Posts Tagged ‘unemployment’

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Stocks Soar Near 12,000 While Unemployment Stays Steady Near 10 Percent

01.25.11

As the Dow Jones Industrial Average nears 12,000, its highest point since June 2008, unemployment still hovers just below 10 percent.

Just showing how much of a gap there is between perceived and actual economic health.

Meanwhile states are slashing everything from police forces to HIV testing, treatment, and counseling to college funding, and many people think that we’re in the middle of a structural shift that doesn’t seem likely to end the current unemployment rate any time soon.

For those people who still own stock, this is good news: their once vanished equity slowly regaining their worth increases their overall financial independence. And for those who had capital to invest in the market when it was at or near its low, they really should be feeling good about the news.

But for those who didn’t own stock or have 401(k)s, or who used up all of their savings to stay afloat while they were looking for work, this doesn’t help them much. Now, it could be the case that the uptick in jobs is related to this rise in the stock market. Either way, it seems that this news is indicative of one industry doing well: the financial district.

Even though, apparently, those companies saw their stocks drop:

Gains were spread across the market. Financial and health care companies were the only two of the 10 company groups that make up the S&P index to fall.

Odd considering the financial district is still giving itself large bonuses (albeit some of it deferred per new rules) and the health care industry is where much of the job growth exists.

McDonald’s Corp. gained 0.5 percent to $75.38 after it said it meet analyst expectations and warned that rising food costs could affect its margins this year.

J.C. Penny Co. jumped 7 percent to $32.52 after the retailer said it would close some stores and its catalog business to reduce costs.

So, a large retailer company shutting stores – and thus, laying off most likely hundreds of people – is good news worthy of its stock going up? And while McDonald’s showing slight improvement means that those entry-level jobs may stay intact, but those aren’t the types of careers that families can live on.

A bright spot perhaps:

Materials companies rose after a report from the National Association for Business Economics showed that economists are more positive about economic growth and the job market than at any time since the start of the Great Recession in December 2007.

Though the stocks went up based on the speculation that jobs will continue to grow, not on actual job growth. Given what we know about the depths of the unemployment rate, it seems like the stock market could be getting a bit ahead of itself.

Photo courtesy of othermore (other)’s Flickr Photostream.

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Republicans and Democrats Both to Blame for Expiration of Unemployment Benefits

12.01.10

For being the party all about the “real” Americans, it strikes me as odd that they’d be more worried about tax cuts that affect the top 1% of Americans who are doing just fine financially rather than look out for the middle class nearly 10% who are unemployed and have been for up to two years.

But, that’s just what the Republicans are doing: focusing on the things that make for good soundbites.

Sen. Minority Leader Mitch McConnell:

“I think the one thing we clearly agreed on is that first, that we ought to resolve what the tax rates are going to be for the American people beginning next year.”

Clearly more important than making sure that 2 million unemployed Americans can make ends meet in the aftermath of the worst economic downturn since the Great Depression.  Remember that if the tax cuts expire, they go back to the rates that they were in the 1990s: not exactly a crushing time of economic repression.

It’s not all the Republicans’ fault, though.  The Democrats continue their ineptitude:

When asked why Democrats didn’t bring [unemployment insurance extension] up on the Senate floor, [Senator Dick] Durbin said they didn’t have the votes.

“It needs to be part of a package to attract Republican votes, and we found the last time around, I think, we had two Republican votes — that wouldn’t be enough,” he said.

Seriously?  You’re the party that is supposed to truly be for the middle class.  You have a majority in the Senate (and not just during this lame duck session; you retained control into the next Congress, too!).  And you still can’t get the votes?  No wonder your compatriots in the House lost so many seats.co

Rep. Scott Brown (R) added his two cents, which sounds like they could have come from just about anyone on the right side of the political divide:

“Make no mistake, I agree that they need help, but I look at it as: Are we going to do it from the bank account, or are we going to put it on the credit card?”

It’s all the rage these days to point at the debt and deficit as an excuse to do nothing. But, the questions we should be asking and that our representatives should be as well are these:

  1. What happens if we don’t extend UI benefits?
  2. What are the alternatives if we don’t?

These 2 million Americans aren’t just going to magically find work simply because they aren’t getting their $400 a week safety net anymore.  The jobs aren’t there — private sector jobs went up by 93,000 last month, which is great news and shows that we’re adding more and more jobs each month; but, it’s a fraction of the 2 million needed to help those currently in distress.  If they lose their benefits, they can’t pay rent, buy groceries, fill their cars with gas, buy modest gifts for their kids during the holidays, or pay their utilities.  You know: contributing to our consumer-based economy. Not only will those millions out of work feel the impact, so too will local businesses.

