Tag Archives: Jobs Creation

Obama Hands Trump Rising Economy: November Continues Record Job Growth, Lowest Unemployment Since 2007

December 3, 2016 krubin

With Donald Trump continuing to rewrite history, advance falsehoods about Obama’s Presidency, it is important to examine the Employment report for November. Trumpsters depend upon disaffection and dissatisfaction. A strong economy is the antithesis. Also, Trump wants to take credit as the forward momentum of Obama’s policies continue on into the new administration, before the administration’s policies, undoing everything Obama accomplished, have their impact.

Trump was able to exploit years of propaganda from the Republicans aimed at destroying his presidency. Obama found a way to thread the needle in coming up with solutions, despite unprecedented obstruction of infrastructure spending, the America Jobs Act, spending for transportation and highways, defeating his plans to build high-speed rail and invest in clean, renewable energy.

Obama was almost a victim of his own success – like President Bill Clinton before him, who presided over a golden era of peace and prosperity, when everyone’s income and standard of living rose, only to see Al Gore denied the presidency – people take for granted how much better they are off from when Obama took office, when 850,000 jobs a month were being lost, 20,000 people a month were losing their health care, millions were losing their homes to foreclosure.

Obama also had in place programs to help the people who found themselves unable to pursue the 5.5 million unfilled jobs because of lack of training. He had programs to boost advanced manufacture, and open up markets to the 95% of the world that is outside the US.

Trump is profiting from being handed a growing economy, and he has signaled he will install the very same people who profited from millions of Americans misery, he will undo the financial and consumer protections, he will throw people back into the insecurity of losing health insurance and jobs and homes. He has shown in his appointments and in his business record that he will exploit workers and further weaken unions.

Statement on the Employment Situation in November

WASHINGTON, DC – Jason Furman, Chairman of the Council of Economic Advisers, issued the following statement today on the employment situation in November.

Summary: The economy added 178,000 jobs in November, extending the longest streak of total job growth on record, as the unemployment rate fell to 4.6 percent.

The economy added a solid 178,000 jobs in November as the longest streak of total job growth on record continued. U.S. businesses have now added 15.6 million jobs since early 2010. The unemployment rate fell to 4.6 percent in November, its lowest level since August 2007, and the broadest measure of underemployment fell for the second month in a row. Average hourly earnings for private employees have increased at an annual rate of 2.7 percent so far in 2016, faster than the pace of inflation. Nevertheless, more work remains to ensure that the benefits of the recovery are broadly shared, including opening new markets to U.S. exports; taking steps to spur competition to benefit consumers, workers, and entrepreneurs; and raising the minimum wage.

FIVE KEY POINTS ON THE LABOR MARKET IN NOVEMBER 2016

1. U.S. businesses have now added 15.6 million jobs since private-sector job growth turned positive in early 2010. Today, we learned that private employment rose by 156,000 jobs in November. Total nonfarm employment rose by 178,000 jobs, in line with the monthly average for 2016 so far and substantially higher than the pace of about 80,000 jobs per month that CEA estimates is necessary to maintain a low and stable unemployment rate given the impact of demographic trends on labor force participation.

In November, the unemployment rate fell to 4.6 percent, its lowest level since August 2007. The labor force participation rate ticked down, though it is largely unchanged over the last three years (see point 3 below). The U-6 rate, the broadest official measure of labor underutilization fell 0.2 percentage point for the second month in a row in part due to a reduction in the number of employees working part-time for economic reasons. (The U-6 rate is the only official measure of underutilization that has not already fallen below its pre-recession average.) So far in 2016, nominal hourly earnings for private-sector workers have increased at an annual rate of 2.7 percent, faster than the pace of inflation (1.6 percent as of October, the most recent data available).

