, marital status, education, household income, industry and occupation of a respondent’s current or prior job. They said they found “clear evidence that benefit expiration increased the rate at which unemployed workers became employed.”
Goldman Sachs estimated that if all states had ended benefits, July payroll growth would have been 400,000 stronger. Economists at the firm projected the nationwide benefit cutoff this month will account for 1.5 million job gains through the end of the year.
Anyone trying to fill open positions recently has figured out in their gut that part of the “labor shortage” they were facing, while millions of people were unemployed, was due to potential workers being incentivized not to work, with the extra $300 a week in benefits, on top of the state benefits, on top of not having to pay rent due to the eviction moratoriums, or not having to make mortgage payments due to the forbearance programs. The extra $300 a week were designed to allow people to pay for housing, and then they didn’t have to pay for housing either.
It’s one thing to make those policy decisions at the federal government level, but it’s quite another thing that the mainstream media are trying to cover up the side effects of those policies.
The federal $300 per week expires on September 6 for all states. Some states will then replace it with a state-based $300 a week, funded by federal stimulus payments sent to states. As these $300 a week fade out in more states, I would expect a series of strong jobs reports as people flood back into the workforce to fill open positions.
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All talk until the money runs out. Pretty much Money talks.
To expand that theme…Money Talks and B…S… Walks. Been true for a very long time.😂😂😂
And we certainly surrounded by the later in today’s world 🌍
We, in Australia are in yet another strictly enforced & continuous lockdown .. still. Million dollar businesses have shut down .. only that the capacity for insolvency & bankruptcy has been put on hold .. so it will not be see to be happening.
Over the last few weeks .. mainstream media TV news & current affairs programs have been .. over talking the compulsory superannuation funds & how well they are performing .. there has been a revamp to refine & maximise service & profit.
How is it possible that these funds are performing without regular contributions ??
Most of Australia is not at work ??
Is the Australian government paying the compulsory superannuation contributions for those citizens who no longer have employment ??
It is being suggested that the supper funds are bleeding out .. this would explain the ADF patrolling the streets & the verbal threats being spewed forth all over the media outlets.
A concerted effort to .. quickly .. get everyone to vaccinate.
The money is running out .. our beloved nation is financially screwed.
The Australian central bank can never rum out of australian dollars. Never. Ever. The money is not going to run out. When will people understand this simple fact.
topcat is right – money will never run out
just that wheel barrel will be what people will steal instead of cash piled up in it(they’ll dump it)
Once inflation showes its nasty face, then they will start to run after the dollar bill 💸 again faster!
This is deliberate program to reset the economy by making poor people even more poorer.
The bifurcation of our society is in full swing.
Those with stocks and housing doing fine..
those with out have had the “ladder pulled up” …
The lame excuse that low rates help “main street” holds no water…it is a ruse to keep rates low for the upper class (that’s right, I said it)
Others can not even SAVE THEIR MONEY in order to get on their financial feet. Saving is now PUNISHED…and not by mistake…intentionally by a Fed that is bound (ha) to “stable prices” and “moderate long term interest rates”. (ha, ha ha)
Powell is apparently in such a bubble he has no idea of the remainder of America. The American worker / saver just had a 5% cut…..and the Fed doesnt lift a finger to address the evil inflation.
Curious.
@historicus: Agree 100%
Inflation is only bad when it happens to wages at the bottom. Policymakers never wring their hands over executive pay. Or attorney rates. Or higher ed admin compensation. Or Wall Street bonuses.
It’s only bad when it filters down to the servants of the upper classes. They want cheap servants. And they will get it because they are the policymakers.
The question always asked is:
Are we paying our wage slaves too much?
Official inflation number is 5 percent but real inflation is 15 percent
I keep hearing from people that these powerful elites are ignorant of economics, or are living in a fantasy world… I think that’s naive. I’d wager a lot of money (that I don’t have) that they’re driving us over a cliff for a specific purpose. I can speculate on that purpose, but does it really matter? The point is that no one is doing anything about it until it’s too late, at which point we will be on the hook for the damages.
Try 50 percent haircut. Interest rates fell in half. Retirees will be living on the streets.
It really doesn’t matter, so long as Fer keep dumping money into market to prop up securities. The new jobs print could be 1k jobs and market will still go up….it’s all a fraud.
The classic Thatcher quote was “The problem with Socialism is that you eventually run out of other people’s money.”
The socialists thought they “solved” the problem by owning the printing press – voila, today MMT says “we can never run out of money” and the socialists embrace it.
The problem with this is instead of Socialists running out of other people’s money, the people will run away from the Socialists’ money. Hyperinflation.
Note, also kleptocracies can run out of other peoples money too. As can cronyy capitalism and others.
Right. So let’s stop UI payments. Labor shortage solved!
Back to treadmill.Same as before but somehow less fun…wonder why. Blue skies stir rebellion.
I thought that PUA/PEUC had ended entirely in half the states, but I guess it was only the extra $300 a week that ended in those states. No wonder inflation isn’t as transitory as expected. With PUA and PEUC suddenly ending on September 6, why is there so much talk about tapering QE? They need to be worried about tapering unemployment benefits.
Some of the “ender” states ended all the programs while others kept some of them.
It will be a rude awakening in a couple weeks when over millions of people get either their last check or a reduced one.
They are talking about tapering, but not doing anything because they are caught between inflation and a whole bunch of downward pressure on spending that will happen soon. All those benefits ending, the stimmie money running out of bank accounts slowly, and at some point, a stock market dive that causes people to pull back on spending. But the really big one is all the money the Treasury will need to raise as soon as the debt limit is raised. The 1.8 billion that was spent out of the general account and not floated to the markets starved debt markets of supply.
By early next year, we are back into an economy that is trending downward, but a government that cant spend more money as interest payments are much higher and inflation is persistent.
It is time for this experiment in trickle-down economics to end.
Had a nice conversation last week with a guy who was picking through lumber I was tossing for bits he could use (wife forbade him from buying 2x4s due to the prices). He told me the tire shop he works at has hired 29 people in the last 2.5 months, of which 27 stayed just long enough to qualify for UEB again and then got themselves fired (mostly by not showing up).
What an unqualified fucking disaster.
AlaskanSalmon,
If you get fired, you don’t qualify for any UI. If you file a UI claim, the employer, who will be contacted, can contest it on the ground that they fired you for not showing up. Some of these stories that are circulating out there are just BS.
Sure you can fire someone for not showing up, but it is really hard to fire someone for incompetence or laziness and not pay umemployment.
In an at-will state you can fire anyone for no stated reason, and that person cannot qualify for unemployment after getting fired. In the other states, you still can fire employees but you have to state a reason. Incompetence is good enough. And then that person cannot qualify for unemployment.
Getting laid off for economic reasons qualifies the claimant for unemployment.
But you can get another Job then be laid off perhaps a month later and draw you UI from the employer who fired you or if Evan you quit .
They will moan and groan but they must Pay !
This is a great Blog my only wish is that it had 100,000 Viewers / posters joining in then things might change for the better however Grass Roots start somewhere now don’t they Thanks Wolf
The percentage of readers who also post comments is less than 1/10th of 1%. It’s minuscule. This site has between 200,000 and 400,000 “active users” per month, per Google analytics. Of these readers, quite a few read the comments. Almost none (a few hundred maybe) write comments.
@ Wolf Richter
Is installing Google analytics a requirement by advertisers?
The 200-400K visitors is nice, and quite a breakthrough.
Is there a breakdown by regions?
Maximus Minimus,
Some kind of analytics is required to understand what your site is doing. Google Analytics does a gazillion things, a lot more than I use. If I had the time, I would pull specific info, such as you’re asking. There are a million different ways of looking at this stuff, most of which are useless for what I do.
Technically it is not being fired. Not showing up for work is “quitting”, or a “voluntary termination”. The result is the former employee does not qualify for UI.
Wolf,
There are definitely alot of made up and exaggerated stories. But, I can say even in my average Midwest state, even in normal times, a fired person can claim it was the bosses fault and still get unemployment, and sometimes extra claimed money from employers. It’s rare but, I’ve even directly seen cases, where bad employees (pre pandemic) claim the boss underpaid them, when the employee was actually being paid for more hours than they actually worked. In one case I directly saw, an employee worked 25 hours a week on average, slowly raised their stated hours to 35 hours a week, and after being fired, claimed they actually worked 40+ hours a week (there was various other reasons, she was a bad employee). Then it went to the “mediator” who asks for proof from each side, the boss presented the evidence, the employee didn’t, because she didn’t have any, the “mediator” sided with the employee and required the boss to payout some money to the employee, who already got paid for more hours than she worked. That’s rare, normally an employee (pre pandemic) gets fired, blames it on boss, then either moves onto the next thing, or tries to claim unemployment without going after boss, for additional money.
I’ve heard similar stories to my above one, from the people at the local business owners networking group (/social club).
