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Friday, September 7, 2012
August Numbers And (lack of) Job Creation
The latest economic status report and unemployment numbers are out. In August, unemployment dropped, slightly, to 8.1%. Again, on the surface, that appears as good news. However, workforce participation also dropped, meaning that decline in unemployment was, again, due to people leaving the workforce. That means that the net jobs "created" was near zero if not negative.
We now have the smallest workforce participation in the history of tracking the participation rate. If we had the workforce participation we had on January 1, 2009, the unemployment rate would be 11.2% with a much higher U6 rate, near 23%.
The news on the workforce participation rates raises curiosity about any correlation to SSDI recipients. In previous months, the decreased participation rate had a proportionate increase in SSDI applications, mostly due to "mental disabilities". If the trend holds, it indicates that more and more Americans have been severely depressed, to the point of chronic mental disorder, by the current administration. That could lead one to wonder if the federal politicians in office could be sued for "mental anguish". In any case, it indicates an even further strain on taxpayers, since Social Security is already nearly bankrupt.
In addition, both the June and July numbers were revised to higher than initially reported.
The reported increase in jobs created or personnel hired resided mostly in the food service profession. In other words, more people were hired to serve fast food or as waitresses and dishwashers. Most of those jobs are part-time and qualify as "under-employment". Those taking those jobs are listed as "marginally attached to the labor force".
So, former trained professionals are taking part-time jobs as fry cooks at Chik-Fil-A. The median tax bracket (often referred to as the "middle class") is working part-time at Taco Bell. That begs the question concerning where teens and lower-income bracket workers are employed, if at all.
The unemployment rate of personnel with a Bachelors' Degree or higher is still hovering around 4.1%, which is what the overall unemployment rate should be, while the rate for that demographic should be closer to 2.5%.
Operation Iraqi Freedom and Operation Enduring Freedom Veterans' unemployment remains near 11% with workforce participation decreasing at a more rapid rate than the civilian sector's rate. This means more and more veterans are giving up even seeking employment because the potential for employment looks dim. This is despite the incentives to hire veterans imposed by the federal government under the same bills that the IAVA praised as "positive" for veterans issues. If they were positive, they would have worked. They are failing. This is not how we take care of those who put their lives on the line to protect this great republic.
So what does this all mean? It means, in reality, we have even fewer adult citizens employed. It means that the current economic conditions set by federal regulations and tax codes, to include Obamacare, are motivating private companies to shrink their human capital. Those few companies that are expanding are hiring overqualified people into part-time positions normally held by teenagers. That means fewer opportunities for high school and college students to earn a wage and defray the costs of their education. It means the Keynesian plan is harming our economy.
This is the "hope and change" that Obama built during his tenure in office. Is this what his voters want? If you look at the effects created by Obamacare and combine them with the Democratic Party delegate's support for outlawing or capping profits, it looks as though this is exactly what they want -- everybody broke, unemployed, and miserable.