Again, these aren’t people who are just living off the government’s dime and coasting through life.  These are people who had jobs.  Most were making quite a bit more than what they’re getting now in unemployment checks.  This isn’t welfare; it’s a temporary extension of the unemployment benefits (for which these people paid into the system) to prop up the millions of Americans who fell on hard times during the Great Recession — many through no fault of their own.  These people aren’t lazy or lacking incentive to find jobs — trust me: I’ve known people in this situation and they were depressed that they hadn’t yet found work after so long.

When America shed 8 million jobs and has only regained 3 million — do the math.  To leave this people hanging out to dry would be a travesty both morally and financially.

Which brings me to my second question: if we don’t do this, then what’s the alternative?

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So, Government Can Create Jobs?

11.03.10
Official seal of the United States Department ...
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According to Farheed Zakaria, the government can create jobs.

Not by directly setting up businesses or hiring people to work for the government, necessarily; rather, through investment in new technology.

CNN: Should they be government investments?

Zakaria: That’s what’s produced the semiconductor industry, it was government investment. That’s what created the internet. Al Gore may not have created the internet, but DARPA certainly did. That’s the Defense Department venture capital group. And GPS, the technology that’s now fueling the next internet revolution, the mobile revolution, that was also a U.S. Defense Department project. Those are now producing hundreds of billions of dollars for the private sector, all started by government funding.

Not all governmental spending is bad.  To make a blanket statement like that prevents you from adjusting to unique scenarios.  Life, and the global economy, don’t always adhere to one particular ideology.

And people inherently get this.  For all those screaming that they want government to stop spending, a strong percentage want them to do just that:

On spending priorities, 40 percent favored deficit-reduction, 35 percent “spending to create jobs,” and 19 percent cutting taxes.

Will be interesting to see what happens now with the divided Congress.  I, for one, am very curious.  I just hope that the American electorate won’t tolerate pure oppositionism as the sole GOP political theory for the next two years.  Americans deserve better than that.

I think the major issue is that people are out of work.  Decrease the unemployment rate, and the worries about the national spending will go down.  Not that we can ignore a $12+ billion dollar deficit; quite the opposite.  But, something needs to be done in the short term to get our consumer-based economy moving again.  Plus, we can reform the entitlements while at the same time investing in job growth.  We could, in theory, cut spending and also spend at the same time.

Because, like I said: not all spending is bad.

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Laid Off Police Officers: Economic Downturn Causing Increase in Violent Crime?

07.29.10

Five laid off police officers in Bay City, Michigan retaliated by renting billboard space with images that suggest that the lack of cops on the streets could lead to more violent crimes, all in an effort to get back their jobs.

The cops haven’t won much support for their inflammatory billboards, nor have they gotten their jobs back, even being labeled “domestic terrorists” by some.

The police say they paid for the two billboards that went up last week to bring attention to the impasse in negotiations between its union and city officials, who are seeking a 10.8 percent reduction in labor costs from eight unions to tackle a $1.66 million budget deficit for the fiscal year that began July 1. The billboards also spotlight the city’s decision to replace the roof on city hall for $1.6 million.

The police would have you believe that the city put its citizens’ safety at risk in order to put a new roof on city hall.  But just how much less safe are Bay Citians with less than 60 cops on the beat to serve and protect a population of roughly 35,000?

This article doesn’t say just how many officers under 60 the city currently has, so it’s tough to run these numbers perfectly so let’s find a range. If there were 60 cops employed, that would average out to 1.7 officers per 1,000 residents.  If there were 55 cops employed, that would be about 1.57 officers per 1,000 residents.  So, rough estimate: 1.6 cops per 1,000 residents.

After a little investigation — because how are we to know the value of that number without any other information? — I found the average number of police officers for Midwestern cities with populations between 25,000 and 49,000 people (in 2008) was 1.7. Given that we’re dealing with averages and estimates here, that’s pretty much right at the average for the region.

Seattle, a city 17 times the size of Bay City, has also recently had people taking to visible venues — this time the op-ed page of The Seattle Times to voice their concerns about laid off police officers, which has brought up the question: how many cops is enough?