During the pandemic though, you could definitely get fired and still collect unemployment, most of the time. During the beginning, it was extremely easy to do that, now it’s getting harder, but varies by state.
It’s not a guarantee (no idea, what the odds are), they will succeed in getting unemployment during normal times, if they are fired, but almost every fired employee will blame the boss. Usually, they just move onto next thing.
The people in charge of labor departments in the individual states governments, are rarely qualified.
I got fired here in IL in 2015 because my toxic boss made stuff up to get rid of me and I qualified.
Lots of times, when we fired people, we would tell them that we would not contest their unemployment claim. Then when they applied for UI, they qualified because we, the employer, OK’ed it when the UI office reached out to us to confirm. This was in Oklahoma.
A friend of mine with a high-paying tech job got aged out of a company, and they let him apply for UI as part of the deal. This was in CA just before the Pandemic. He is still cashing in his UI payments plus the extra $300 a week, plus all the stock options that were allowed to vest, plus, plus, plus…
When you get fired in the Federal Government you’re given a golden parachute and told “You’ve done one heck of a job” .
Remember GWB after Katrina
Actually as a former employer with 100 employees in Texas, what happened was the TWC ( Texas Workforce Commission) would charge my UI account and THEN I had to refute AND prove the employee was terminated for cause.
In Texas you need to work 2 quarters to qualify once benefits are exhausted.
What state is this because you can’t do that here in Georgia?
Labour shortage?
No, just a price mismatch. Those unemployment benefits have had some of the effect as raising the minimum wage. Employers must pay better and treat their prospective labour better to get them to sign on for the low wage jobs. Of course, that is a problem for some, much less money can then be aggregated at the top.
Anecdotal, it is not the wages that make American workers expensive. Years ago, I met a Norwegian engineer at a shipyard down in Louisiana. Flown in from Norway, expenses paid to do a few days work. His wage and compensation were higher and better than his American counterpart.
Anyway, to the customer it was cheaper than to get someone from New Orleans or other place closer. Now, figure out what make labour expensive in America.😉
In an ideal situation price is the magic that gets the economy to function like a finely made swiss watch. At least in the USA the Fed and Congress have nearly destroyed pricing.
What can we do in the USA at a reasonable cost? Build a house? No.
Build a automobile? No. Obtain a college degree? No. Provide hospital services? No. Offer an interest bearing savings account? No.
Old School
No one knows what money is worth…because of the Fed.
Thus, no one knows for certain what ANYTHING is worth…
Money is a wasting asset, by decree, by the Monetary Dictators called the Fed.
Whatever the central bankers touch, they skew.
Whatever the federal government touches, they skew.
Get out of the way and let’s see what things are really worth….
I think they are afraid to look..
Re “No one knows what money is worth…because of the Fed.
Thus, no one knows for certain what ANYTHING is worth…”
I agree with your point about the Fed’s terrible money, but disagree that people don’t know what stuff is worth.
Regardless of the value of money, items can and are priced relative to one another. People know whether they would rather buy, say, a car, groceries, or stocks with their paycheck this week. That demand, plus available supply, sets the relative pricing of those items, regardless of the value of money.
Money just makes it easier to trade those other items without bartering.
I was in the grocery store looking for some fresh fish. It was hard to come buy. They were blaming the hurricane and the disruption in airline deliveries. Then I noticed some fresh Halibat which looked real good. The only problem, it was $24.99/lb. I took a pass and went to another store where I got some pretty good Cod for $7.99/lb.
It’s the cost of the ‘vig’ that makes labor unaffordable. The middlemen are expensive.
What is “vig?”
Vig (or vigorish) is what you pay to the mob so they don’t burn down your store or interfere with your deliveries. Can also apply to loan shark rates charged by bookies or loan sharks.
“Vig” has acquired a broader meaning – it’s the embedded cost of the excessive rents, overheads, red tape, pointless bureaucratic waste, sky-high corporate profit margins, monopolistic price gouging, and everything else that has been tucked into “the system” at the expense of those who actually produce the legitimate goods and services.
Ask Tuco Salamanca.
In Nova Scotia, where we catch the fish, haddock is 6.50 lb, halibut 16.00 lb, but the prize is halibut cheeks 12.00 lb cdn dollars. The halibut cheeks are never sold commercially for export as there are only two per fish. They are like big digby scallops, simply the best. No faking these either. Yum. Got some today from roadside vendor.
The United States has the least regulation in labor pricing – therefore it should have the cheapest relative cost for everything labor related.
As this is clearly untrue – obviously labor price is *not* the governing factor in the US economy.
Not this was true before COVID.
Not sure on that. If you have a few employees there is going to be the cost of social security taxes, income taxes, workers compensation, paying into unemployment insurance fund, paying for workman’s compensation, plus you are going to need some kind of general liability insurance. Plus you are going to pay the cost of accounting for all of the pay roll taxes and getting those to Fed and state.
c1ue,
The price of labor is dictated by things such as the price levels in a country, the minimum wage, what other employers are paying for the same demographics of potential employees and much more. The cost of bureaucracy, definitely adds to that.
The price of labor is also effected by the general mood of the labor force; right now, across many developed countries and even some developing ones like China, there is what China is calling “the lie flat movement” (this is my favorite term for this), basically an increasing number of young people in various parts of the world, see themselves as being screwed over, and so rather than working hard, they will do the minimal amount to live a simpler lifestyle. This general mood, which originated in various forms simultaneously in the west and parts of Asia, is spreading fast. There are various types of moods that can effect a labor force, such as in very corrupt ones that go the “socialist route”, a sense of pointlessness, inequality, pessimism and other similar feelings, can cause many types of employees, to become very lazy.
In terms of bureaucracy, America is roughly in the middle tier globally, I would say, at the moment.
While the general ease of starting and doing most business stuff is very great in America, the effects on the overall economy of various oilgopolys (everything from suppliers to how it effects your customers), ridiculous rules written by bigger players in the same industry, the existence of workers comp, and all the lawsuits definitely bring America’s ranking down.
Workers comp needs to be turned into a payroll tax or just eliminated (unemployment compensation, would still exist, just the way for paying for it and the associated bureaucracy would be gone).
An ex Naval, now civilian, test pilot’s (E2 platform) view of US military aviation. “Over engineered, overpriced junk built by the lowest bidder.
Maintained by teenagers, and flown by those not much older”.
Same M.O. i experienced amidst my mid 70’s ‘Chairforce’ enlisted stint.
Sams, The Norwegian was flown in because he or she had knowledge that nobody in Louisiana had. It had nothing to do with the quality of US workers.
If it was custom software work, the source code is a trade secret and not revealed. If it was service work, it can take a year of training and work to be proficient in servicing complex industrial equipment. It’s cheaper to fly someone in than it is to train a local person for the job.
For the record, there are also US manufacturers of complex, industrial equipment with US engineers flying around the world doing installations and service. Anyone who does international work is very skilled and well paid.
The engineer’s skills may have made him work faster, but there was engineers with the same skils localy. I have met them too. It was not about skills, it was cost.
The Norwegian may have had specialized knowledge but he didn’t stay for long. The problem in flyover country is that there is not enough to keep an American high earner entertained or engaged for long. This creates backlogs in infrastructure and other problems in those places. It can be a good opportunity for someone willing to stick it out for awhile.
Most engineering work is highly specialized, so sometimes someone with the right specialization in the exact equipment can solve the problem in 5 minutes.
The cost, with a name I learnt today. The «Vlg» as Wisdom Seeker outline it.
The most talented employees are soon dissatisfied with living in an area where tractor pulls and BBQ’s are considered cultural events.
@roddy – your ignorance of Middle American culture doesn’t do you any credit.
Ok and this person came from a high-wage country..
Compare this with the low wage foreign guest workers flooding the usa. I read the a full 2/3 of ALL recent software developer hires were H1-B or OPT visas.
Its clear that corps are lobbying to altering he rules of supply and demand instead of pricing mechanism to their favor!
Maybe not. The incentives can be very different due to cost accounting.
Typically the burden on contract labor is low, perhaps 10% to 25%.
Meanwhile, I’ve seen the employee burden as high as 500%.
Thus we see some companies use a lot of contract labor (including professional services aka consultants) in lieu of employees. Because they can get far more qualified people for less money.
@K
Everywhere and always the world relies on engineers to function. High class engineers can write their own cheques anywhere.
The countries with the best engineers run the World.
Accountants constrain engineers.
Architects exasperate engineers.
Not professionally biased.
Just sayin’
Auld, et al-an old joke:
people who are optimists see the glass as half-full…
people who are pessimists see the glass as half-empty…
people who are engineers wonder why the glass is the wrong size…
may we all find a better day.
Price mismatch addendum.
