Say Hello to Full Employment • Hacker News Board

Re: Say Hello to Full Employment

#91

Post by rdlecler1 » Fri, Jul 06, 2018, 7:20 PM UTC

lainga wrote: post #28

wgerard wrote: post #8

Earlier quoted context omitted.

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.

This is one of the most insightful comments I’ve seen for awhile. Perhaps this is why low wages tend to create recessions as inefficient businesses start to fail. One could argue that these system stressors act as a cleansing agent.

Re: Say Hello to Full Employment

#92

Post by tonyedgecombe » Fri, Jul 06, 2018, 7:20 PM UTC

adventured wrote: post #54

lainga wrote: post #28

Earlier quoted context omitted.

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.

Business just got a massive tax cut. They can dig themselves out by spending on increasing productivity and paying higher wages. The economy needs to be run very hot for an extended period of time, instead of getting crashed by an obnoxiously over-eager Fed that likes to kick the economy into a recession to dampen wage growth for the benefit of businesses in the guise of controlling inflation. Businesses need to be m…

Not much point increasing wages if you are just going to erode them with inflation.

Re: Say Hello to Full Employment

#93

Post by User23 » Fri, Jul 06, 2018, 7:21 PM UTC

joefranklinsrs wrote: post #88

User23 wrote: post #83

Earlier quoted context omitted.

Past performance is no guarantee of future results.

Yup, you also want to look at macroeconomic conditions around the world, tech trends, demographics, etc. For example, 10 years ago we had quantitative easing done by US/Europe, which led to subprime loans. Now, all of the major economies around the world is tapped out with QE, so deflation is the theme going forward Also, 10 years ago the dollar prime rate was 0%. Now it's close to 2%. That drives the emerging market…

Also the US federal government has been spending an extra $1 trillion in stimulus into the economy since 2009. We've had continuing budget resolutions since the ARRA was passed, and those always continue spending at the prior year's level. This is why the deficit went up $10 trillion. Or, if you're a half full kind of person, it's why private sector and foreign savings have gone up $10 trillion. Unfortunately it doesn't appear much of those new financial assets ended up in the hands of the so-called middle class.

Re: Say Hello to Full Employment

#94

Post by chrisfinazzo » Fri, Jul 06, 2018, 7:24 PM UTC

dbjacobs wrote: post #26

aero142 wrote: post #12

Earlier quoted context omitted.

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…

I assume these stats are cumulative in terms of PT, FT, or a shared arrangement?

Still, feels odd to see the metrics begin at 16. While some people I know (myself included) had part time jobs at that point, most didn't. 21-22 seems like a more reasonable starting point, given time off for people who went to college - or 18 for people who didn't.

Seems like they should isolate these such that when they say "The unemployment rate is X and the participation rate is Y" they acknowledge most 16 y/o are not primary breadwinners.

Re: Say Hello to Full Employment

#95

Post by chrisfinazzo » Fri, Jul 06, 2018, 7:26 PM UTC

ChrisLomont wrote: post #18

ProAm wrote: post #15

Earlier quoted context omitted.

It helps that we've been at war for ~17 years straight and are still largely quantitatively easing things.

Wars don't tend to grow economies, and QE stopped in 2014.

Tell me again how WWII didn't end the Depression because of the massive demand for workers and the associated economic activity they generated?

Confused...

Re: Say Hello to Full Employment

#96

Post by quotemstr » Fri, Jul 06, 2018, 7:29 PM UTC

kirbypineapple wrote: post #24

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.

One wonders about the extent to which this correlation is a self-fulfilling prophesy. If everyone gets skittish when indicators look too good and reduce investment, they end up causing the recession that they predict!

Re: Say Hello to Full Employment

#97

Post by joefranklinsrs » Fri, Jul 06, 2018, 7:30 PM UTC

User23 wrote: post #93

joefranklinsrs wrote: post #88

Earlier quoted context omitted.

Yup, you also want to look at macroeconomic conditions around the world, tech trends, demographics, etc. For example, 10 years ago we had quantitative easing done by US/Europe, which led to subprime loans. Now, all of the major economies around the world is tapped out with QE, so deflation is the theme going forward Also, 10 years ago the dollar prime rate was 0%. Now it's close to 2%. That drives the emerging market…

Also the US federal government has been spending an extra $1 trillion in stimulus into the economy since 2009. We've had continuing budget resolutions since the ARRA was passed, and those always continue spending at the prior year's level. This is why the deficit went up $10 trillion. Or, if you're a half full kind of person, it's why private sector and foreign savings have gone up $10 trillion. Unfortunately it does…

If US is the beneficiary of the past few years of emerging markets deleveraging and economic stimulus, middle class is a big recipient of the benefits. For example, any middle class who invested in the stock market would have seen great returns, maybe close to 10X if they invested in amazon, netflix, or apple. also, US middle class income has been increasing, reaching highest level in the last year: https://www.washingtonpost.com/business/economy/us-middle-cl....

Re: Say Hello to Full Employment

#98

Post by monocasa » Fri, Jul 06, 2018, 7:32 PM UTC

ChrisLomont wrote: post #18

ProAm wrote: post #15

Earlier quoted context omitted.

It helps that we've been at war for ~17 years straight and are still largely quantitatively easing things.

Wars don't tend to grow economies, and QE stopped in 2014.

They do if you win, and don't fight the war on your own soil.

Re: Say Hello to Full Employment

#99

Post by notarealaccount » Fri, Jul 06, 2018, 7:34 PM UTC

polotics wrote: post #62

ChrisLomont wrote: post #25

Earlier quoted context omitted.

>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 payin…

You wrote deflation, but I think you meant inflation: with deflation the purchasing power of the $5000 borrowed would go up, not down.

Either word, this commenter, doesn't know too much about what they are commenting on.

Re: Say Hello to Full Employment

#100

Post by User23 » Fri, Jul 06, 2018, 7:34 PM UTC

joefranklinsrs wrote: post #97

User23 wrote: post #93

Earlier quoted context omitted.

Also the US federal government has been spending an extra $1 trillion in stimulus into the economy since 2009. We've had continuing budget resolutions since the ARRA was passed, and those always continue spending at the prior year's level. This is why the deficit went up $10 trillion. Or, if you're a half full kind of person, it's why private sector and foreign savings have gone up $10 trillion. Unfortunately it does…

If US is the beneficiary of the past few years of emerging markets deleveraging and economic stimulus, middle class is a big recipient of the benefits. For example, any middle class who invested in the stock market would have seen great returns, maybe close to 10X if they invested in amazon, netflix, or apple. also, US middle class income has been increasing, reaching highest level in the last year: https://www.washi…

For those of is comfortably in the top quintile, this is no doubt true. I'm certain many of us who post here have done quite well over the last decade. However the historical American middle class has, by and large, not benefited nearly as much. The vast majority of the gains have been captured by the top 0.1%.

Please don't mistake me for some kind of commie, PG's essay on the necessity for income inequality to drive innovation is convincing. But that doesn't mean we should celebrate shameless cronyism, kickbacks, and rent-seeking either.

Growing middle class income is nice, but income is a very poor metric to use to determine economic class. Net worth is what really matters.