The Wrongologist

What’s
Wrong Today:

The
Wrongologist understands that graphs and numbers do not always make for his most
popular columns. In the glare of the Syrian news, we neglected to talk about America’s
missing jobs. So, today there are a few graphs.

There are
still 3.1 unemployed people per job opening, says the Bureau of Labor Statistics’
(BLS) July Job Openings and Labor Turnover Survey, or JOLTS
report.

It has
been the same story for the last six months. By comparison, there were only1.8 unemployed persons
per job opening at the start of the recession in December 2007. The
official level of unemployed in July 2013 was 11.5 million people.

The
Wrongologist has written about this before, in February,
March,
April,
June
and now again, in September. 

The JOLTS
report takes a random sampling of 16,000 businesses and derives their numbers
from that. As you can see from the graph below, job openings have grown 69%
from the bottom of the recession in 2009 until 2012, but have been
stagnant since then:  

At
the height of the pre-recession economy in late 2007, we had about 4.6 million
job openings in America. We have the
same number of job openings today as we did 8 years ago in 2004, while
our population has grown by almost 22 million
since then. 

Looking
at specific sectors, retail trade job openings showed a decline of 50,000 from
June to July, a drop of 10.6%. These are jobs working at your big box marts,
clothing stores and so on. Construction dropped by 20,000 job openings, a
monthly decline of 16.7%, while the best hiring rate is for the leisure &
hospitality sectors.

So, the lowest
paying jobs of all have the best hiring rates in America.

This
is simply terrible. Despite the fact that corporate profits are at roaring
highs, it does not look like there will be a full recovery from our jobs crisis
in the next 4 years. The lack of robust demand for labor leads inevitably to
stagnant wages which suppresses economic growth indefinitely. Consumer spending
accounts for 70% of the US economy. If this component stagnates, it is
impossible for the other 30% to fill the hole. 

Faced with
a Republican Party that is by turns, nihilistic and filled with zeal for small
government and fewer taxes, any pragmatism about adding jobs will be met with
rhetoric about unleashing America’s businesses from regulation and how even
lower taxes will spur new jobs and new investment.

And as Paul
Krugman said this week:

The
Wrongologist often asks: What kind of society do we want to be?
It should be intolerable in our society that politicians won’t work
together to return our unemployed to work after 5 years and 8 months.

Had the
great jobs slaughter affected K Street and Wall Street, it would have been
solved in a great bi-partisan rush by our politicians.  

But, it’s
clear that Washington’s position is to let the American worker be damned.

And damned
we are.

The New
Normal endures.