An acquaintance who (and his wife) were shown the door (when they turned 50) at a major chip mfg (company’s first letter starts w/I). He was software engineering support, wife was in finance. He got zip while wife got severance (spending it going to Law school, now does pro bono employment law as no jobs in that sector).
He returns (after a year) for an administrative (green badge) position for two years (length of contract) and is let go when the company does not renew the temp agency’s contract.
New temp agency now handing staffing, and he’s offered same position for 1/3 less pay rate. He declines.
After a decade plus of knowing this pragmatic man (Japanese national w/US citizenship), i would say he is very objective & unbiased.
Being i know nothing of how mega mfg companies function, i inquire what’s the expertise level he’s seen at the company over the decades.
His response: “Half of what it was when started there decades ago. Formerly, divisions were proactive. Now reactive.”
Just another story….of pricing power
And you live where?
Sams…….”. Now, figure out what make labour expensive in America.”
To name just one: Employer paid health care (private health insurance racket).
I am sure many other things do too (social security and higher education is another).
The USA is an expensive place to do business in because whereas other countries manage/regulate what should be utilities or public goods to keep costs down, the USA lets the private monopolies charge all that they can.
Quelle surprise!
I think it’s interesting that a significant portion of Americans are willing to end their careers for and extra $300 per week. That’s an indication to me that the opportunities for a decent life in the current environment have collapsed for many.
People talk of the “coming collapse”. I don’t see it that way. The whole country doesn’t go down together. Bigger and bigger portions of the bottom have collapsed and continue to collapse. While the rest continues to do fine. The problem starts when those in the collapsed column start voting together for politicians who actually represent their interests.
Kent
each morning….wives ask the husbands…
“Honey, how much higher is our stock market today?
Mr. Powell is a wonderful man.
And why do are neighbors go to work?”
It could be the other way round, if those in the collapsed column start voting together for politicians who actually represent their interests, they may get opportunities for a decent life again, working.
To me the handouts look more like an attempt to postpone any structural change. Throw some pennies to the poor but keep the structure to plunder most.
Consider, the riches country may be the one where the poor is best off, not the country where the top 0.1 have the most.
“if those in the collapsed column start voting together for politicians who actually represent their interests, they may get opportunities for a decent life again, working.”
That was the person elected in 2016. An unexpected fluke. Even though he didn’t do even a fraction of what he could have done if he’d actually been 100% on their side and, BTW, he was a big fan of massive Fed intervention, he still had to be destroyed by the corrupt system long in place. Even slight deviations from the massively corrupt and self-serving status quo must be dealt with.
That and he was a complete and utter douche, more so than any other human being in history, and lots of people didn’t like being represented by the douche to end all douches.
At least you people are finally admitting he was destroyed. Thats at least one step in the right direction.
I am totally with the big Z on this one:
As an eternal optimist, ( except when highly paid to be otherwise as has happened a ton, )
I had high hopes for BO to be the honest rep of WE the Peons, but just until he signed off on the $8BB for the nukes in SC, and then the bend over to the so called ”health insurance” industry, etc., etc., when it became crystal clear he was in it for the personal profit, which apparently did accrue…
Similarly with DJT, in spite of his clearly known record of screwing small contractors, a class of which I used to belong to.
Not really sure which of them were worse for small biz folks and wage slaves,,, and not really sure either of the current ”parties” are really and truly any different these days.
Used to be fairly clear the re-publicans were for socialism for the rich,,, and the demo-c-rats were for socialism for the poor,,, both clearly NOT representing the vast majority of the middle of WE the Peons, at least since IKE,,!!
Now, both appear to be kowtowing to the rich at our continuing expense…
Wise woman told me about 40 years ago,,, and had the bumper sticker to show here dedication:
CLEAN HOUSE, SENATE TOO, until we have folks in all guv mint seats everywhere who actually represent the interests of WE the VAST majority of PEONS/wage slaves/working folks/etc..
Good luck and God Bless all you young boomers and all those willing to GO FORTH and work for your own success while at least trying to help all other ”workers” similarly succeed.
Harrold, it was clear from the BS from the courts and media that he was never going to be treated fairly.
The important aspect of Trump’s election is that he did it without being part of the system.
“Whose bread I eat, his song I sing”. – German proverb
In politics you start low and show the upper ranks that you’re a good soldier who sticks to the party line. Then you can move up the ladder. The higher you climb the more money you get from the party and the PACs for your election campaigns
Would Obama have risen above dog catcher in his party if he said he was pro-life?
Trump bypassed that because he was not dependent on political party money. The civics lesson is plain to see.
Ultimately Trump went to DC to drain the Swamp but the Swamp dwellers fought back. That’s another great civics lesson.
All of this is as old as the republic. Actually it’s thousands of years old. When monarchy died, oligarchy filled the void.
It’s pretty clear real returns in stock market are going to be around t-bills rate for 20 years or so. The Fed has pushed asset prices up so much that even utility yield are less than inflation.
I think it’s more likely asset prices collapse.
RNY,
I didn’t say it clearly. People in stocks are taking a lot of risk and about the best they can hope for is not much return for 20 years. Might be a collapse or two along the way.
The Republicans represent the Top 1 percent. The Democrats represent the Top 10 percent. How should people in the collapsed column vote?
The democrats also represent the 1%.
The difference is that one party cuts the direct tax rate and the other party raises the tax rate but increases the write-offs or straight up takes the tax money and puts it into their pocket.
The farce that the Democrats are somehow more caring is insane. They spam rhetoric but their actions run contrary to the rhetoric.
Yes. Watch what they do, not what they say.
A big tell is the bipartisan inability to stop the loopholes for the ultra-wealthy, even when it’s blatantly in the public interest to do so, and even when there’s a media spotlight on the issue.
“There is only one party in the United States, the Property Party … and it has two right wings: Republican and Democrat. Republicans are a bit stupider, more rigid, more doctrinaire in their laissez-faire capitalism than the Democrats, who are cuter, prettier, a bit more corrupt — until recently … and more willing than the Republicans to make small adjustments when the poor, the black, the anti-imperialists get out of hand. But, essentially, there is no difference between the two parties.”
This quote is as true today as when it was written nearly 50 years ago (by Gore Vidal).
Both parties represent the top 10% and neither party represents savers and middle class.
The top 1% would be billionaires like Warren Buffet, Bill Gates, Elon Musk, Bezos, Zuckerberg, Bloomberg – – all Democrats.
Koch brothers, Sheldon Adelson, Peter Thiel, Foster Friess, Paul Singer, Ken Langone, Woody Johnson, Robert Mercer. These are quiet money men. They fly under the radar for the most part.
The distinguishing factor IMHO is the rich liberals currently control a lot of the media, especially popular exchanges of ideas like Facebook, Twitter, YouTube, etc. So add Jack Dorsey to your rich liberals list.
Control the media
Legalize bribery (lobbying)
Gather up the strings of the legal system (SCOTUS, appeals, etc)
Selectively prosecute/persecute your opponents.
Oligarchy. Nobody is on our side. Every election is an auction of favors promised but never delivered.
With a torch and a pitchfork.
I guess those folks figure that with the labor market so strong and employers so desperate for staff, employers will take on anyone, even those who stayed on the extra $300 even when they could go back to work.
This. No point working hard when rentiers take it all. But Americans celebrate rentiers as “entrepreneurs” even when classical liberals critiqued them. Not because Americans disagree, they simply can’t be bothered to understand it.
“Not because Americans disagree, they simply can’t be bothered to understand it.”
Yeah, U.S. culture is basically anti-intellectual. You even see it on these threads – people ranting as if “academics” are the root of evil government. America is more of a Spartan, violent culture at the grass roots. Like in sports, only being #1 matters. All others losers.
It’s interesting that schizophrenics hear different kinds of voices (auditory hallucinations) depending on what culture they were raised in:
“The striking difference was that while many of the African and Indian subjects registered predominantly positive experiences with their voices, not one American did. Rather, the U.S. subjects were more likely to report experiences as violent and hateful…”
(that was a study by one of those useless anthropologist academics!)
“Yeah, U.S. culture is basically anti-intellectual.”
And other countries, say in Europe, are doing so much better?
The IQ bell curve combined with the abject failure to specifically teach the learned skill of critical thought and analysis has allowed politicians to do what they do throughout history.
“I think people in power have a vested interest to oppose critical thinking. You see, if we don’t improve our understanding of critical thinking and develop it as kind of second nature, we are just suckers ready to be taken by the next charlatan who ambles along… there are lots of ways to gain power and money by deceiving people who are not skilled in critical thinking.” – Carl Sagan, noted cosmologist, in radio interview, May 1996
“The masses have never thirsted after truth. They turn aside from evidence that is not to their taste, preferring the deify error, if error seduce them. Whoever can supply them with illusions is easily their master; whoever attempts to destroy their illusions is always their victim.” – Excerpt from Gustav Le Bon’s “The Crowd” (1895)
“As democracy is perfected, the office of president represents, more and more closely, the inner soul of the people. On some great and glorious day the plain folks of the land will reach their heart’s desire at last and the White House will be adorned by a downright moron.” – H.L. Mencken (1880 – 1956)
There is, in my opinion, no comparison between USA culture and European culture. Even at the most basic level, let’s take food. European workers can feed themselves well from basic ingredients. Community is better. They live longer, work fewer hours.