2. New CEA analysis finds that State minimum wage increases since 2013 contributed to substantial wage increases for workers in low-wage jobs, with no discernible impact on employment. In his 2013 State of the Union address, President Obama called on Congress to raise the Federal minimum wage, which has remained at $7.25 an hour since 2009. Even as Congress has failed to act, 18 States and the District of Columbia—along with dozens of local government jurisdictions—have answered the President’s call to action and have raised their minimum wages. (In addition to the States that have already raised their minimum wages, voters in four States approved measures to raise the minimum wage in November.) To assess the impact of minimum wage increases implemented by States in recent years, CEA analyzed data from the payroll survey for workers in the leisure and hospitality industry—a group who tend to earn lower wages than those in other major industry groups and thus are most likely to be affected by changes in the minimum wage. As the chart below shows, hourly earnings grew substantially faster for leisure and hospitality workers in States that raised their minimum wages than in States that did not. By comparing trends in wage growth for the two groups, CEA estimates that increases in the minimum wage led to an increase of roughly 6.6 percent in average wages for these workers. At the same time—consistent with a large body of economic research that has tended to find little or no impact of past minimum wage increases on employment—leisure and hospitality employment followed virtually identical trends in States that did and did not raise their minimum wage since 2013. (See here for more details on CEA’s analysis.)

3. The strengthening labor market is drawing individuals into the labor force, offsetting downward pressure on employment growth from the aging of the population. Employment growth depends on three factors: population growth, the rate at which the population participates in the labor force, and the share of the labor force that is employed. The chart below decomposes employment growth (from the household survey) into contributions from each of these factors for each year of the current recovery. It further decomposes labor force participation into shifts attributable to demographics (such as the aging of the U.S. population) and shifts attributable to other factors (such as the business cycle). Throughout the recovery, demographic changes in labor force participation—primarily driven by a large increase in retirement by baby boomers that began in 2008—have consistently weighed on employment growth. In recent years, however, non-demographic changes in labor force participation have supported employment growth, as the strengthening of the labor market and increasing real wages have drawn more individuals into the labor force. The entry (or reentry) of workers into the labor force has helped employment growth maintain its recent solid pace even as the unemployment rate has fallen more slowly. These two shifts in labor force participation—demographic and non-demographic—have largely offset one another in recent months, and as a result the overall labor force participation rate has remained broadly stable since the end of 2013.

4. The number of unemployed workers per job opening, an indicator of labor market slack, is near its lowest level prior to the recession. Using data from the household survey and the Job Openings and Labor Turnover Survey, the chart below plots the ratio of unemployed workers to total job openings. In the recession, unemployment rose rapidly while job openings plummeted, sending the ratio of unemployed workers to job openings to a record peak of 6.6 in July 2009. As the unemployment rate has decreased over the course of the recovery, and as job openings have climbed to record highs this year, the ratio of unemployed workers to openings has fallen steeply, standing at 1.4 as of September (the most recent data available for openings). This is close to the ratio’s lowest level in the 2000s expansion, another indicator—in addition to recent increases in real wages—of a strengthening labor market.

5. The distribution of job growth across industries in November diverged from the pattern over the past year. Above-average gains relative to the past year were seen in professional and business services (+49,000, excluding temporary help services), while mining and logging (which includes oil extraction) posted a gain (+2,000) for the second time in recent months amid moderation in oil prices. On the other hand, retail trade (-8,000), information services (-10,000), and financial activities (+6,000) all saw weaker-than-average growth. Slow global growth has continued to weigh on the manufacturing sector, which is more export-oriented than other industries and which posted a loss of 4,000 jobs in November. Across the 17 industries shown below, the correlation between the most recent one-month percent change and the average percent change over the last twelve months was -0.06, the lowest level since September 2012.

As the Administration stresses every month, the monthly employment and unemployment figures can be volatile, and payroll employment estimates can be subject to substantial revision. Therefore, it is important not to read too much into any one monthly report, and it is informative to consider each report in the context of other data as they become available.

Election 2016, Presidential Campaign 2016

The ‘Trumped-Up Trickle-Down’ Businessman Versus ‘Inclusive Economy’ Politician

October 2, 2016 krubin

First match-up between Donald Trump and Hillary Clinton at the first presidential debate, held at Hofstra University, Long Island, September 26, 2016, was no match © 2016 Karen Rubin/news-photos-features.com

By Karen Rubin, News & Photo Features

The primary “appeal” of Donald Trump’s candidacy, we are told, is that he is a businessman, not a politician, that he has created jobs, whereas Hillary Clinton is a “politician” who has never created a single job or met a payroll. Donald Trump is the outsider, the change agent, versus the insider, while Hillary Clinton is “the Establishment” because she has spent 30 years as a public servant.

Setting aside the fact that Trump is the worst caricature of a Businessman, who, records now show, has built up the fortune he inherited by exploiting others, by lying and cheating, and the fact that Hillary Clinton, while she has spent her life in public service working to better the lives of others, has only briefly (as a US Senator and in her campaign for the presidency been a politician, there is a difference between public service and politics, and between business and government.

