Skip to comments.The Single Most Accurate Indicator of Labor Market Health (couldn't be clearer)
Posted on 07/08/2012 9:51:19 PM PDT by STARWISE
The release of the June labor market data marks the third anniversary of the official end of the recession that began in June 2009. Thus, this is a good moment to look at the single best indicator of U.S. labor market health. As is so often the case, it is also one of the simplest: the employment-to-population ratio.
In essence, this tells us what share of the working-age population (16-years old and above) has a job. When the ratio goes up, things are getting better. When it doesnt, the labor market is not recovering.
To know what kind of job growth we need for economic recovery, we must first realize that the United States is still a growing nation. Each month, the working-age population grows by an estimated 180,000 people. Simply to support this growing population, we need to add at least 130,000 new jobs.
With anything less, we fall further behind. No matter what the other economic data indicates, a true labor market recovery requires job growth strong enough to consistently raise the employment-to-population ratio.
This would mean adding at least 250,000 new jobs per month, every month, for years.
Damn the vicious, blockheaded, willfully stubborn and prideful monster who refuses to admit his catastrophic failures and change course NOW before we're past the point of no return! Lord, help us.
When Government is allowed to proclaim their flawed 8.2% unemployment figures as a “step in the right direction” they deceive us all by arbitrarily carving off the millions of Americans they deem no longer “participating” in fruitless employment searches via Government record keepers.
Labor market participation is the booby prize of all economies.
U.S. G.D.P. Is growing even as fewer participate. Think long and hard about that fact.
‘they deceive us all ‘
I’m not deceived.
Anyone else on here deceived by the gov’t?
Check out my blog The Obama Clarifier for more dirt on Obozo. http://obamaclarifier.blogspot.com/
U.S. G.D.P. Is growing even as fewer participate.
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July 8, 2012
“Most of my recent analysis has pertained to Europe.
However, on the other side of the pond, the US economy is showing major signs of deterioration. The jobs data, even after the BLS massages it, is awful. Secondly, 1Q12 GDP estimates have been revised lower.
Weve also seen the two consecutive bad Philly Fed surveys, including the fact that the average workweek has shortened for two months now. Were also seeing a drop in the Empire Manufacturing index.
In addition to this, weve seen the following companies cut their forecasts for 2012: Pall (PLL), Nucor (NUE), Ryder Systems (R), Proctor & Gamble (PG), Cardinal Health (CAH), Texas Instruments (TXN), Starbucks (SBUX), Autodesk (ADSK), FedEx (FDX), Jabil Circuit (JBL), Bed, Bath & Beyond (BBBY), and Adobe Systems (ADBE).
“There are 12.7 million unemployed people in the United States, according to the recently released June unemployment figures from the Bureau of Labor and Statistics.”
And I don’t think that’s counting those who’ve stopped looking after 2 yrs trying, or taken low wage part-time jobs.
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Unemployment Rate Dropped In Every State That Elected A Republican Gov. In 2010
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To see this tragedy created intentionally in the greatest nation on the face of the earth from the dictator bully’s over-regulation, punishments and the massive uncertainty and doubt his arbitrary and radical policies have forced on business people and wealth/job creators is beyond insidious, treasonous and despicable.
I want my kid to pop Obama in the nose.
I know .. what caring, savvy parent wouldn’t. It’s beyond breathtaking and infuriating to see our wonderful country driven to these depths of despair .. and intentionally.
Our kids and their kids will never know the relative sanity and peace of mind that mostly blessed our lives at their ages. What an evil, evil man.
Now, he’s going to announce he wants to extend the Bush tax cuts for a year, but only for that segment under $250K, once again insistent on punishing those risk taking small business people who create jobs and the successful, so they’ll keep sitting on the sidelines.
So that’s what a recovery is supposed to look like?
“So thats what a recovery is supposed to look like?”
The definition I’ve heard is that we are in a “recovery” when the current grow rate exceeds the long term growth rate trend line (about 3-1/2 %). We were in a recovery in late 2009 and early 2010. Since the summer of 2010, the growth rate has been about 1-1/2 % to 2-1/2 . In other words, the recovery ended about 2 years ago.
GDP is still growing, even if that growth was revised lower.
This is all well and good, but I know several families where one spouse lost a job, and have now made a conscious decision to keep the “unemployed” spouse home to raise the kids. It’s hard to estimate an accurate unemployment rate when you have this kind of dynamic going on.
Interesting that the decline seems to have started in early 2007 which would coincide with the beginning of the Reid-Pelosi congress. The graph you linked shows this more clearly than any other I’ve seen. Thanks!
If GDP grows at a rate of 1% while the working-age population grows at a rate of 2%, then you can see that this is a serious problem.
I agree that employment to population ratio is the best indicator. However, I was reading in some thread on Friday that the best of the e/p ratios is actually the one that goes from about 22 - 55 years of age. Apparently, that is considered the most “clean” view of how the economy is going because it excludes teens and semi-retired and retired workers from the mix.
In short, it shows those who MUST have a job and how they are doing getting a job.
I remember the graph was dismal.
Government spending is a component of the GDP. The fact that we are overspending at almost $1 trillion more per year than during W’s last budget serves to mask the current private sector health.
I hope Romney and other Republicans start using the actual unemployment rate instead of that 8.2% nonsense.
Good point. I’m encouraged you are not deceived, beginning to think American’s are buying this Obama crap when the polls are still so close. I should have said they are trying to deceive us all.
I deal mostly with small businesses and I am seeing many spouses “working” for the husband’s (or wives’) company for no pay because they lost their job. Better than just sitting on your butt.
...”We were in a recovery in late 2009 and early 2010.”....
Says who? The BLS, “independent economists”, the WH, others? I think the GDP data can be fudged, just like the BLS data are fudged. I believe the US economy has not come out of the recession, but in fact I believe it is deepening. The Obama Administration is being criminally aided and abetted by liberal bureaucrats, and by the criminally complicit media that are covering up for it. Don’t believe any of it!
The root cause of the 2008 recession was a government policy, that everyone should be able to own a house whether he could afford it or not. The government forced banks to lend money at artificially low interest rates to poor people who could not afford to keep up their mortgage payments (sub-prime loans). As a result, banks big and small were stuck with bad loans that could not be paid off. The market value of these loans fell to such a low level that large banks were forced to declare bankruptcy. Of course, Bush was declared the villain, as he happened to be President when the scheiss hit the fan. But the issuing of sub-prime loans had its roots in something called the Community Reinvestment Act which was passed during the Carter administration and implemented under Clinton.
The stock market started to recover in March 2009, after extensive examination by bean counters concluded that the banking system had stabilized. By that time, businesses had laid off their inexperienced and less productive and non productive departments.
Weak businesses ceased to exist. Businesses and people got out of debt and saved their cash. This process normally sets the stage for a recovery, and that’s what we got in late 2009 and early 2010. All he had to do was to keep doing nothing, and the economy would have kept going onward and upward. Obama would have been declared a genius and would have been a cinch for re-election, just the way Clinton landed on his feet in 1996 after Gingrich forced Clinton to balance the in spite of his worst instincts.
Unfortunately, Obama squandered stimulus and other taxpayer money by lavishing it on non-productive enterprises like public union pension funds and entitlements, and there went the recovery.
With Obamacare and promises of large business tax and income tax hikes in 2013 staring at them, potential investors like banks and small businessmen are still wisely sat on their cash as they well should, still waiting for a second chance at a recovery. If that ever happens, it won’t be under Obama.