Georgist,
You don’t need to look too much further than German bund and European growth rate to know that Europe is a debt saturated economy with worse future than US and that is saying a lot.
“I think it’s interesting that a significant portion of Americans are willing to end their careers for and extra $300 per week. That’s an indication to me that the opportunities for a decent life in the current environment have collapsed for many.“
Yet also an opportunity for others…
In my area, I have seen tv commercials and news stories for HVAC and auto service employment…
“Will Train”…
These are normally tech school grad jobs that pay well yet require a year or more of school to qualify for the job…
A lot of people at minimum wage cannot afford time off for school or tuition, because they have to exist, ( bills groceries), so these types of jobs were basically unavailable for them…
The opportunity to get one of these jobs immediately without the prerequisites could be a life changing opportunity for some…
The caveat… you have to be smart enough to recognize it…
The first paragraph is saying it all.
People believe that if they work hard and get a job and climb up a bit – their lives will be the same as before. So they are doing the minimum.
The American Rentier Nightmare.
There’s truth in it. I screwed up my life in youth through many misdeeds and mistakes. Luckily no jail or conviction records somehow. Worked crappy dead end jobs living in a vehicle or camping out with family because I couldn’t afford housing on my pathetic wages. Then I went into trucking because it’s the only way out when you’re young and have no profitable skills or a fancy piece of paper saying you have lots of patience and an eagerness to go into debt. Similar to the military or criminality a mountain of young men follow.
And I’ve managed to get myself to a spot where I can manage on my own and put back a lot in savings but I’m getting slaughtered on rent and housing is essentially unviable now across the US for me. In the same breath though I know one emergency expense can set me back in life permanently. I guess that is life for you but it’s hard to have compassion for the game that is so heavily stacked against you.
I don’t really blame anyone for taking a 1-2 year retirement off the govt dole. Most who made more sitting at home than working will be destitute for life and won’t retire in any positive manner and will be perpetual leeches who clamber onto others to make ends meet. If I wouldn’t have been blacklisted from the trucking industry for not driving for more than 6 months and having to start over as though I’d never driven anything more than a sedan, I’d have been a moocher myself.
More power to them I say. Not like being a clerk or stock boy for 50 years is a career that would suffer from being “on hold.” Walmart greeter isn’t a career path. It’s just a way to afford a booze and weed habit to escape your depressing life.
As a matter of thought experiment, laws can change. Imagine if the US companies got creative enough and if China got restrictive enough, they might decide it is practicable to import some Chinese labor into the US for manufacturing.
What’s not to like:
1. Better air quality.
2. Higher pay (likely).
3. No working 996.
From the employer side, there are benefits too.
1. You likely get a better educated work force.
2. Likely one that appreciate the employers more.
3. And I would guess not nearly as many whiners.
Wins for everyone all around.
😝
MCH
I have suggested a version of this many times in WS comment sections and still no one has told me why it would not work.
The US Dept of Labor can easily create a fancy title like “Consumer Advocate” which, like the military of old, will accept pretty much anyone who does not have an indefensible criminal record. We can call them “CA’s.” Maybe a CA must allow every item or service they purchase to be tracked by any number of agencies (data for gubment and retailers).
US prints $$$, hands it out as monthly salary, and CA’s can live a viable productive social life in the US.
Gubment and retailers will gorge on the data as more CA’s enter the “work” force. There’s no sign retailers (mostly China) would NOT love this arrangement. It also allows manufacturing / pollution to stay away from US soil.
I could envision 25%+ of adult Americans choosing this occupation.
@beardawg,
Hmmm, that’s a good idea that doesn’t sound f***ed up at all. Totally in line with our current reality.
Let’s put on top of that the “CAs” would get them quarterly COLA adjustments for their govt jobs and stack enough benefits off of it to make Illinois look sane. All backed by endless printing of the global reserve currency.
Unsane.
MCH
I concur that being a compensated professional consumer (Consumer Advocate in my example), seems unethical, un-American and perhaps other adjectives.
However, considering the Fed & politicians’ appetites for endless stimmies which tend to assure re-election AND the rest of the world showing no real concern about accepting USD, having a govt-sponsored “Consumer Advocate” position might not be Sci-Fi.
“America may not be the country of your faculty lounge and Twitter dreams, but no one here tries to escape by hanging on to an airplane. No, we wait ’til we get inside the plane to fight – and only because they cut off the beverage service.” – Bill Maher
Incisive perspective.
@Gorback
It’s funny… Let’s try a thought experiment. We set up an exchange program. Rotating group of Americans (let’s say 3M a year to balance out the incoming immigrants – for our purposes, we just call them all immigrants, legal or otherwise, who I submit are more likely to be willing to work) to “third world countries” for two years we’ll pick the ones who are on unemployment, or don’t have jobs, or are otherwise going to have problems surviving in this country because of *insert your excuse here* etc…. (making exceptions for the physically disabled, etc) then send them to Honduras, or Ghana, or Butan, or any of the 100 or so countries that are designated as such.
Then provide them the equivalent pay of the middle class in that third world country for two years up front, then bar them from entering the US for two years. When they come back, they’ll either really appreciate what’s in the US, or well, they won’t make it back. Either way, the country is better off.
The problem is for most people taking the $300/week over working, especially those who made more from this benefit, they almost certainly were not working any type of a job that could be considered a “career”. They were merely working jobs to get by.
An increasing number of people can only do jobs that 30 years ago, could have provided a living. Now, they barely enable survival.
Everybody seems to be forgetting that with Covid running rampant, there were no jobs out there, at any rate of pay. And a lot of people paying decent wages werent hiring, because of the uncertainty.
I think it funny that everyone is blaming the extra $300/week the wretched refuse got for all these economic dislocations.
In the meantime, Im seeing more and more restaurants shutting down early or not opening at all, because nobody came in to work.
IMO, a bunch of structural problems with the way money is sorted between the upper 10% and the wretched refuse are chickens coming home to roost that Covid accelerated.
Im my business, the squawking about “no good help” has been going on for a while. Yet the defacto average pay hasnt moved an inch in 20 years. Very few young guys are getting in the business anymore. Who wants to deal with the risks of fixing airplanes, when there are a helluva lot of jobs that use the same skill set, and pay the same or better? No 24 hour on call, weekends, no second, third or weekend shifts, no working outside in blizzards, no working inside aluminum cans in 150 degree temps in summer
( A Snap-On dealer told me back in the 90s: “I dont go to airplane shops. Airplane mechs dont have any money.)
I think anyone calling a minimum wage job, a career, is not living in reality.
It is perfectly sane for people to not want to work crap jobs with no upward mobility or future prospects (i.e. retail, fast food, Uber, etc) if given any alternative.
The fact that ~$400/week ($300 federal + state UE) = ~$20K a year is better than most low end jobs should speak volumes.
What you say is true.
It’s still a lie when the media reports that paying people more not to work is a minimal factor in the current labor market.
Only an economic illiterate or someone who favors paying people more not to work will claim otherwise.
Most states’ max monthly benefits (assuming you qualify for them) are over $300/week, not $100.
Correction: max weekly, not monthly.
@K
“The whole country doesn’t go down together”
Agreed, but the way I see it, more and more fall over the edge. That’s how it worked in the decline of the UK.
Wolf,
Thank you! Now can we get some coverage today mainstream on this!?
The mainstream media and the political parties work for the top 1%.
The “moderate” Democrats are now starting to show their hand. They profess to help the working man, but look at how they balk at the increase in capital gains tax and the elimination of free basis step-up at death. They want the right to pass down appreciated assets from generation to generation without having to pay income tax on the unrealized wealth. Both parties ultimately report up to the billionaire class.
Have you seen anything significant happen the past few decades that wasn’t a boon to the top 1%?
You realize what that means right?
It’s the job of all the schmucks to try to move up to the top 1%. Don’t expect any favors, because those are likely to be little peasant traps to suck you into a life of unending servitude backed by an ongoing emphasis in not educating you with anything useful.
My experience is that getting extra training, and taking on extra responsibility is never compensated.
For a while, I was a foreman at a large union repair shop. On weekends, Id be the only manager there.
On weekend shifts, it got to the point where the new hires were making more than I was.
The process to replace my ass is typical of the way stuff is “managed” by US business:
-First 8 months……pay the senior guy in the bargaining unit time and a half/double time to “cover”
-When they couldnt find anyone to fill the position, they lowered the requirements close to the “fog a mirror” level.