UCLA professor of public policy Mark Kleiman … says there’s no generally accepted benchmark for police staffing levels. But he says a decent police-to-population ratio is 1.5 to 2 officers per 1,000 residents.

Looks like Bay City falls safely into that acceptable range.

Given the state of Bay City’s economy — part of Michigan, which has suffered one of the nation’s highest unemployment rates for the duration of this recession — it should come as no surprise that the city has had to make some tough budgetary decisions.

And while I feel for the laid off police officers for having to join the ranks of the unemployed, it seems foolish to have squandered what money they may have had saved up on an inflammatory billboard that will most likely do nothing to change the reality that, until the economy rebounds, there just literally isn’t enough money left to employ them.

Photo courtesy of Christopher P. Bills’ Flickr Photostream

(H/T Brad Grabowski for the link)

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Unemployed for Over a Year: A Light at the End of the Tunnel?

07.06.10

My mom has been unemployed for over a year.

In that span, she has applied to hundreds of jobs — some she’s possibly qualified for; most others that she was beyond qualified for even a decade ago.  From those countless applications and resumes sent out to all those different hiring managers, she has only had six interviews.  And of those six, only three weren’t total jokes — what 50-something can afford to live on 12 bucks an hour?

She’s run the gamut of emotions.  Originally, she felt shame.  She avoided the topic when it came up in conversation with friends, offered up other excuses, anything she could to dull the humiliation of having to say that she didn’t have a job, that she couldn’t find a job, that she couldn’t even get an interview.  She felt unemployable.

Then the realization hit that she wasn’t the only one.  Many others were in the same boat as her.  While that helped ease the shame, it didn’t help the feelings anger or frustration, or helplessness.  The worst coming last winter when she was contacted by a recruiter for a coveted position in metro Detroit that promised a high salary, benefits, and other perks.

The preparation was intense.  It started off with regional phone calls and hours of studying for interviews, which she aced.  And then it was on to the big round, down in Detroit, where dozens of others were all going to try to win the precious few regional positions they had available in the state.  She spent hours studying material, doing mock interviews to prepare for anything that the hiring manager would throw at her.  She knew exact dates and times for all of her major accomplishments as well as her struggles and what she had done to overcome them throughout the past ten years of her job, and she was ready with specific work-related events and projects that she had done that would answer any and all of the possible questions they could throw at her.

By the time she drove the two hours down a few weeks later, she was ready.

And then came the interview.  She got stuck with one of the last interviews of the day, which didn’t bode well — after eight hours of interviewing, even the most seasoned interviewer would be tired and drained.  But she wasn’t deterred.  She sat down in front of the unsmiling man, ready for anything.  She had done her part, and expected him to do his.

“Okay, how about you walk me through your resume, starting with high school,” he said.

That just wasn’t what she had had in mind.  For all of her preparation, all her hard work, the manager simply wanted her to walk him through her resume, which he had no doubt had in his possession for weeks prior.  She abided, hoping that it would give way to some juicy interaction, but nothing ever did.  That was it.  They brought her in to just read through her resume, a well-prepared guide to be sure, but only meant as the Cliff’s Notes of her professional career to entice someone to bring you in for an interview to get to know the human being behind the collection of jobs on a piece of thick paper.

It was over before it even began.  They had no intention of ever hiring her, yet put her through the ringer as if she had a chance.  And it was months before she got another interview anywhere.

After that came the feeling of acceptance.  It wasn’t a lack of skills or experience.  It was just the state of everything right now.  Being in Michigan with its highest unemployment rate in the nation sure didn’t help things.  Neither did being over 50 years old battling with all of the recent graduates just entering the job market and asking for much lower wages than she.  Deciding that she might as well enjoy the time off – all the while continuing to search and send out resume after resume after resume – she picked up yoga, read more books for pleasure (which she rarely had had time for in the recent past), and finally found some relief for her excruciating and debilitating migraines that only got worse from the stress — being unemployed allowed her to check into an in-patient headache facility where they were able to get her pain under control and much more manageable, making her even more primed for getting back into the workforce.

Perhaps all of this contributed to the events of this week.  After having barely more interviews in one year than fingers on your hand, she’s now had nearly as many scheduled in the month of July.  She’s excited – for one in particular – but she’s trying to keep her expectations tempered.  It’s an optimistic trend, though, no matter how you look at it.  To go 12 months with nary an acknowledgment of applying for a job to actually getting called in for a face-to-face is quite the step in the right direction.

