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Say Hello to Full Employment

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Re: Say Hello to Full Employment

#21

Post by ChrisLomont »

aero142 wrote: post #12
ProAm wrote: post #2

The national unemployment rate has always been political fodder and not a good indicator to the heath of people employed. Statistical smoke and mirrors considering they do not count people who've stopped looking for work because they cannot find it, those who are under-employed, or those who are earning less this year compared to last due to inflation and wage stagnation.

Stop getting your economics reports from political news sources. "They don't count people who've stopped looking" is not a meaningful statement. There are many statistics that report this. Labor force participation rate is the one I always look at next to unemployment rate and gives a better overall picture. https://data.bls.gov/timeseries/LNS11300000 In this case, I think you make a valid point. Why is the labor for…

A large part is demographics, and the drop was known for decades before it happened, as mentioned in papers from Census. FRED reports also explain this.

Another part is people staying in college longer (or going back to college) to get more education which is needed for a modern workforce, and the result of that is more lifetime earnings, not less.

A third part is many people are opting for one income, since many couples can now live on one income. More people moving from the middle class did so by moving up rather than down.

Re: Say Hello to Full Employment

#23

Post by ryandrake »

wgerard wrote: post #16
mgkimsal wrote: post #13

Earlier quoted context omitted.

this comes up a lot, and I can never find the actual questions that get asked on these surveys. do they mean an actual savings account at a bank? the kind that pay 0.02% interest? few people I know, even with high net worth and liquidity, have much of anything in a 'savings account'. But... "Only 41% of adults reported having enough in their savings account". Do they just mean 'savings'? Or liquid cash? I can never f…

> few people I know, even with high net worth and liquidity, have much of anything in a 'savings account' Really? It's fairly common advice to store an emergency fund in something akin to a savings account (or at least something with FDIC backing). Either way, it seems bizarre for a high net worth individual not to have at least $500 in something extremely liquid like a checking/savings account. Either way, it's fair…

> Really? It's fairly common advice to store an emergency fund in something akin to a savings account (or at least something with FDIC backing)

That’s where I have my emergency fund (earning nearly zero interest of course). If OP knows of some other type of account with enough liquidity to use as an emergency fund AND generates significant interest, you have my full attention!

Re: Say Hello to Full Employment

#24

Post by kirbypineapple »

saudioger wrote: post #7

We're also 9 years away from the end of the last recession. The longest we've gone without a recession in the past 100 years is 10 years.

We'll likely have an inverted yield curve before the end of 2018 for sure. Go back in history to see the correlation to past recessions:

https://fred.stlouisfed.org/series/T10Y2Y

Obviously it's not as simple as that but it certain implies that something uncommon is happening in the financial markets.

Re: Say Hello to Full Employment

#25

Post by ChrisLomont »

notarealaccount wrote: post #5
ProAm wrote: post #2

The national unemployment rate has always been political fodder and not a good indicator to the heath of people employed. Statistical smoke and mirrors considering they do not count people who've stopped looking for work because they cannot find it, those who are under-employed, or those who are earning less this year compared to last due to inflation and wage stagnation.

There is a worse not so hidden cost. The deficit is going from $600B to $1T, almost doubled. Instead of the government borrowing $3000 a year in my name it will be borrowing $5000 a year in my name which I or my children will have to pay back at some point. This way, down here in the South, all the dumb as coal red necks are very, very happy with their manual labor job that they drive their pickup to in the morning.…

>which I or my children will have to pay back at some point

Which is not as relevant as you think, since if your kids have to pay it in 50 years, deflation will have made it effective 1/4 as much or so. And if the current spending results in more total wealth at that point than if the spending was not done, then everyone is better off.

Not all deficit spending is bad economics, in the same way buying a house or paying for college is on average a positive economic move in the long run.

Re: Say Hello to Full Employment

#26

Post by dbjacobs »

aero142 wrote: post #12
ProAm wrote: post #2

The national unemployment rate has always been political fodder and not a good indicator to the heath of people employed. Statistical smoke and mirrors considering they do not count people who've stopped looking for work because they cannot find it, those who are under-employed, or those who are earning less this year compared to last due to inflation and wage stagnation.

Stop getting your economics reports from political news sources. "They don't count people who've stopped looking" is not a meaningful statement. There are many statistics that report this. Labor force participation rate is the one I always look at next to unemployment rate and gives a better overall picture. https://data.bls.gov/timeseries/LNS11300000 In this case, I think you make a valid point. Why is the labor for…

If you are going to look at participation rates, I find its best to look at the age, gender and race breakdowns to understand which changes are cyclical and which ones are driven more by demographics and cultural changes.

https://www.bls.gov/emp/tables/civilian-labor-force-particip...