– New guy hired out of military…….which means he turned wrenches a few years, but became a “manager” when he made sergeant/chief. Maintenance managers in the military evidently sit in the office, do paperwork and drink coffee all day.
-“Managed” the shift about a year…….until he got fired for sexually harrasing one of the women in the office (whose husband happened to be one of the shop crew chiefs).
As I tell people, ‘ I used to think Jerry Springer was BS. Until I got into management…….”
Miracle of miracles.
Why does everyone know that people will not work when payed to stay home other than politicians?
What planet are politicians from?
Moronia…
The real news is that workers feel a gap in their CV won’t effect their future life. And it won’t, because land prices have detached from wages. They were never going to make it anyway!
Uranus.
What’s crazy is how many “studies” I keep reading about in the press which claim the early termination of benefits have had essentially no effect when clearly they have. Just goes to show how many academics really do have their heads so far up their @$$ they can’t hardly see anything.
Thanks for confirming what is patently obvious, Wolf!
If these “studies” have demonstrated anything, it’s mostly that the free money hasn’t run out and nothing more. Low wage earners mostly didn’t love or like their jobs prior to COVID.
I’ve read articles where the claim is made that people supposedly haven’t returned for other reasons.
Ultimately, if someone is broke, can’t pay their bills and isn’t supported by someone else, they go back to work whether they like it or not. That’s reality.
This doesn’t tell us people returned to work. It tells us that if you cut off UI benefits fewer people will collect UI, which is pretty obvious. The state employment data shows that cutters lagged non-cutters in job creation in July.
Good point. It would be informative to see the job creation date integrated into the graphs.
*date=data
“Good point?” No, lousy thoughtless point. See my comment below.
In terms of a chart, the monthly jobs report for July didn’t reflect Texas and Florida yet (see my comment below), which quit at the end of June, and the July jobs report covered the first half of July, and lags in job search and reporting prevented the Texas and Florida data from being reflected. Today’s August jobs report would provide the data through the first half of August, but the detailed state-based data will be released in a few weeks, not today. And then you have a chart with two data points, a starting point and an end point.
Once we have a several months of data (say, with the October jobs report), I might do this chart just to blow this nonsense out of the water once and for all.
Okay, I understand my error. I was thinking there might be some underlying employment related base rates involved that differentiate the Ender states vs. the Keeper states. That is purely speculative and if true, might even strengthen the effect of free money galore stimmies demotivating people to get a job (which I agree with).
Unless I had family responsibilities, if I got so much insurance money, I would probably do the same – take a break from toxic work environments.
Umm, not exactly. UI benefits weren’t “cut off”. The extra $300 was cut off. If those folks didn’t get new jobs they could have still kept claiming the state-provided portion of UI benefits.
How long do you think state benefits last anyhow?
Florida its 12 weeks.
Doug Henwood,
This is nonsense for a bunch of reasons, including these:
#1 you mixed data from UI claims (in terms of the states that ended the benefits) and data from the survey-based jobs report (monthly) of ENTERPRISES, which is an entirely different ballgame.
#2, the media articles you refer to use the July jobs report, whose surveys were collected in mid-July for the prior two weeks, looking at survey responses of the first half of July. Texas and Florida joined the Enders at the end of June, and that data wasn’t even reflected in the mid-July surveys due to the lag in hiring and reporting. This data here is through August.
#3. UI benefits were NOT cut off. What was cut off was the extra $300 a week, and the UI benefits continued. So if you didn’t find a job, you were still on UI and were still reflected here as being on UI even though you lost your $300 a week.
That would seem to indicate a weaker recovery in general. Funny how the media doesn’t tend to indicate that that might be the case.
The current economic performance is substantially fake and has been since 2008. Normalize (if can even be called that) federal budget deficits and the FRB’s balance sheet back to 2008 levels and all the fake grow disappears. The economy would probably crash, along with financial markets.
Before 2008 it was the real estate bubble. Before that, the tech bubble. Before it, the financialization bubbles. This country has not had an honest economy since the 80s. The only thing we have is the dollar.
NFP +235k.
Just need to print a bit more and soon all the rentiers will start creating jobs!
Friday Jobs report just came out. NO JOBS!!!!
Looks like Jim Cramer was right. Delta Variant + end of Fed UI checks = slumping economy = NO FED Taper!
J Powell has a green light to keep the fake money flowing
Incentivizing rentier activity over real wealth creation == no jobs.
Cramer is just part of the same flawed circle of jerks.
Powell keeping the ship steady will just sail you all further into the abyss.
“Friday Jobs report just came out. NO JOBS!!!!”
Nah. The well-known “August effect” where seasonal adjustments are HUGE and can be iffy. Plus lots of people still not wanting to return to work. June and July were revised up by a lot to total close to 2 million. Aug 235K was an outlier. This is based on surveys of “Establishments.”
Based on the surveys of households, over 500K jobs were created.
That household survey may not be the most accurate data set. The discrepancies between household survey and people receiving unemployment benefits have been rather large the last years. Doing a survey, when the numbers could be found by counting always raise suspicion by me.
Sams,
“Doing a survey, when the numbers could be found by counting always raise suspicion by me.”
The ONLY jobs-related data we have that is NOT survey based is the weekly unemployment claims data that I used in my article here.
ALL other jobs related data is based on surveys either of households or employers, and that includes the entire monthly jobs report that we got on Friday, which includes data from the “household survey” (which I mentioned in my comment) and data from the “establishment survey.”
There is NO ONE in the US that actually counts all the jobs and all the self-employed people, and all the people that work off the books. But you’re welcome to start counting if you wish.
The ENTIRE economy is measured by surveys, including retail sales, consumer spending, inventories, business spending, government spending, etc. GDP is a result of lots of surveys. If you don’t like surveys, and data derived from surveys, then don’t look at economic data.
Maybe I put a different thing into the word survey, but if the survey includes a report on the number of employed from all employers the counting has started.
And that is the point, to have system that make someone count the numbers. Then, several have more than one employer, banks and the tax office will know and can provide data.
Ok, cash workers and those with offshore bank accounts may slip past, but an estimate may be established. The company with office access systems have one datapoint, Google, Facebook and others can provide more.
Award Google or someone similar a contract and give them the right to acquire the required data and they will count and come up with the number. (And a lot more…)
Jim Cramer or Cosmo Cramer?
“It’s one thing to make those policy decisions at the federal government level, but it’s quite another thing that the mainstream media are trying to cover up the side effects of those policies.”
Yes, yes , yes! That’s why I read Wolf Street: not part of the ‘narrative.’
The mainstream media is unadulterated propaganda. Spooky, when you think about it…
MT,
I don’t think there is a “ mainstream media”…
All of these media products are for one point, to sell advertising to the group that tunes them in…
Pay attention to the commercials and you will see who they are slanting toward…
IE, CBS evening news… drug commercials for the older demographic…
NBC… cellphones, cars, etc…Poor folks can live the great life…
Fox… the blonde bimbos with the short skirts… them old white guys love that…
MSNBC… the charlatan Al Sharpton… about as reverend as my dog… trying to gain which demographic?…
Colbert… urban liberals… which is funny because of his Republican alter ego on Stewart…
And on and on…
The best I ever heard was when FOX News defended itself from criticism by claiming they were not a news channel, but an entertainment channel, named FOX News…
It takes a lot of effort to sift through the garbage…
Unfortunately, most people don’t and won’t make the effort…
They have actually argued in court that no reasonable person would construe anything Tucker said as truthful or factual.
The Kraken Sydney Powell has also argued this in court.
@C
Neat post
You don’t cover RT
Moscow Trolls we’re now being called.
Big stimmy checks are coming as well as continued QE, MBS purchases, low/negative rates, continued moratoriums on all types of loans, rent, etc. UBI and socialism are here with stagflation.
Wolf: I don’t expect the flood you do.
I’m sensing a wider, global, phenomenon underway of disengagement and exhaustion. I’m hearing reports from other managers in my network of the difficulties of keeping workers (not necessarily hiring them — keeping them). The anecdote of the tire shop here in the comments is a familiar story. Note that I live in a state that cancelled the extra UE as soon as it could, so even if someone could finagle a UE approval, it wouldn’t be any more generous than before the covid plus up.
If I were inclined to crunch the data, I’d calculate the labor force participation rates of states with and without UE plus up, before reconsidering my position. But, I still wouldn’t assume that the labor force would go to normal. Rather, I’d assume we’re in a new normal characterized by an exhausted, crushed labor force that’s much more willing to sacrifice their credit scores and future expectations of wealth and plenty in return for what they can get right here, right now by “working” the system.
After all — isn’t that what their employers do?
If you work for a decent company, you feel part of a common cause and give it your best. If you work for a company who states with every action they exist for their shareholders and their return, or in the case of a small company for the owner and owner’s family, you act accordingly.