I’m feeling optimistic for her: based on what she’s told me, these job opportunities have legs.  They’re not piddly $25,000 a year jobs that don’t even bother utilizing her strengths and expertise.  They’re well-paying, solid positions for companies with room to grow.  After over a year of looking and hoping, and now with the unemployment extension being blocked in Congress, this turn of events couldn’t have come a moment too soon.

And I hope that this also bodes well for the American economy in general.  Too much of the news I hear and read is about deficits, balancing the budget, unemployment benefits, the way the stock market reacts to the European markets.  While all of those are important, they divert us to the big picture, the intangible, the ethereal.  Most of us can’t comprehend what owing trillions of dollars really means for anyone, let alone the federal government.  When money is simply a promissory note with a stamp of approval from the federal government declaring that this piece of paper is, in fact, money, how do the rules even apply to the entity that itself decides what is and is not money?

We’ve been going into debt for ten years, paying for these two wars on credit, and now it’s a huge problem that needs fixing immediately, without regard for those who are currently unemployed, scraping by, trying to make ends meet.  Now it’s vital to fix at this very instant.  Now it’s a matter of our grandchildren dealing with… what we’re dealing with now?  I don’t even know.  And whose grandchildren?  Mine?  I’m 28.  I don’t even have kids yet, but assuming that I did, I won’t have grandchildren who will even know how to pronounce the words “budget” or “economy” for another 30-plus years, at least.  Who knows what will be going on then?  Who knows what wars we will or won’t be fighting?  Who knows what the Euro will be doing or how strong the Zone will be at that point?

The news talks about falling unemployment rates, but says that’s actually a bad thing because that means that people are just giving up.  It’s not that they’ve actually found work, they’re just no longer collecting benefits from the state anymore; they’ve lost hope that they’ll find a job anytime soon.  They’ve stopped looking for work because there’s no work to be found.

Others who have jobs aren’t in much better positions: they’re finding that the only way they can keep their jobs is to take a 40 percent drop in salary and loss of all benefits just to stay employed.  But that’s not really working, is it?  You can’t buy a house on $12 an hour, not even here in Michigan.  You can’t build a savings.  You can’t invest.  You can’t pay for your children’s or grandchildren’s college tuition.

Some industries will never recover from this recession.  And what that really means is that the skills and training that many people have spent their whole lives honing may never again be profitable or marketable.  And that’s the real casualty of this entire mess, for which there’s no real remedy.

But, while the news is understandably bleak, there are pockets of hope if you skip over the broad strokes that make the airwaves and delve into the lives of those who are experiencing it right now.  I hope my mom gets one of these jobs.  I know she’ll flourish and succeed out of the gate.  She’s resilient and courageous.  And when she does finally join the workforce again, I hope that means that many others are also joining the ranks of the employed.  I hope it’s a sign.

Things have to get better eventually.  Might as well be now.

Photo by Ryan Mason.  Midland, MI, 2010.

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Scott Brown Makes Actual Bipartisan Move

02.23.10
WASHINGTON - JANUARY 21:  U.S. Senator-elect S...

Less than a month after becoming the first Republican senator elected in Massachusetts in decades – prompting excessive celebration by the conservatives to the point where it was even declared (as a joke, but still capturing the essence of the Republican’s glee) that the GOP had won a 41-to-59 seat majority in the Senate – Sen. Scott Brown’s first major legislative act was voting with the Democrats.

Ouch.

That’s gotta take some wind out of the sails of the Republicans who were going so far as to flaunt Brown as a potential GOP presidential candidate and, at the very least, hoisting him up as the signal to  Democrats in power that public support had switched sides.

I’m not sure that this Jobs Bill will do very much.  It doesn’t extend unemployment benefits to the millions who are running out of benefits at the end of next month.  And there are a number of loopholes that will allow businesses to reap the tax benefits without actually creating new jobs (i.e. firing someone and then rehiring them right back).  The current bill was even chopped down to its current size by Senate Majority Leader Harry Reid for reasons still debated to many Democrats’ frustration.  Perhaps, though, it was that move that garnered Brown’s bipartisan support.

I must say that I’m surprised and impressed by Brown’s vote.  It would’ve been very easy for the freshman senator to just vote in lockstep with the almost everyone else in his party, especially being the new guy on the block, so kudos to Sen. Brown for making up his own mind and not simply following the crowd.  Let’s just hope he doesn’t end up pulling a Snowe and vote against it when it comes to the final, reconciled bill with the House.

