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True Rate of Unemployment

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Re: True Rate of Unemployment

#91

Post by DrProtic »

IanCal wrote: post #71
floro wrote: post #44

Everyone knows the stats are false but I don't know an alternative. I've been unemployed after graduating for a year and because I didn't use unemployment benefits I didn't show up in the statistics in switzerland. I know many cases like mine.

I’d be surprised if that’s how they measure it, it’s a common misunderstanding in the UK that this is what the stat means.

I my country you have to regularly check in with the bureau for unemployment to be included in the stats, even though that bureau hadn’t found a job for anyone ever.

I assume that’s how it works in many other countries.

Unemployed is the one actively looking for a job, not the one that’s just to working. At least that’s how governments seem to look at it, and their way of figuring out who’s looking is incorrect.

Re: True Rate of Unemployment

#92

Post by GolfPopper »

jandrewrogers wrote: post #38
xbmcuser wrote: post #17

Earlier quoted context omitted.

For me the true problem which most countries dont even acknowledge is low wealth and capital gains tax. Salaries are not enough because of land prices and the prices inflation it causes through out the economy. You bring down price of home land rent then price of everything else comes down. And their is a lot more economic activity as trillions of dollars are not parked in real estate for wealth generation.

Income from capital has a low tax rate in the US (and many other countries) because you can deduct neither losses due to inflation nor losses due to risk, both of which are substantial for capital income but non-existent for wage income. The lower tax rate is simpler than actually accounting for these differences. Treating wage and capital income equivalently would require recognizing losses due to inflation and risk…

>Treating wage and capital income equivalently would require recognizing losses due to inflation and risk that simply don’t exist in a meaningful way for wage income.

Learning that their wage income makes them immune to inflation and is risk-free seems like it may be surprising news to many Americans.

Re: True Rate of Unemployment

#93

Post by xelxebar »

From a cursory read of their white paper, my impression is that LISEP is trying to quantify the sense that making a livable income is harder and more disparate than it used to be. IMHO, this should be read as a campaign to improve and add precision to a political narrative more than an indictment of existing statistics.

In particular, the BLS in the US reports 6 different measures of unemployment, U-1 through U-6, each measuring something slightly different. LISEP adds another to the bunch; this is their operationalization:

> LISEP’s definition of “True” employment or unemployment accepts the U-3 rate for comparison purposes, but modifies it by adopting two important stipulations. The first stipulation deals with the workweek. To be employed for the purposes of LISEP’s true employment concept, an individual must either have a full-time job (35+ hours per week) or have a part-time job but no desire to be full-time (e.g., students). The second stipulation is that an individual must earn at least $20,000 annually. This annual wage is adjusted for inflation, calculated in January 2020 dollars.

The white paper gives their rationale for the $20,000 cutoff. The "true" name here is marketing, which might honestly be the right play here. My gut says that we already have better statistics than TRU but they smell dry and academic. I would be interested to hear more about their political strategy and philosophy.

FWIW, the institute looks to be chaired by https://en.wikipedia.org/wiki/Eugene_Ludwig.

Re: True Rate of Unemployment

#94

Post by therealdrag0 »

throw93949488 wrote: post #80
Aurornis wrote: post #51

Earlier quoted context omitted.

> there are too many jobs that do not pay enough to live on. I know this is argued as a reason for high unemployment on the internet, but it does not match my experience in the real world at all. Having a job that pays a little is more income than no job at all. People stuck with low paying jobs often have multiple jobs as a result.

Many jobs require additional expenses: car, commute, babysitting, living in expensive city, no insurance for work related injuries... So "not enough to live on" often means, it does not even pay job related expenses! Employees are subsidizing their employers! My partner had a good job offer, but is at home! Buying extra car, petrol, child care... We would loose 150euro a month...

Just because the job doesn’t pay your expenses doesn’t mean someone else out there won’t take it and be happy they have it.

Re: True Rate of Unemployment

#95

Post by moezd »

Time series also show a slanted worldview that real unemployment was worse in 90s. Have they not adjusted for dollar inflation? 1999 is really suspicious: Normally at 30-40% unemployment you fear for public unrest and uprising, did I miss an important piece of world history there?

Re: True Rate of Unemployment

#96

Post by jdw64 »

I am curious as to why the TRU is not adopted as a standard metric.

1.Corporations that sponsor scholars dislike it.

2.Politicians dislike it (because if TRU were adopted as the standard, the unemployment rate a critical metric for evaluating their political achievements—would drastically increase).

3.The current system fundamentally operates on legacy metrics, despite the widespread knowledge that they fail to accurately reflect reality.

It seems to me that TRU captures reality much better, so I am wondering why it is not widely used as the standard.