Trump says that because he is such a brilliant businessman, he will be the best “jobs creator God ever made.” He promises to bring back the manufacturing jobs that were lost 20 years ago, and says he will restore jobs in the coal mines, oil rigs and steel mills. How? He says he will tear up trade agreements (that will only start a trade war as countries retaliate by imposing tariffs on American goods, which will damage our exports which has been rising); tax goods brought in by an American company (even if he could do that, it would only be passed on to consumers in higher prices), eliminate corporate taxes (the biggest, most profitable companies don’t pay any tax anyway, and no business pays the “nominal” 35% tax rate), reducing taxes on the wealthiest Americans, like Trump (who we find pays zero or less than the average janitor so one wonders why there is any compelling need to go to a flat tax of 15% which will harm middle class people the most), and finally, eliminate the estate tax which would produce a $4 billion windfall for the Trump kids (so they have a real investment in Daddy becoming president) if Trump is not actually lying about his wealth (which Forbes estimates is more like $3.7 billion than the $10 billion he boasts). Trump’s fantastical promise of 4% annual growth in GDP that he pulls out of thin air would likely only spur crippling inflation.

This is, as Hillary Clinton so eloquently put it, “Trumped Up Trickle Down”, the George W. Bush economy on steroids, and we saw how that played out. And just like Bush Economics turned the Bill Clinton budget surplus into massive deficit and the $1 trillion for war he put on a national credit card exploded the national debt, economists have said that Trump’s economic plan would add $5 trillion to the debt, cost 3.5 million jobs, and exacerbate income inequality (because once again, all the tax advantages would flow to the top) and very likely plunge the US into another recession,

Hillary Clinton’s economic policy has a lot to do with economic justice and sustainable economic growth: paid parental leave, raising the federal minimum wage to $15, eliminating college debt, clawing back tax incentives from companies that use “inversion” to avoid taxes, promoting the rise of clean energy industry which already is creating more jobs than fossil fuel industry, easing the way for small businesses and entrepreneurs, investing $275 billion in infrastructure and billions more for medical research such as to combat Alzheimer’s disease, promoting universal pre-K and affordable child care, requiring pay parity for women. And yes, she pays for it by eliminating tax dodges corporations use and raising taxes on the wealthiest, “because they have made all the gains in the economy. And I think it’s time that the wealthy and corporations paid their fair share to support this country. Broad-based, inclusive growth is what we need in America, not more advantages for people at the very top.”

To which Trump replied, “Typical politician. All talk, no action. Sounds good, doesn’t work.”

Not work? These are policies that actually will create jobs – as they did during Bill Clinton’s administration, when he created 22 million jobs, largely by unleashing the new Internet industry, when incomes across the board were created, and by Barack Obama who already has created 15 million, despite coming into office enduring the worst recession since the Great Recession, produced the longest string of jobs growth in history and the fastest increase in wages in years and the most rapid decrease in poverty since 1968 (Johnson’s Great Society).

Yes, a politician does create jobs by fostering the policies that promote jobs-creation, and literally hiring the private contractors who build the roads, bridges, airports, water and communications systems. But a public servant does even more.

Economists who analyzed Hillary Clinton’s proposals found that it would likely create 10 million jobs, and that means with the increased revenue because of fairer tax policies and getting the wealthy and corporations to pay their fair share, the national debt would be reduced and prosperity would be more widely shared.

Hillary Clinton has spent her entire working life creating jobs. And if you look at what the State Department does – things like USAID – they are in the business of fostering economic development (jobs) around the world. During her tenure as Secretary of State, the US increased its exports by 30% and exports to China by 50%, and that contributed to the first increase in manufacturing jobs since the Clinton years. The Clinton Global Initiative which she served after leaving government, devised new methods of fostering public-private partnerships that have been applied by the Obama Administration in the Smart Cities program, Joining Forces (which promotes jobs for returning veterans and military families), in its Apprenticeship program, for example (I’m betting no one realizes these programs even exist), and would have done far, far more if the Republican Congress had not blocked legislation including the Infrastructure Bank and the American Jobs Program (it even has “jobs” in its name).