For example, there have been huge upticks in 55+ labor participation rates and huge downtrend of teenager participation over the last 20 years.

Re: Say Hello to Full Employment

#27

Post by ChrisLomont »

exclusiv wrote: post #3
ProAm wrote: post #2

The national unemployment rate has always been political fodder and not a good indicator to the heath of people employed. Statistical smoke and mirrors considering they do not count people who've stopped looking for work because they cannot find it, those who are under-employed, or those who are earning less this year compared to last due to inflation and wage stagnation.

Agreed. Wage growth has been non-existant for a long time. Every administration is basically like "hey we're doing great - look at these unemployment numbers" and then you talk to people and they're saying the opposite. Savings is atrocious too. Some of that is people being bad with money but a lot is that the lack of wage growth and rising expenses on things like healthcare, education and home ownership makes it har…

>Wage growth has been non-existant for a long time

Wages grew at the fast rate on record in 2015. [1] Nearby years are similar.

Here's FRED real median household income [2]. Real wages have been growing for several years.

[2] https://fred.stlouisfed.org/series/MEHOINUSA672N

[1] https://www.washingtonpost.com/news/wonk/wp/2016/09/13/the-m...

Re: Say Hello to Full Employment

#28

Post by lainga »

wgerard wrote: post #8
sbjs wrote: post #4

"For the first time in recorded history, the number of job openings is higher than the number of people looking for a job." So what? If there's a thousand Node developers like me looking for work, and a thousand job openings for dentists, that's a mismatch. You may say beggars can't be choosers, but do they expect Node developers who went through CS courses to throw that away and take dentist courses?

The openings seem to be largely in trades or nonskilled labor: > Competition for workers has gone crazy, Joe McConville, who co-owns a popular chain of made-from-scratch pizza restaurants, told me. “At almost every restaurant that I’ve worked at, you always had a stack of applications waiting,” he said. “You’d call somebody up and half the time they're still looking for an extra job. That’s not happening anymore.” >…

The last sentence is the big problem. I feel like a lot of industries didn't just make the best of the advantageous labour market in the last 10 years, they reshaped themselves to become dependent on it (i.e., on cheap and easily-replaced human capital). Now that labour's tight again, they're finding that they've worked themselves into a hole they can't get out of.

Re: Say Hello to Full Employment

#29

Post by SketchySeaBeast »

hnlurker wrote: post #9
exclusiv wrote: post #3

Earlier quoted context omitted.

Agreed. Wage growth has been non-existant for a long time. Every administration is basically like "hey we're doing great - look at these unemployment numbers" and then you talk to people and they're saying the opposite. Savings is atrocious too. Some of that is people being bad with money but a lot is that the lack of wage growth and rising expenses on things like healthcare, education and home ownership makes it har…

Maybe they should stop playing the lottery? Average adult American spends over $300 per year on lottery tickets[0]. I'm all out of sympathy for smokers that get lung cancer, and other self-induced disasters. [0] https://www.fool.com/retirement/2017/01/07/heres-what-americ...

Saving that $300 a year at a highly unlikely 10% interest ends up being $36k after 25 years. It's not solving any problems. To even save up that $500 minimum would take 2 years. We can't just blame it on a single straw-man.

Re: Say Hello to Full Employment

#30

Post by civilian »

aero142 wrote: post #12
ProAm wrote: post #2

The national unemployment rate has always been political fodder and not a good indicator to the heath of people employed. Statistical smoke and mirrors considering they do not count people who've stopped looking for work because they cannot find it, those who are under-employed, or those who are earning less this year compared to last due to inflation and wage stagnation.

Stop getting your economics reports from political news sources. "They don't count people who've stopped looking" is not a meaningful statement. There are many statistics that report this. Labor force participation rate is the one I always look at next to unemployment rate and gives a better overall picture. https://data.bls.gov/timeseries/LNS11300000 In this case, I think you make a valid point. Why is the labor for…

Scott Alexander gets deep into labor force participation rate in those post (with lots of good charts!): http://slatestarcodex.com/2018/02/19/technological-unemploym...

A sister-comment mentioned baby boomers-- there's a second index called prime age male labor force participation rate (PAMLFPR) that corrects for that by only looking at working-age men. We've gone down from 97% PAMLFPR in 1948 to 88% PAMLFPR in 2016.

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