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In Case You Missed It This Morning… Obama’s Economy SUCKS!

Posted by Bruce Carroll at 5:08 pm - July 6, 2012.
Filed under: Depression 2.0,Economy,Obama Incompetence

Well, it appears the minimal job growth in June was even worse than officially reported:

CNBC drilled down into the June jobs numbers from the Bureau of Labor Statistics. Here is the shocking truth about the figure of 80,000 jobs supposedly created.

The birth-death model, which approximates the amount of jobs gained through new businesses created too recently to be counted in the formal survey, added 124,000 positions, meaning that without the estimation the total count would have been a loss of 44,000.

Watch for the July jobs report period in a few weeks. That’s when we’re likely to see that June’s numbers get revised down, as has been the trend during the Obama era. June may get revised into negative job growth.

Jim Pethokoukis says we may not see jobs recover to a satisfactory level until the year 2030!

The “jobs gap” is the number of jobs the U.S. economy needs to create in order to return to pre-recession employment levels while also absorbing the people who enter the labor force each month.

The Hamilton Project has created a calculator (h/t to Matt O’Brien) that allows you to plug in various job creation rates to see how long it would take to fill the jobs gap under various scenarios.

What if the economy kept creating jobs at the 150,000-a-month pace that we saw last year and so far this year?

So under that scenario, the jobs gap would not close until after 2025, maybe more like 2030 — assuming the economy isn’t hit with another recession or two or three during that span.

Crikey.

At this point in the Reagan Recovery, we were hitting between 5 to 7% GDP quarterly growth and over 4 million jobs were created in just the 12 months before the November 1984 election.  Maybe the lesson here is…. one economic plan worked, the other is a complete mess.

-Bruce (GayPatriot)

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16 Comments

  1. African Americans, especially youth, Latinos and Women are the ones who have been most affected by the disappearing jobs. Yet, this same group will follow the Pied Piper and vote for another term of hope and change. Will they ever learn?

    Comment by Roberto — July 6, 2012 @ 5:49 pm - July 6, 2012

  2. 80,000 Americans got jobs last month, one-third of which were temp jobs. 85,000 Americans went on disability last month. This is Obama’s idea of “doing fine.”

    Comment by V the K — July 6, 2012 @ 5:50 pm - July 6, 2012

  3. [...] In Case You Missed It This Morning… Obama’s Economy SUCKS! [...]

    Pingback by GayPatriot » The robust Reagan recovery contrasted to the anemic Obama one — July 6, 2012 @ 6:14 pm - July 6, 2012

  4. Sadly, no, Roberto, they won’t. Black people have grown more dependent on the government for jobs, welfare, and overall well-being under the “Long-Legged Mack Daddy” than any other President since LBJ. The devotion to the letter “D” and the first biracial President (he’s only “Black” if you go by the slaveowners’ old “one-drop rule”) has made them completely oblivious to the world coming undone around them. Yet when I say that, I’m an Uncle Tom or Uncle Ruckus.

    Comment by Douglas — July 6, 2012 @ 6:21 pm - July 6, 2012

  5. Many of them realize Obama sucks. But to them, rightly or wrongly, Romney and the Republicans are worse.

    Comment by sonicfrog — July 6, 2012 @ 7:50 pm - July 6, 2012

  6. Of course, we’re still admitting 100,000 foreigners a month and planning to hand out a million work permits to illegals.

    The problem here is fundamental: we don’t need as many workers as we used to. I read a few weeks back that Foxconn was planning to automate more work in China (a hundred thousand benchtop robots) so, soon enough, China will have too many workers.

    A Nobel prize to someone who figures out how to have some decent standard of living with fewer people working.

    Comment by SoCalRobert — July 6, 2012 @ 7:56 pm - July 6, 2012

  7. SCR, sounds like a bit of Luddism there.

    A Nobel prize to someone who figures out how to have some decent standard of living if we hold back factory technology. “Standard of living” means what goods are produced. The entire forward progress of the last 230 years is a story of jobs being destroyed as technology progresses. It’s a good thing. A very, very, very good thing.

    The problem is the lack of replacement jobs… and the problem, there, is government getting in the way of job creation, by ten thousand different means.

    Comment by ILoveCapitalism — July 7, 2012 @ 9:28 am - July 7, 2012

  8. ILC – no Luddite am I but weve been eliminating jobs far faster than we’ve been creating them for generations.

    Yes, we’ve had new industries needing new workers but many of those industries have the express purpose of replacing labor. Robotics is a good example: a small number of high skill workers create devices intended to replace a lot of low skill workers. That’s OK as long as there is other work for the low skill workers. That seems to be the problem. Businesses aren’t in the business of creating jobs regardless of regulation or lack thereof.

    Productivity growth, like most things, reaches a point of diminishing returns. The ultimate in productivity is output with no input. That leave input with nothing.