And there is a very great difference between being a businessman and a public servant. Donald Trump said it himself, to justify how “smart” he is to avoid paying taxes (which is probably why he is being audited):

He has said that he earned $650 million last year, but has boasted about paying zero taxes or avoiding paying taxes. “That makes me smart.”

“So if he’s paid zero, that means zero for troops, zero for vets, zero for schools or health,” Clinton replied. (This doesn’t sway Trump’s supporters because they see not paying taxes as stiffing the government – sticking it to the Establishment – and though they pretend to salute the flag, it is the “Don’t Tread on Me” one.)

And if he stiffed workers by refusing to pay them and challenging them to bring him to court, and stiffed investors by declaring bankruptcies, and called himself the “King of Debt,” he says, “Which our country should do, too.”

His idea to bring down the national debt? Not pay the interest on the obligations – force creditors to take less. That’s called default and it would forever crash the “full faith and credit of the United States” and the world economy.

“My obligation right now is to do well for myself, my family, my employees, for my companies. And that’s what I do.”

Ah ha, that’s it in a nutshell: a for-profit charter school can simply close up shop and leave the kids on the street, a public school has to take everyone regardless of their intellectual or physical ability; a for-private hospital just shuts down. A public servant has to consider all constituencies, with competing interests, not just self-interest, has a broader responsibility beyond a “fiduciary” responsibility (which is why corporations should be prohibited from paying into any political campaign and the Supreme Court Citizens United decision is so counter to democracy), and a longer view beyond the next quarter.

And the icing on the cake for would-be Donald Trumps? Elimination of regulation, overturning financial controls like Dodd-Frank, the EPA – an open invitation for a bankster free-for-all that will make the Bush Financial Crash look like peanuts. And those blue-collar working stiffs who are the “core” Trump supporters, who somehow imagine that Trump will make them billionaires, too? They will find themselves bilked, just like the Trump University chumps.

Being the chief executive of the United States, the head of a government of millions of workers, serving the interests of more than 300 million citizens (not just those who vote for you), working with partners from around the country and around the world, managing your board of directors (the Congress), is not like being CEO of a business with a single purpose – to make money for its owners – but does require professional skill, experience, expertise.

You wouldn’t hire a real estate developer to perform brain surgery on you, pilot your airplane, or plead for your life in court, would you?

But regardless of Businessman or Public Servant, it comes down to the individual’s own character, personality, temperament, skill, background, values and vision. It’s not that government is inherently bad, bloated and inefficient, or that businesses are inherently more productive, efficient and honest (if that were true, so many wouldn’t go bankrupt or be overcharging government by three and four times), but the workers we encounter at the hotel or country club, the factory workers who actually assemble the cars, and the people who get hired for government, and most importantly, the individual politicians we elect to office. As easy as it is for Trump to hurl stereotypes, slogans or jingoisms, people are not widgets that are interchangeable by label or category.

Responding to the New York Times report that Trump took advantage of his business failures in the 1990s to claim a $915 million loss in 1995 – enough to shield him from federal taxes for 18 years – his campaign stated, “The incredible skills Mr. Trump has shown in building his business are the skills we need to rebuild this country.”

Heaven forbid a President Trump treat the country as he has his businesses, his workers, his contractors, his investors.

________________________________

© 2016 News & Photo Features Syndicate, a division of Workstyles, Inc. All rights reserved. For editorial feature and photo information, go to www.news-photos-features.com, email [email protected]. Blogging at www.dailykos.com/blogs/NewsPhotosFeatures. ‘Like’ us on facebook.com/NewsPhotoFeatures, Tweet @KarenBRubin

Economic Policies, Economy, Jobs

White House: Economy Adds 151,000 Jobs in August; Unemployment Rate, Labor Force Participation Rate Hold Steady

September 2, 2016 krubin

WASHINGTON, DC – Jason Furman, Chairman of the Council of Economic Advisers, issued the following statement today on the employment situation in August. You can view the statement HERE.

The economy added 151,000 jobs in August following robust job growth in both June and July as the unemployment rate held steady at 4.9 percent. U.S. businesses have now added 15.1 million jobs since early 2010, and the longest streak of total job growth on record continued in August. So far in 2016, job growth has averaged a solid 182,000 jobs a month, well above the pace of about 80,000 jobs a month needed to maintain a low and stable unemployment rate, and hourly earnings for private-sector workers have increased at an annual rate of 2.8 percent, much faster than the pace of inflation. Nevertheless, more work remains to sustain faster wage growth and to ensure that the benefits of the recovery are broadly shared, including investing in infrastructure, implementing the high-standards Trans-Pacific Partnership, and raising the minimum wage.

