The US Job Market is Booming, For Those Who Can Admit It
Furturist blog
The US economy continues to glide along in an optimal 'goldilocks' trajectory. GDP growth, consumer confidence, service sector growth, and unemployment levels continue to proceed at robust, but not overheated levels.
The June unemployment report confirmed this. A quick glance at the historical unemployment rate from the Bureau of Labor Statistics shows that the current rate of 4.6% is lower than it has been for 32 of the last 35 years, the only period of lower unemployment being the bubble era of 1998-2000.
This also shows something else that is interesting. Let's examine the average unemployment rates over the last 14 years, during which there were two Presidents. For simplicity, we shall ignore the notion of inheriting an economy, whether good or bad, from one's predecessor.
Clinton : 5.3%
George W. Bush : 5.3%
So Clinton and GWB have had the same average unemployment rates during their terms, and only 3 of Clinton's 8 years had a lower rate than the 4.6% it is today. Imagine that.
People who suffer from Bush Derangement Syndrome just cannot accept that the economy could possibly be doing well. Their memorized arguments are :
1) They will say that those who have been unemployed for a long time are no longer collecting benefits and do not get reported in the statistics. This is untrue, as consumer confidence continues to be high.
2) They will say is that these jobs are all lower-skilled jobs that pay poorly. This directly contradicts their claims that all the gains of US economic growth gravitate to the top of the income latter while the rest received no benefit.
3) Their final argument will be that 150,000 jobs a month are needed to keep up with labor force growth. This is untrue, as the US workforce is 140 million people, growing at 1% a year, or 1.4 million new entrants a year. Divide this by 12, and it comes to 116,600 jobs needed per month to accommodate the new entrants. Furthermore, the US now has 1 million people who earn a living through entrepreneurial Internet activity, such as eBay trading, blogging, Google Ads, domain investing, etc. Ten years ago, these people would otherwise be working at traditional employers, but have voluntarily left the workforce. Soon, video game item trading will also become a viable form of self-employment (see item 6 here).
Behind this lies a deeper observation. The angry Left has so much cognitive dissonance about the fact that the economy is currently strong, that they are probably inhibiting their own chances of success in this economy. Their pessimism leads to risk aversion, negativity, and other behaviors that preclude success. It also leads to a tortured logic that Bush supporters can be incredibly 'dumb' yet unfairly 'rich' at the same time.
Here is an example of an extremist anti-Bush blogger, someone at least two standard deviations from the middle of political ideology, desperately trying to believe that the economy is doing poorly.
It is true that jobs continue to be lost at the bottom of the skill ladder (like in manufacturing), while a greater number of jobs are added at the top of the skill ladder. This is a boon for highly-educated workers, but a problem for workers with lower-level skills. Those who can upgrade their skills will prosper, and those that cannot will see declines in their standards of living.
This pattern of workforce evolution has been the norm for centuries, ever since Ned Ludd and his 'Luddite' followers destroyed cotton looms that put handweavers out of business. The accelerating rate of economic growth, however, now means that while a person could once spend their whole life at one skill level, they now have to continuously upgrade their skills every decade or so. |