Image by Getty Images via Daylife
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Elect Scott Brown, Magician

01.19.10

To find out what issues on which the people of Massachusetts elected Scott Brown (R), I turned to the senator-elect’s own website, hoping that it could shed some light on just how he’s going to run Washington better since he’s a Republican and here to solve some challenges that the Democrats are incapable of doing.  Let’s take a run through these issues and how he’s planning to solve them.

First off, his main reason for running, we learn, is to help get our economy moving again.  His strategy: “I want to ensure that we leave them [our children and grandchildren] an America that is financially stronger and independent: minus a national debt that we can never repay.”  A noble idea, for sure, to want a better life for the next generation but hardly a solid plan to turn around the economy in the very near future, which is exactly what the American people want and probably a big reason why voters in Massachusetts elected Brown: Dems are in control and unemployment is still over 10%.

Health care: He believes that all Americans deserve health care, but he’s not going to do anything to help all Americans receive health care.  He states that he will oppose the current health care bill that is stalled in Congress because it “raises taxes,” but that he supports policies that “will drive down costs and make it easier for people to purchase affordable insurance.”  Perhaps Brown could let us know what those policies are that will drive down costs – it’s a nice campaign promise but, based on every other GOP senator and congressperson, there are no policies out there that he speaks of.  Nevermind the fact that he now governs in a state that provides health care to its citizens – courtesy of former governor Mitt Romney – yet refuses to provide anything remotely equal to the rest of America.

Economy: Brown says it all pretty clearly right here: “I am a free enterprise advocate who believes that lower taxes can encourage economic growth. Raising taxes stifles growth, weakens the economy and puts more people out of work.”  Well, Obama’s stimulus plan included a gigantic tax cut – bigger than Bush’s in the first two years of the bill – but the economy hasn’t exactly turned around.  Perhaps he’s of the belief that tax cuts only work when the GOP does them. I guess that just means that Obama didn’t cut enough taxes then, but then why was the GOP screaming that the stimulus plan was far too huge?  Maybe Brown has it all figured out, but it sure seems like all he’s got for us is smoke and mirrors. Let’s keep looking at what he has in store for us.

Energy and Environment: “I support reasonable and appropriate development of alternative energy sources such as wind, solar, nuclear, geothermal and improved hydroelectric facilities. I oppose a national cap-and-trade program because of the higher costs that families and businesses would incur.”  No clue what “reasonable and appropriate” means.  Perhaps cap-and-trade isn’t the best option, but what is an alternative?  Let’s push a better idea if cap-and-trade is awful.  The alternative cannot be just doing nothing.  Although, it sure looks like that’s what Brown advocates, along with the rest of the GOP on just about every big issue.

Immigration: Well, Brown sure doesn’t win back any of those Hispanic votes that went to Obama in the last presidential election with his unique ideas in this category: “I oppose amnesty, and I believe we ought to strengthen our border enforcement and institute an employment verification system with penalties for companies that hire illegal immigrants.”  Opposing amnesty is a camouflaged way of saying, “I think we should send them all back to Mexico.”  Of course, he doesn’t mention just how unbelievably expensive – culturally, politically, and fiscally – that endeavor would cost.  And “strengthen our border enforcement” means exactly what it sounds like: let’s build a huge wall!  Pathetic and monumentally stupid.  Not to mention extremely expensive.  Not exactly helping the debt any for our grandchildren, Brown.

Marriage: Nothing new here, just the same old discrimination disguised as age-old definition: he believes that marriage is between a man and a woman only.  Of course, his state does provide marriage equality so yet again Brown governs in a state whose laws run contrary to his own beliefs and stances on policy issues.

There are plenty more issues that Brown tackles on his site and if you want a boilerplate for where the GOP currently stands, look no further.  He’s all for guns and the death penalty and against gay marriage.  Shocking.  He does actually say that he believes in a woman’s choice, but favors strong regulation and opposes partial birth abortion – a moderate tone in an otherwise pretty straightforward GOP game plan.  He’s definitely not the worst person to elect into office; he’s just what you’d expect from a GOP candidate right now, which means that the Republican Party really offers only illusion and misdirection and providing alternatives with real-world values no more than those of magic potions.

Scott Brown, Magician: the 41st Republican vote in the Senate.