    Banking is another good example. Not that long ago, a call to the bank was answered by a person who helped you. Those people have been replaced by a computer. Debit cards and online bill payment has caused check volume to collapse. The number of people handling paper checks has followed. All well and good (I use bill pay and debit cards exclusively) but where are the replacement jobs?

    In no way would I suggest that Obama has any clue of what to do (I think he leans towards making things worse to enable more expansion of governmet) but my point is that the problems are deeper than politics. When worked moved from the farm to the factories, there were upsets to society but we adjusted. What to do now? The problems now, in the west, not just in the USA, are the consequences of this shift. The credit bubble was created as a way to spur consumption to maintain the illusion of prosperity. It popped.

    Comment by SoCalRobert — July 7, 2012 @ 10:40 am - July 7, 2012

  9. SoCalRobert… that is indeed a challenge. Part of the problem is our education system, which is built on a nineteenth-century model and is designed to turn people into either laborers or bureaucrats. It does not equip people to become skilled tradesmen or other skilled workers that are still in high demand. Yes, there will be a lot more robots in factories, and performing clerical tasks; but at least for a while, there will be a need for people to develop and maintain those systems, build the work environments for the machines, and maintain the physical and cybernetic infrastructure. Our current model for public education develops none of those skills. And the answer of the progressive left…. to simply hire more government bureaucrats to pick up the slack… is a disastrous proposition on all fronts.

    Comment by V the K — July 7, 2012 @ 12:38 pm - July 7, 2012

  10. VtK – I agree somewhat with your position on the education system – woefully expensive and misguided. I went to public grade school in the 60s (yes, I’m up there) and have done reasonably well. But I was blessed with high-IQ parents (a physician and a registered nurse) and had some amount of encouragement to educate myself.

    But let’s face it, the bell curve is a reality that no amount of education reform will change. We all run into dim people every day. Some folks are dim because that’s the hand nature dealt them; others are dim because of decisions they made or, lets face it, bad luck. These people will never be able to work in jobs requiring lots of skills. That’s one of the basic faults in education: the idea that all students are equally educable and are all college material.

    Right now, the government (at all levels) serves as an employment program for people who are otherwise unemployable (and at great cost). (That’s not to say that government workers are all dumb… that’s to say that some, like employees of some metro transit systems, aren’t very good employees.)

    Even “has to be done here” work needs less skill. I looked at some new houses a couple of years ago and the plumbing was some sort of plastic tubing with crimp-on connectors. No copper, no soldering, no bends – just flex tubing (and these weren’t cheap houses). It looked easy enough to install that even I could do it. No need for a skilled plumber.

    I have no clue as to the solution. I simply fear that the belief that politics and can fix the mess is wrong. If we expect a GOP government to magically fix the problem then we’ll all be disappointed. There’s no telling where our politics will go when the next round of tax cuts or whatever is supposed to stimulate job growth fails utterly.

    Comment by SoCalRobert — July 7, 2012 @ 2:12 pm - July 7, 2012

  11. weve been eliminating jobs far faster than we’ve been creating them for generations

    Hyperbole. If it were true, unemployment could not have been at 4% just a few short years ago. And yet… there it was… concurrently with the highest Labor Force Participation rates ever, and booms in China and India.

    many of those industries have the express purpose of replacing labor. Robotics is a good example:

    Again, that’s a good thing: using capital (as in, capitalism) to augment or replace human labor, in other words, to raise living standards. >90% of the population used to be in dawn-to-dusk, 365-day farming. Then technology and capital got better, and they moved to sweatshops – an improvement, at the time. Then, as technology and capital got better still, it was economically possible (and desirable) to move them to factories with better conditions. Then to service industries. Etc.

    Being able to produce more and more goods with less and less human labor, is the story of human progress. Not in a million years would I want it any other way.

    That’s OK as long as there is other work for the low skill workers

    There would be, if government were not in the way. Under free markets (which we certainly do NOT have), unemployment is minimal to nonexistent, because all you have to do to create a job is negotiate between two parties: the employer and the employee. What they choose to do with each other as consenting adults, is their business. Jobs are created freely. As skilled and semi-skilled labor moves into higher paying jobs, the demand for human beings who will do the unskilled labor – janitors, elevator operators, farm workers, etc. – goes UP. History shows that, as capitalism progresses, the real wages earned by unskilled labor – that is, the jobs available to unskilled labor and the living standards they afford – goes UP.

    That is why a janitor today lives far better than a king did, 200 years ago. Unless, of course, government is there to prevent job creation with the endless burdens, regulations, taxes and mandates that government puts on employers. That’s the problem.

    Not that long ago, a call to the bank was answered by a person who helped you. Those people have been replaced by a computer.