FIVE KEY POINTS ON THE LABOR MARKET IN AUGUST 2016

U.S. businesses have now added 15.1 million jobs since private-sector job growth turned positive in early 2010.Today, we learned that private employment rose by 126,000 jobs in August, following a robust average gain of 232,000 jobs in June and July. Total nonfarm employment rose by 151,000 jobs in August, below the monthly average for 2016 so far but substantially higher than the pace of about 80,000 jobs per month that CEA estimates is necessary to maintain a low and stable unemployment rate given the impact of demographic trends on labor force participation.The unemployment rate held steady at 4.9 percent in August. The labor force participation rate remained at 62.8 percent, the same rate as in October 2013 despite downward pressure from demographic trends. So far in 2016, nominal earnings for private-sector workers have increased at an annual rate of 2.8 percent, well above the pace of inflation (1.3 percent as of July, the latest data available).
As the labor market has strengthened, the share of employees quitting their jobs has recovered to roughly its pre-recession average.The quits rate tends to fall in recessions and rise in recoveries, since workers are generally more likely to choose to leave a job if there are job opportunities available elsewhere. As such, a higher quits rate is a sign of a stronger labor market. The chart below plots data from the Job Openings and Labor Turnover Survey (JOLTS) on both quits (voluntary separations) and layoffs and discharges (involuntary separations). The quits rate plummeted in the Great Recession as the layoffs and discharges rate rose sharply. Since then, as the labor market has recovered, the layoffs and discharges rate has fallen well below its pre-recession average, and the quits rate was near its pre-recession average as of June 2016 (the most recent data available). Nevertheless, the quits rate is still below its level in the early 2000s, part of a broader, decades-long trend ofdeclining labor market fluiditywhose causes and consequences continue to be debated by economists.
Workers in nearly all private industries have seen their unemployment rates recover and fall below their pre-recession averages.The headline unemployment rate recovered to its pre-recession average of 5.3 percent in June 2015 and has since fallen even further, holding steady at 4.9 percent in August 2016. As shown in the chart below, the impact of the Great Recession varied across industries, with mining, quarrying, and oil and gas extraction workers, manufacturing workers, and construction workers in particular seeing large increases in their unemployment rates. As of August, however, unemployment rates for workers in 9 of the 11 major private industries have fallen below their respective pre-recession averages. The two exceptions are education and health services workers, whose unemployment rate has essentially recovered to its pre-recession average of 3.3 percent, and mining, quarrying, and oil and gas extraction workers, whose unemployment rate nearly recovered before increasing since mid-2014 amid falling oil prices and production (see point 4 below).
Employment in the mining and logging industry, which includes oil and gas extraction, has fallen sharply in recent months amid low oil prices.While the decline in oil priceshas benefitted consumers and the economy overall, it has weighed heavily on mining and logging employment, which has fallen by 25 percent since September 2014. Oil and gas workers make up more than half of the mining and logging industry; however, this sector represents just 0.5 percent of total U.S. nonfarm employment. The level of mining and logging employment is closely correlated with the price of oil, with shifts in employment usually following price changes, as the chart below shows. Since 2000, mining and logging employment has been most closely correlated with the price of oil eight months before, suggesting that the recent slight moderation in oil prices since the beginning of 2016 may translate into a slowdown in the pace of employment losses in the months ahead.
The distribution of job growth across industries in August was broadly consistent with the pattern over the past year, though some industries saw below-trend growth.Above-average gains relative to the past year were seen in transportation and warehousing (+15,000) and State and local government (+24,000), while mining and logging (which includes oil extraction) posted a smaller loss (-4,000) than in recent months. On the other hand, several industries, including professional and business services (+25,000, excluding temporary help services), health care and social assistance (+36,000), private educational services (+2,000), and utilities (-1,000) saw weaker-than-average growth. Slow global growth has weighed on the manufacturing sector, which is more export-oriented than other industries and which posted a loss of 14,000 jobs in August.Across the 17 industries shown below, the correlation between the most recent one-month percent change and the average percent change over the last twelve months was 0.82, in line with the average correlation over the last year.