http://www.usnews.com/opinion/mzuckerman/articles/2011/06/20/why-the-jobs-situation-is-worse-than-it-looks?PageNr=3Why the Jobs Situation Is Worse Than It Looks
We now have more idle men and women than at any time since the Great Depression
By Mortimer B. Zuckerman
June 20, 2011
The Great Recession has now earned the dubious right of being compared to the Great Depression. In the face of the most stimulative fiscal and monetary policies in our history, we have experienced the loss of over 7 million jobs,
wiping out every job gained since the year 2000. From the moment the Obama administration came into office, there have been no net increases in full-time jobs, only in part-time jobs. This is contrary to all previous recessions. Employers are not recalling the workers they laid off from full-time employment.
....
Don't pay too much attention to the headline unemployment rate of 9.1 percent. It is scary enough, but it is a gloss on the reality. These numbers do not include the millions who have stopped looking for a job or who are working part time but would work full time if a position were available. And they count only those people who have actively applied for a job within the last four weeks....
Include those others and the real number is a nasty 16 percent. ...And this 16 percent does not take into account the discouraged workers who have left the labor force....
Labor's share of national income has fallen to the lowest level in modern history, down to 57.5 percent in the first quarter as compared to 59.8 percent when the so-called recovery began. This reflects not only the 7 million fewer workers but the fact that wages for part-time workers now average $19,000—less than half the median income.Just to illustrate how insecure the labor movement is, there is nobody on strike in the United States today, according to David Rosenberg of wealth management firm Gluskin Sheff. Back in the 1970s, it was common in any given month to see as many as 30,000 workers on the picket line, and there were typically 300 work stoppages at any given time.
....
But hang on.
Even to come up with the(reported)54,000 new jobs, the Bureau of Labor Statistics assumed that 206,000 jobs were created by newly formed companies that its analysts believe—but can't prove—were, in effect, born in May under the so-called birth/death model, which relies primarily on historical extrapolations.
Without this generous assumption in the face of a slowing economy, the United States would have lost jobs in May. Last year the bureau assumed that 192,000 jobs were created through new start-ups in the comparable month, but on review most of them eventually had to be taken out, as start-ups have been distressingly weak given the lack of financing from their traditional sources such as bank loans, home equity loans, and credit card lines.Where are we today? We have seemingly added jobs,
but it is not because hiring has increased. In February 2009 there were 4.7 million separations—that is, jobs lost—but by March 2011 this had fallen to 3.8 million. In other words, the pace of layoffs has diminished, but that is not the same thing as more hiring.
The employment numbers look better than they really are because of the aggressive layoffs in the early part of this recession and the reluctance of American business to rehire workers. In fact, the apparent improvement in job numbers has been made up of one part extra hiring and two parts reduced firing.....
Clearly, the Great American Job Machine is breaking down, and roadside assistance is not on the horizon...
(much more at link)
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