    You seriously think that society *should* employ thousands, if not millions, of people in jobs that were always fairly boring and empty to begin with, and now all the more empty because technology has in fact made them unnecessary? Again, that smacks of Luddism – no getting around it.

    where are the replacement jobs?

    See a couple paragraphs above. Get government out of the way, and the replacement jobs will come. We don’t have to know in advance, exactly where or how. That’s the beauty of the free market: it invents jobs that nobody could imagine. WHEN, that is, it is allowed to work.

    Comment by ILoveCapitalism — July 7, 2012 @ 2:35 pm - July 7, 2012

  12. (continued) We don’t have free labor markets today – and we didn’t in the 1930s, either. If I had more time, I could give you the names of some books on how the government actively prevented job creation in the 1930s, and so caused the Great Depression.

    Comment by ILoveCapitalism — July 7, 2012 @ 2:43 pm - July 7, 2012

  13. Uncle Ruckus

    HA! Sorry, but that’s a funny character.

    Comment by TGC — July 7, 2012 @ 3:38 pm - July 7, 2012

  14. In a growing economy, you have to “produce” things to create wealth. You produce goods or services: things people buy. We switched to being primarily a service economy some years ago and outsources our production of goods to places with cheaper labor, less regulation and fewer government intrusions.

    Last year, GE shut down its incandescent light bulb factory in Front Royal, Virginia. That factory could not be converted to manufacturing twisty bulbs because the environment hazards associated with the mercury involved is too great a risk to undertake in the USA. So, GE makes those twisty bulbs where life is cheap and the government is on the side of more jobs and not too concerned with long term health problems for the workers. Heck, the air in China is little more than an open sewer. And, naturally, China was given a total pass in the Kyoto Protocols.

    Now the Department of Agriculture is banning farm family kids from operating tractors. We are so hell-bent on eliminating any form of risk that it is profitable to pursue unemployment and disability as a steady guaranteed income.

    If we are to return to actually producing goods in this country, we will first have to allow people to take physical risks in mining, farming, construction, assembly, etc. Robots don’t call in sick or have unions or demand paternity leave.

    Employers are forced to keep the work hours low enough to avoid the costs of having a full time employee. This, in turn, forces many workers to take two jobs and work longer and harder because of the penalties associated with full time employment.

    We could return a lot of manufacturing to this country if we were not oppressed by the government and the Unions. Many of the BMW’s that are sold in Germany are manufactured in non-union shops in the US and shipped there.

    If the US auto industry were permitted to unleash the genius of the diesel engine (as has been the case in Europe) our oil consumption rates would change dramatically for the better. We could actually reach standards of 30mpg/city and 50mpg/highway fairly quickly. Even the Maybach crowd could love a high-tech diesel turbo-charged diesel speed machine engine.

    But, we have this elite oligarchy that know better about lightbulbs and auto and truck fuel standards and educating the public better and on and on and on.

    What one government program does an efficient, economical job at doing anything? An auto repair shop can repair a badly damaged transmission in less time than you can buy license tags for a new car at the DMV.

    Comment by heliotrope — July 7, 2012 @ 4:16 pm - July 7, 2012

  15. Yes, Uncle Ruckus is. Did you see where he took the DNA test?

    Comment by Douglas — July 8, 2012 @ 3:42 pm - July 8, 2012

  16. ILC – I hope you’re right. The issue I have with your POV is the assumption that all workers are equally suitable for “high value” jobs. While you wouldn’t be interested in a boring and repetitive job (e.g. telephone operator), the fact remains that there are lots of people for whom that type of work is the only suitable work. The bell curve, again.

    To leave all employment up to individual negotiation means a lot of people will be taken advantage of – a race to the bottom.

    You seem to think that I believe all progress to be bad. Of course not… I make a decent living from technology.

    The point I keep trying to make is that progress comes with side effects – not all good and certainly not all anticipated. The trick is to recognize the side effects and deal with them as best we can.

    To simply ignore the displacements caused by automation and off-shoring and assume that Suzy Bluejeans can move from working at the textile mill to a career as an engineer is, shall we say, a bit too optimistic. China and India may have boomed (although that’s coming to an end), I certainly wouldn’t want to live there.

    The fact remains that if all regulation were abolished tomorrow, lots of jobs are not coming back. In the case of curly-Q light bulbs, we as a people would not tolerate the environmental fallout since business cannot be relied on to self-regulate (meaning it’s left to government which, as we all know, goes beyond necessary and prudent).

    Also, the lower unemployment rates of recent times were, IMHO, a mirage – the result of loose credit and over-consumption. As Mark Styen has pointed out, this nation has more single-family homes than it will need for a generation… not too mention all the junk purchased by people cashing out the so-called equity in their over-valued homes.

    Comment by SoCalRobert — July 8, 2012 @ 5:11 pm - July 8, 2012

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