I’ve worked for operations that I would delay pay cheques if they were suffering a temporary slowdown with receivables, because they needed a break and you knew they would not only pay up as soon as possible they would be thankful. And then there are those organisations you count up how many sick days you have left and when you might take them.
I think that is what is happening along with Covid. Many workers no longer feel valued so why should they give a rats ass about going back to work? Don’t blame the worker, management and ownership sets the tone in any organisation. In a winner takes most scenario that rewards labour begrudgingly, don’t whine when people look elsewhere or choose to stay home.
VERY good comment P, and one with which I have to agree SO much:
In my 60+ years in the construction industry I have worked for really good BIG international companies and really good small or medium companies ( by annual sales ) and equally bad baaad small and large…
Kudos to all of the good ones, and they all keep on keeping on their valued people, knowing full well that is the very berry basis of their successes.
I agree to a point. At some point, most everyone gets tired working harder to make someone else prosperous or wealthy.
I think the dominant influence in America today is that the bottom half of the population has given up any hope of improving their lives. They know that just working harder isn’t paying off. The jobs that paid more than subsistence wages no longer exist. If you want to blame the government then fine. The theory is that government supposedly exists to protect the people, including protecting their welfare. Not true. Blaming government for what supposedly was the private sector’s wheelhouse makes no common sense. After four decades of tax cuts and the privatization of public assets this is what we’ve created. Us. We did it. Stop whining. You are responsible.
CJH, to politely say this, just stand back and consider what your expectations would of been just 100 years ago and get off the “Victimhood train”.
Man in slave labour picking cotton in the fields complains to his master.
> you know what life was like in the stone age boy?
Technology and expectations have moved on in 100 years. This is not a valid riposte.
Its the basis of Capitalism.
Companies are not in the business to reward employees, but pay as little as possible and exact as profit as possible.
And individuals are in the business of bettering themselves to command higher returns, not hoping minimum wage is good enough to live on or the government will come to the rescue.
There is this simple dynamic, people compete with each other for resources and organizations take advantage of this competition. In this process, people end up getting better or not, in a very real way, it’s natural selection.
The odd thing though is that as government starts to intervene more and more, the unintended consequences pile up, and we end up with the degree of wealth inequality we see. One only has to take a look at the last twelve months to see the results.
But alas, this is the way.
This is why capitalism must be kept on a short leash. It soon devolves into feudalism.
Harrold/MCH-you need look no further than to the advent of revolving credit and a very-easy-to-use plastic card…
may we all find a better day.
WE the PEONS, (thanks UNamused, wherever you are, ) do not agree with you cjh, especially in re your, ”given up” meme…
The vast reason for SO many folks from SO many places around the entire world WANT to migrate to USA, legally and otherwise, is to improve their and especially their kids’ ”opportunity”…
This fact is very clearly documented these days and the last couple centuries or so, and my ancestors migrating here would be very happy to testify to that for the last couple centuries or so…
What all folks really need to consider in their thinking today is that the situation today is really NOT all that different than when my ancestors immigrated to USA,,,
IN SPITE of all the propaganda on both sides of that consideration…
IOW, in spite of all the BS,,, USA today is still a very very large country, geographically, with a very very large future,,, and, of course, with a very very large number of challenges of both the physical, psychological, sociological, chemical, etc., etc.
All of those challenges are ready, willing, and able to be ”done with” with increased focus on such,,,
rather than the currently pure imaginary challenges of ”financial assets” being approximately 6 times ”real assets.”
Until and unless such imaginary assets are done and gone, the pain and extraction from WE the Peons will continue.
We clearly need a several hundred million dollar Congressional investigation to come to the conclusion (or not) that is shown by “facts and data”.
The same diseased mental process that says 1+2= Orange.
Is there a breakdown of the number of unfilled jobs by salary or wage level, or even by type of jobs going unfilled? This data must exist somewhere.
Folks on the lower income levels, likely found that they earned more cash from liberal UI benefits. Which jobs are going unfilled, and who is staying home? Likely yhe ones below the average “premium” UI benefits.
When push comes to shove, when it comes to earnings, everyone is a Capitalist.
The JOLTS data provides some of this detail by industry, and I cover that when it comes out. Here is the last one:
https://wolfstreet.com/2021/08/09/amid-clamoring-of-labor-shortages-as-13-million-people-claim-unemployment-benefits-job-openings-spike-sky-high-across-many-sectors/
Just because they fell off the unemployment rolls doesn’t mean they have a job, most don’t. Look at the weekly new jobs data from this week, the worst in history.
Some of these high tech companies keep posting the same jobs month after month. Maybe they want to create the illusion they are hiring and can’t find qualified workers. I have read many of those postings for programmers. They are asking for phds and master’s degrees with 5 to sometimes over 10 years experience for programming jobs. People with those credentials don’t program anymore, they have people for that. Those companies don’t seem to know that, which is how I know the job posting is fake.
To hire foreign labour they have to post the job in the USA for a period, to “prove” that they cannot find the right person.
When I moved to Canada I wrote my own job description, to be advertised in Canada. It included a bunch of esoteric stuff I know in order to make it very, very unlikely we’d get applicants. We did not, here I am.
That job would have gone into the numbers. Not sure how you could filter out this noise, and obviously most jobs are not like this, however I think they are not an insignificant number.
Very true re “fake job” postings. I know of positions that never got filled pre pandemic and still sit there today unfilled. Got to wonder if the employer used those # in their PPP loans🤑🤑
P,
My rule is that looking for a job “ is” a job…
If you want a job, get off your a$$ and the cell phone and hit the streets.. you will find a job…
Quality people can always find a job if they can add value to the employer…
One time in my life, during a recession and in a new town, I “hit the streets” looking for a job. It was the most fruitless waste of time ever.
DC,
Porn didn’t count then….
I wasn’t talking about getting a job. I was referring to the fake postings which are there month after month from the companies that supposedly can’t find workers. These are the job numbers used to justify kicking people off unemployment.
I have followed positions at the biggest tech firms for the last year. Most have the same positions open. Some are now posting for entry level class of 2022, but not class of 2021. It’s a scam.
P,
Got it…
Misunderstood your context…
Doesn’t BLS use surveys, not any kind of actual data to make up most of their numbers?
I think I read somewhere where the BLS does a survey of ~60k households to get the employment data…
Aren’t most of these job sites trolling for site visits for ads?
Call me unimpressed with what I’ve seen from them…
But what do I know… every tv ad for a job site shows everybody getting a job just by using their site… another techno-miracle…
My ex-employer offered several schemes late last year and early this year to thin the employee count. They offered voluntary retirement (with juicy enhancements), voluntary separation packages and other incentives to cull the herd.
Fast forward to this week. They are now paying $1,000 to existing employees to head hunt for them. If the referral is hired, the existing employee gets the payout. Rumor is, no one wants to work in the operations side (warehousing, assembly line, CR, technical support and the likes).
Even more humorous is the consultant redesigned job grades and salary levels are already being thrown out the window. Those went into effect this past June. Applicants laugh at them when they see the pay scales vs. other similar positions in the industry. One of my ex-direct reports garnered a 50% increase in salary plus more extensive bonus doing the same job for another manufacturer.
So, there’s job openings…. but no one with the requisite skills / experience will work for what some companies want to pay.
Another “WTF” moment in the executive suite.
Years ago when Java had only been around for a couple of years, I saw a job posting for a Java programmer with 5 years of Java experience.
Maybe if someone was involved in the development of Java language, or a couple years drinking coffee experience could be substituted.
“Imagine a large industrial economy with no taxes on property, capital gains, or estates, and no national minimum wage. Such a conservative paradise, by Western standards, does exist: China.”
*note
The term “Conservative” has no meaning outside of the USA. Classical Liberal is the term the author is searching for.
From tax and fiscal policy standpoint, sort of true at a low level.
But for a business owner, not true, there is no rule of law and no real right to private property, no right to move you money offshore. Ask Jack Ma.
And of course no freedom of speech and the risk of being disappeared if you are a troublemaker.
The tone of this is rather depressing. Now that GDP is a national security issue. So we have forced labor (no labor camps?) The immediate result is that the Fed meets their employment mandate, tapers their bond buying, crashes the stock market, and Wolf’s short comes in. That’s a good thing. Meanwhile wage leverage has clearly swung to the workers. So if its a labor camp it’s a nice one anyway. Ultimately we are going to need a lot more automation, esp in the computer chip business. Can robots be trained to make themselves? We will find out.
I would say all of these numbers are likely still skewed by eviction moratoriums.
Rent is likely the single largest cost for any lower-end household; the ability to not pay rent means even a $100/week UE check is not a net cash flow loss for that week, much less the unknown numbers who are working under the table (the “not ender” states also tend to be the highest worker overhead cost states).
