Labor Participation Rate- Even HUFFPOST Figures It Out!

April 5, 2013

The labor participation rate fell to 66.3 percent it’s lowest level in 34 years in March. What recovery?

Recovery? HA!

Recovery? HA!

Even the Huffington Post has figured out that we have a structural unemployment problem:

With more than 3 million open and available jobs on the career website CareerBliss.com alone, why do we keep seeing the labor participation rate dropping?

The answer is that employers can’t find the right workers. Too many unemployed American workers lack the relevant skills needed to fill the millions of jobs available.” -Heidi Golledge

That sure doesn’t sound like ‘cyclical unemployment’ to me.

Here’s more from HuffPost: “If you look at the current employment numbers there is a quality job out there for just about every graduate — if only they would have been guided toward courses of study that would give them the skills most in demand. We can start to bridge the skills gap now by guiding future workers toward growing and emerging industries.”

Sounds like the definition of structural unemployment to me: Structural unemployment is a form of unemployment which occurs when the number of vacancies is equal to, or greater than, the number of the unemployed. The unemployed workers may lack the skills needed for the jobs, or they may not live in the part of the country or world where the jobs are available.

We have been talking about this issue for some time- here, here, here, here are some of our most recent ones.

For a great (but ominous) discussion of just how bad this is, read The Market Ticker’s post: “The Chart That Will Crash The Market.

It is about this Labor Participation Rate chart posted above.

We need to give people skills so that they can be hired. Our industry is hiring. Info about skills  and careers can be found here. Need training? Check out PMPA’s Comprehensive Training Database.


The REAL Unemployment Problem- Creating a Permanent Class of Government Dependents

May 15, 2012

The real unemployment problem- an increase of  17.9 million Americans no longer in the workforce since 2000; According to the U.S.Census 49% of Americans live in a home that receives direct monetary benefits from the U.S.Government.

Not the kind of “Change” I like to see.

Looking back at the recessions in the 1960’s, ’70’s, and ’80’s, we see a sharp recovery in employment. No such luck with the last recession.

I have a colleague who sends me crap fallacies like Paul Krugman’s latest unemployment “it isn’t structural” polemic. My colleague hates  government austerity, loves higher taxes, and loves deficit spending (uhh- he calls it necessary stimulus.)

Mr. Krugman sets up a straw man argument about the ratio of government employment to U.S. population remaining flat to show there is no structural problem. (Conveniently ignoring the fact that government employment growth is at it’s highest level since 1968)

Strawman argument from a Nobel prize winner. Isn’t that something?

That’s what happens- I guess- when you look at U-3 instead of U-6 Unemployment figures.

Let’s look at some less obscure points. How about the ratio of Americans not in the workforce  between 2000-2011 versus the increase in population over the same period?

Population increased over 30 million; folks not in the workforce increased to 17.9 million in the same period.

60%!

That is probably too weak a signal for an economist of Mr. Krugman’s pay grade to acknowledge.

Look at the chart above.

Here are some of the facts  behind that chart:

  1. There are 242 million working age Americans
  2. Only 142 million of them have jobs
  3. Those who aren’t working are depending on the government for their spending
  4. There seems to be no employment recovery. (That ‘jobless recovery’ thing.)

Bottom line, added to every other dependency and entitlement program, the unemployment that is “not structural’ according to Mr. Krugman actually brings the number of Americans dependent upon the federal government up to 91 million.

I think that folks would rather have a job.

Our shops have openings for skilled machinists. Our schools have programs to teach machining. Yet there are no applicants.

Dear Mr. Krugman, we do have a  ‘structural’ unemployment, problem, and it isn’t at all what you think.