Re: True Rate of Unemployment

#97

Post by testing22321 »

runako wrote: post #11

Anybody who believes ~30% of the workforce was functionally unemployed in 1999 does not know what those words mean, or was not an adult in 1999. I get what they are trying to convey, but the stronger message is the more straightforward: there are too many jobs that do not pay enough to live on.

> there are too many jobs that do not pay enough to live on.

That may be the case in the US, but not so in other countries.

For example in Australia minimum wage is $26.44/hr. But If you don’t have a job, you can get between $740 and $1047 every two weeks as welfare, forever.

Employers know this. Employees know this. So a job has to pay decently more than that or else nobody will do it.

Re: True Rate of Unemployment

#98

Post by ElProlactin »

bpodgursky wrote: post #70
ElProlactin wrote: post #57

Earlier quoted context omitted.

> ...you can live a pretty decent life on $50k in most of the US. Where? And what's the size of the household? It's one thing to make $50,000/year as a single young person sharing an apartment with 2 other people. It's another to be a family of 4. > Don’t exaggerate what is required for a decent quality of life in America. It doesn’t benefit anyone. "Decent" is subjective, but we can look at hard numbers. After taxes…

> After taxes, $50,000 will be somewhere between $39,000 and $42,000 in much of the US NO. WRONG. Read what I actually said. This was after transfers, at the OP's income range US income tax is NEGATIVE and puts you at the $49,000 I cited.

> NO. WRONG.

Yelling doesn't prove your point, and you conveniently avoided answering the most important questions, like where and what household size?

First, there is no credit that offsets payroll tax.

A single person with $50,000/year income is not negative. They'd have about ~$34,000 in taxable income and pay ~$3,800 in federal income tax. A 2 person household filing jointly with no kids would still pay about $1,800.

A family of 4 (2 children) with $50,000/year gross income gets a benefit and probably keeps all of that (or a bit more) in take-home after the standard deduction, child tax credit, EITC. At 155% of the poverty line, they're probably above the SNAP gross-income cutoff but they'd probably get ACA premium subsidies and reduced-price school meals.

But they're still living at 50% of the median household income for a family of 4 and you'd have to explain how you think 4 people living on $4,100/month is anywhere near decent or easy in most of the US. The median rent alone for a 2 bedroom in the US eats up over 40% of that amount.

A family of 3 (1 child) in most states will not be negative after payroll and state tax at $50,000/year gross household income.

Re: True Rate of Unemployment

#99

Post by bertmuir »

ryan_lane wrote: post #29
jaredklewis wrote: post #26

Earlier quoted context omitted.

A land value tax would fix rich people parking money in real estate. A wealth tax or capital gains tax would not.

If a land value tax would fix rich people from parking money in real estate, it would price regular people out of real estate. I know LVT is the libertarian dream, but in practice it means only the rich can own real estate long-term, in most cities. It also means the rich can drive out the poor by driving up land values around them, to the point where the taxes are too much to afford. LVT simply wouldn't be a good sy…

You may be confusing LVT with property transfer tax? LVT is a tax on ownership of land - driving down land value, not up.

In practice it disincentivises investment in land (rent-seeking and speculative land hoarding) while incentivising land development. In cities this manifests as more, cheaper, homes, and lower rents, and is highly progressive.

I say in practice because we have over a century of explicit and implicit LVT implementations in the real world to demonstrate this. Most implementations of LVT have gone down as described. Estonia is a pretty fantastic case study - 90% of property is owner-occupier! And you might find this new study of implicit LVT in the US interesting - LVT correlates with higher earnings and demographic diversity: https://www.sciencedirect.com/science/article/pii/S004727272...

The challenges for LVT are really about how to transition the tax in for areas that are occupied, but severely underdeveloped. If a low-density inner-city area ought to be high-density, the owners are being charged accordingly. Long term, it stimulates development and the new housing surplus (splitting the tax burden of LVT across a much greater number of owners) balances things out. But that's no consolation to the people being told they have to pay tax on their backyard as if it's already a block of flats.

Re: True Rate of Unemployment

#100

Post by seanmcdirmid »

ElProlactin wrote: post #98
bpodgursky wrote: post #70

Earlier quoted context omitted.

> After taxes, $50,000 will be somewhere between $39,000 and $42,000 in much of the US NO. WRONG. Read what I actually said. This was after transfers, at the OP's income range US income tax is NEGATIVE and puts you at the $49,000 I cited.

> NO. WRONG. Yelling doesn't prove your point, and you conveniently avoided answering the most important questions, like where and what household size? First, there is no credit that offsets payroll tax. A single person with $50,000/year income is not negative. They'd have about ~$34,000 in taxable income and pay ~$3,800 in federal income tax. A 2 person household filing jointly with no kids would still pay about $1,…

Poor people pay payroll taxes, which usually is flat and doesn’t have a big deduction. At $50k, a single person is paying just as much if not slightly more in payroll as they are in income tax.
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