The “non-ability to pay rent” is far more onerous to the economy. and worker overhead in not ender states. FLA had good economic numbers, (not ender states say no to mandatory mask mandates) and the biggest worker overhead is healthcare even if you get Covid and you get better, you miss work, you need medication. There is no political liability for employers whose job place is a spreader event. Workers are pushing back, you are safe in your moratorium protected apt, how do you feel about the homeless shelter? In the end we are going to kill 1M people, in order to jack up GDP a bit, and make Powells job easier. I would say under the table is off the table for above reasons, so workers have less cushion than we think. I might also think if this keeps up the French Revolution will look like a pique-nique.
Capitalism works. It is better to pay people to do useful work than to pay them to do nothing. The deficit crisis is out of control.
Ending unemployment benefits promotes “capitalism”, but its capitalism for the poor, not the wealthy. If we really want capitalism, how about ending the government’s asset price preservation policy, also known as the “wealth effect” or “trickle down theory” that constitute socialism for the wealthy.
It boils down to this. The top 1% gets the bulk of government handouts in many different forms.
David,
I don’t disagree but my question would be at what wage level do you cross when being employed becomes a better deal?
For instance, would $40k a year (random number) and a loss of free food, free medical, free phone, subsidized housing and utilities and a score of other bennies be enough for to pull the trigger to the employment side?
Today’s capitalism won’t or can’t pay that….
A worker maxing out Social Security might get $36,000/yr. in retirement. There might also be a pension and 401k funds. Paid off a house and a car. Has an iPhone.
A bum collecting disability at age 45 will not have nearly as much. Might live in a drug infested Section 8 housing project where muggers prowl.
When HUD comes to town …
I live in a retirement community. When the hubbub around Covid got going in 2020, a lot of very elderly people who were still working part time (and volunteering) quit.
I don’t see them getting back into the labor force until Covid is either over, or under control. And when they do, they will have ageism counted against them.
NB. I see the two states that Wolf mentioned as early enders, Florida and Texas, both have big problems with Covid at this time.
The local employers here love older employees. Something about having a work ethic.
If the jobs report missed and it means the economy is near full employment then it’s time for Jay for taper.
To everyone here except SoCALjim, what are the best investments during period of stagflation?
They used to have books in the library about that sort of thing. There are plenty of investment advisors to take your money and give you advice. Not all of it works. If that was not bad enough, there is timing. A good investment last year might be a bad investment this year. Working a job or two might be a good start. I saw statistics about homeowners retiring better than renters. Learning health and nutrition might save $100k in medical bills.
The large gold miners are in good financial shape and have a cost to mine gold at about $1000 – $1100 per ounce. I think they tend to be a good place to be during stagflation.
Kirkland Lake. And uranium miners.
Do I get this right?
The government is borrowing money from the Fed to pay off people to keep the unemployment high so that the Fed can keep the interest rates low.
Magic!!!
The results are in. Giving free money to workers does NOT stimulate employment. Giving free money to business owners does NOT stimulate employment.
Wolf’s graphs say otherwise.
Huh? You looking at the same graphs?
Bobber,
I think Apple is talking about the whole series of WTF charts I have been posting for about a year, including retail sales, consumer spending, personal income, etc.
All these moneys paid to people and businesses do stimulate retail sales because people are going to buy stuff with this money :-]
Wolf, your chart shows that many people turn down work when they get free money. That’s bad for employment. Sure, the free money will be spent, which creates some temporary employment, mainly in china, but that is not lasting job growth built on productivity and real growth.
Likewise, we know what happens when the wealthy get free money, via tax cuts and corporate welfare programs. They bank it.
Free money is no cure for anything. It just accelerates activity and robs future generations.
Your WTF charts are kind of like watching the country go through a slow motion car wreck going over the course of 18+ months so far. It would be utterly fascinating if we weren’t all involved in this wreck.
My long time friend who lives in another state, Texas, has worked full time all through the pandemic and for the last 36 years. He had many chances of getting unemployment benefits on at least 5 times.
He instead focused on working in recent 7 years with 2 contract and part time jobs ranging from 25 to 30 hours a week each and wages from $22 to $26 an hour. So really 50 to 60 hour weeks for at least 50 weeks a year. It is mostly in transportation, shipping industry. The wife stayed home took care of both their kids for many years. She has a small home business the last 11 years now making pretty good money. The saved a ton in daycare and extra car, transportation expenses, other work related expenses.
The bottom line is they have managed to make smart, combined money decisions with a paid off modest house worth $490,000, no debts, no mortgage, no credit cards, IRA’s worth $375,000, longer term CD’s worth $195,000 and reserve fund in savings, short term CD’s, I-Bonds worth $85,000.
People are their own worse enemies trying to get something for nothing but they really end up hurting themselves in the longer run.
Craig, I think most would agree you shouldn’t expect something for nothing. However, let’s be clear about who has that expectation.
The main culprits are C-suite corporate officers, stockholders, politicians, etc. The burger flipper getting a lousy $300/month is a small part of the problem.
Didn’t we just hear that Afghanistan was a boon for the defense industry? I think it cost $300 million per day. And how about the CEOs who make $25,000 per hour for outsourcing US jobs? The PPP loan bailout recipients. The BBB bond investors. The T-bond investors and wealthy RE investors who raked it in while the Fed repressed interest rates for 40 years. All these groups are on government welfare.
I agree that inflation is getting out of hand but I knew long time ago the best way to deal with it is cooking and eating at home, only one car per household, no smoking, no eating out, no gambling, drinking for only a few times a year, no risky investments and leverage, borrowing alot, pay cash no credit with everything within reason, cars and major appliances, household items, pay off mortgage from 10 to 14 years or don’t bother buying a property to live in, save a minimum 25% of your gross income, maxout Tax deferred, tax advantaged investments, plans, never buy whole or permanent life insurance, always have 12 to 18 months of monthly living expenses saved in a short term liquid investment, account.
Our family has done this for 40 years now and retired in 2019 with 3.5 times our monthly income needed ($2,200 a month needed versus $7,700 month) income coming in. US long bonds, I-bonds, long term CD’s, REIT’s, mid term fixed term annuities, short term CD’s, savings accounts, social security monthly benefits is where we get and will get our retirement income for decades now.
Worked, set goals, achieved.
Craig and Paulo…same boat…never felt
Like we were going without.
Our children have greatly surpassed our income, own their own homes, save , and find their enjoyment with friends and family. Recipe is a simple one.
Ditto on all counts T10:
Really ”rather simple old boy/girl.”
Just STOP already with the personal wasting of your assets, financial, intellectual, and, especially, emotional,,, and you will be at least OK, if not totally driving YOUR own bus.
Otherwise, just bend over and take it from the vast and ongoing propaganda of the oligarchs who control MOST of what you are allowed to watch and read,,,
Fortunately, more and more folks who know how to do the ”stuff” that enables WE the Peons to have at least some access to reality in fact,,, are working hard to provide us,,, WE,,, with real news, etc.,
Many many thanks and support for WR,,, eh?
Paula Dononvan
I had 5 income streams planned in retirement. Two of them are yielding zero thanks to the Fed, and the pandemic. So I’m down to 3. One of the three involves working in a high stress job which is not what I bargained for.
Bottom line. I’ve struck out twice so far. So have a lot of others. But one more strikeout and I’m out.
Rents are over, don’t you understand? This is our entrance into commie land. Envy gets appeased and we’re all poor as shit.
Obesity goes through a thinning process … and everybody blames the other guy.
Wolf’s articles are pieces of the economic puzzle conundrum, yet put them all together and the image is of a reckless, ignorant Fed who has at this point unwittily trapped us all into a future stagflation hell. Ironically the Fed’s hidden third mandate to keep the everything bubble growing will result in perpetual QE taper delays via the excuse of creating more minimum wage jobs that have no chance in hell of keeping up with Fed induced stagflation. At this point it might make sense to give every American citizen $300 per week FOREVER if only the Fed would step away from both FOREVER QE and FOREVER interest rate suppression and allow a natural cleansing of the speculators and gamblers preying upon the economy. One needs to calculate the lesser of evils, and right now paying people to not work may be the least of our worries as the Fed has limited to no actual proven tools to deal with a stagflation future.
Again ironically, the Fed formula QE formula, either by design or arrogance, will keep part/product/commodity/service inflation at 2-5% until something breaks catastrophically, and then the Fed can scare Congress into an even bigger cockamamie future monetary experiment and even more Fed control over the global economy. Yet what plan can the Fed enact to stop stagflation that results from the current Fed induced mess???
At the same time, the govt’s roll will be to buy as many votes possible by throwing continuous free money at companies and people which will ironically ensure we have manufacturing/supply/shipping shortages and further massive labor shortages that drives up inflation yet the real economy, drowning in debt, will be hard pressed to run higher than 1% to 1.5% GDP by EOY 2022. Again, how can the Fed react to a stagflation future??? And better yet, how does one invest???
Perhaps Wolf can provide some puzzle pieces on stagflation, as it does seem to be a hot topic of a lot of financial titans who seem to be attempting to warn the Fed of a stagflation future for America…
I believe a deal has already been agreed to behind closed doors. Once Powell is re-appointed for another term as Fed Chief the Fed will implement a third mandate to address climate change. You can take this prediction and put it in the bank.
“At this point it might make sense to give every American citizen $300 per week FOREVER if only the Fed would step away from both FOREVER QE and FOREVER interest rate suppression and allow a natural cleansing of the speculators and gamblers preying upon the economy. One needs to calculate the lesser of evils, and right now paying people to not work may be the least of our worries as the Fed has limited to no actual proven tools to deal with a stagflation future.”
You seem to be incapable of connecting the dots between giving people money and the massive resulting inflation. Why? Doing more of that will lead to an even greater amount of pain. People cannot get it through their thick skulls that you cannot just give “free money” to people to spend without destroying pricing and giving rise to runaway inflation. C’mon, people, WAKE UP.
@Y
It’s not just the Fed, It’s the whole western global cabal.
We are all in it together, we need to call it out together, you are lucky you’ve got WS in the US to give you the truth and the chance to air your views, but don’t abandon the rest of us without such a platform.
“It’s one thing to make those policy decisions at the federal government level, but it’s quite another thing that the mainstream media are trying to cover up the side effects of those policies.”
Wolf – you know (surely) that the MSM are in the tank for the Democrats don’t you?
Surely this is obvious with Gavin Newsom & Larry Elder – the African-American White Supremacist from South-Central LA!!
Please – give me a break. Anyone who believes that rubbish is beyond hope!
“…in the tank for the Democrats”
For example, News Corp is not: it owns the Fox media outlets and the WSJ among many others.
Wolf, the problem with this methodology is that it doesn’t account for the states that ended benefits early for gig workers, freelancers, independent contractors, etc. Naturally those people would instantly be thrown off the rolls, whether or not they went back to work.
Also, some states may have simultaneously (with ending the extra $300) ended the extended time period for benefits, although I’m not sure about that; if so, it would again instantly throw a bunch of people off the rolls.
My methodology was never designed to account for everyone. It was designed a couple of months ago to find out if there is a broader trend one way or the other. And it does that. I make no claims about how many total jobs were filled because the extra $300 a week was ended. Goldman came up with an estimate of that type, but they used their own methodology to arrive at that number.
I was interested only in finding out if there is a trend, one way or the other. And there is a much bigger trend than I’d expected.
50% of country lives paycheck to paycheck. Many in service jobs with lots of face to face contact. Many of whom had friend stricken and die from covid. Many still scared to work those jobs. Many have pre existing conditions. Many can’t make ends meet without Pandemic Unemployment Insurance other than to go back to work. My point, these states removing extra $300 make un employed out as loafers and freeloaders when they might actually be getting by with benefits as a matter of life and death. Now it’s starve or go back to work in fear of covid. Or possibly bring covid back to their home with elderly or others at risk. But don’t worry about them, as long as we get our cheap burgers and hotel rooms. Collateral damage in interest of cbeap wage slavery.
Duke,
Way off the rails. This was about showing the side effects of policy decisions. Whether or not you approve of the policy decisions is one thing, as I pointed out in the article, but we need to know the side effects. And they have been getting a cover up. So I pointed out the side effects, like it or not. And sometimes, data just doesn’t fit the narrative.
Duke
A restaurant owner here in the DC Swamp just told me he couldn’t get anyone to come back to work. The workers are getting $600/week in Fed UI benefits + state UI + stimmie checks. They don’t have to pay their rent and are in debt on back rent for $17,000 which will be forgiven.
I don’t feel one bit of pity for these bums when they have to go back to work like the rest of us.
I know people who don’t want to clean hotel rooms or wait tables for fear of bringing covid home to their immunocomprimised kids.
So if Swamp Creature gets to call them “bums”, what am I allowed to call him?
I’ll let the reader come up with their own creative ‘terms of endearment’ I guess. His portrayal is the point of my ‘off the rails’ comment. Not directed at you WR but reply location chosen for most impact.
But again, the point of your methodology is that states ending the extra benefits had many more people go off the unemployment rolls because the extra benefits were their disincentive to work (on its surface a logical assumption), yet even they WERE looking for work the whole time they’d AUTOMATICALLY be off if they were gig workers or independent contractors (or if the state ended the extended time period). It thus says nothing about whether those people deliberately CHOSE to stay unemployed to collect the extra benefits.
If you can’t concede the logic of that (or have a logical response, rather than getting defensive), I’m both surprised and disappointed.
You’re mixing and mingling stuff to pull your point across by its hairs. I will continue to blow your thinking out of the water as more data becomes available over the next few months.
I would logically EXPECT you to be proven right, but for you to call my perfectly legitimate point “mixing and mangling stuff” rather than either acknowledging or factually refuting it demonstrates a disappointing intellectual insecurity on your part. Call me a former fan who shall now unsubscribe to your missives, as I feel that they’re no longer intellectually honest.
Goodbye.
I already answered that question several times. You just don’t accept the answer. So that is the end of the discussion because now it’s a waste of time because you refuse to accept what I already said about it.
Adios.
Hey Wolf, I trust your analysis, but The Indicator podcast from planet money (latest) highlighted analysis that came up with only slight difference between the two policies.
25% of unemployed went back to work in July when benefits lost. Vs.
21% of unemployed found jobs while still being eligible in those states.
And some of the economic gains of those returning to work were offset by spending slowing by all the others who lost benefits and didn’t get jobs.
Liberal spin? Different data?
https://www.npr.org/2021/09/07/1034965231/did-ending-pandemic-ui-benefits-push-americans-back-to-work
https://files.michaelstepner.com/pandemicUIexpiration-paper.pdf
Duke,
I will keep blowing these pieces out of the water as more data shows up. And I get tired of having to debunk each one of them. Why is it my job to debunk their shit?
If they used the July jobs report, they have nearly no data on the Enders. The surveys for the July jobs report were collected in mid-July and the reference period was the first two weeks of July. During that time, there was no data from the states that ended benefits toward the end of June or in July because it takes a while for people to find a job and for data to make it into the survey. All the big states were in that group.
So in the future, you can just read those articles and do with them whatever you want, but don’t drag them into here, and don’t ask me to debunk them.
Going forward, the bill for each debunk will be $10,000 taken directly and without permission from your checking account via reverse depo osmosis.
As a UBI fan, I like the idea that UBI helps keep the economy humming. Much like they are saying PUI has done. The concept is that a modest UBI is not a disincentive to workers. It’s an income floor to keep everyone in the game, gives labor slightly more bargaining power for their time, and could revitalize flyover country..
Ok. Thanks.
You are right. I should have sent YOUR article to THEM.
I’ll try to start a war on their FB post.
I do appreciate the answer because I don’t have the background to parse the data disconnect.
*KNOCK KNOCK*
“Who’s there?”
Hi! I’m from the government!! I’m here to lie to you!
Incentives always matter. It’s a universal truth of human nature.
The study of classical free market economics, and policies based on that, are just attempts to align with this, e.g. do not incentivize what you don’t want.
If you want people to be employed, don’t pay them to be unemployed.
You usually do not have to use force of government (violence/arms) to get people to do the right thing. If the government wants to make a bunch of changes to hand out money or force people to do things that they wouldn’t ordinarily do- there will always be unwanted consequences. (yes, always)
The CDC just recommended the unvaccinated not travel over Labor Day. The governor of Maryland, and County Executive recommended this back in Nov 2020 before vaccines were available. No one listened. He was right. 70% of the infections were traced to holiday travel and people staying at relatives houses. Now, with 50% of Americans unvaccinated and traveling like there is no tomorrow look for infections to spike right after Labor Day. Jim Cramer will be doing a dance on CNBC as the Delta Variant spreads and prevents the Fed from tapering. Its all about making money. The stock market will like that. The hell with people’s lives.
Wow!
People go to work when they need money, who would ever have guessed that?
Double Wow!
I always knew I was a weirdo because I never believed what an authority figure told me ever.(they always have an angle)
It’s now official, as a commenter here I’m in a 0.01% demographic. What I don’t get, is how can 200k to 400k people visit this site without feeling compelled to comment. I don’t comment anywhere else ever, apart from RT occasionally, never felt the need to, but I can’t resist it here.
Good raw data and as many takes as you could ever want, I only regret I can’t find anything similar in UK. You have a US treasure here.
I hope W’s security is good because otherwise I’m a dead man, CIA, MSM, MI6 ??? Although I’m now so old I’m demob happy and even a long sentence won’t be.
Good news! The extended Federal Unemployment benefits expired today. Noticed the golf course was half empty and I had no trouble getting a tee time. Had a great time. All the freeloaders will have to go to work and start paying taxes instead of sucking off the rest of us.