Right Wing Granny

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Right Wing Granny

Tag Archives: unemployment

Political Or Good Policy?

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At a time when Americans are still dealing with inflation, the Federal Reserve has cut interest rates by half a percentage point.

On Wednesday, Breitbart noted:

The Federal Reserve moved to cut interest rates by a half percentage point—the first reduction since the central bank cut rates to near zero when the pandemic struck in 2020—in a vote of confidence that inflation will continue to moderate and an attempt to fend off a further increase in unemployment.

“Recent indicators suggest that economic activity has continued to expand at a solid pace. Job gains have slowed, and the unemployment rate has moved up but remains low. Inflation has made further progress toward the Committee’s 2 percent objective but remains somewhat elevated,” the Fed said in a statement.

…Fed officials have also said that they now view the risks to their mandate to maintain full employment to be greater than the risks of a resurgence of inflation. Earlier this summer, the unemployment rate tripped the Sahm Rule threshold by rising more than a half a percentage point above its recent low, typically a signal that the economy is already in a recession. Claudia Sahm, whose research is behind the rule, has said she does not think the economy is currently in a recession but worries that restrictive monetary policy could unnecessarily increase unemployment even more.

The article concludes:

The longer-run projection for the fed funds rate rose to 2.9 percent, four-tenths of a point above the 2.5 percent the Fed had consistently projected from 2019 through the end of last year. In the June projections, officials had indicated an expectation for a longer run rate of 2.8 percent.

On the other hand, unemployment is now seen as going higher. When the Fed last released projections in June, officials forecast a four percent rate of unemployment at year-end. The new projections have unemployment rising to 4.4 percent. Next year, unemployment is seen as staying at 4.4 percent, up from the earlier estimate of 4.2 percent. Similarly, the median projection for economic growth ticked down to two percent from 2.1 percent this year.

Eleven officials voted for the rate cut. One Fed governor, Michelle Bowman, dissented, preferring a quarter-point cut.

I am not an economist, so I don’t have a lot to say about this. However, I do think inflation has continued to be a problem that cutting interest rates might exacerbate. I am hoping that the Federal Reserve has made the right decision for the right reasons and that this is not a political move.

The New Jobs Report

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On Friday, The Epoch Times posted an article about the latest jobs report. The economy is cooling down, which will probably provide the Federal Reserve with an excuse to lower interest rates in the hope of providing a Democrat election victory.

The article reports:

The U.S. economy created fewer jobs than the market projected in August as the overheated labor market of the past few years continues to show signs of cooling off.

Last month, payrolls increased by 142,000, falling short of the consensus estimate of 160,000, according to the Bureau of Labor Statistics (BLS).

The unemployment rate eased to 4.2 percent, down from 4.3 percent in July. This was in line with economists’ expectations.

Average hourly wages surged at a higher-than-expected pace of 0.7 percent, up from a 0.1 percent drop in July—this was revised from the initial report of 0.2 percent growth. Average hourly earnings also climbed to a better-than-expected year-over-year rate of 3.8 percent, up from 3.6 percent.

The labor force participation rate was unchanged at 62.7 percent. Average weekly hours ticked up to 34.3 from 34.2.

Much of the job creation was concentrated in construction (34,000), health care (31,000), government (24,000), and social assistance (13,000).

There were some other interesting numbers in the report:

So far this year, the total number of downward job revisions equals 372,000.

The number of people working two or more jobs increased by 65,000 to 8.538 million.

In August, full-time jobs plummeted by more than 400,000, and part-time employment increased by 527,000.

Inflation is hurting all Americans, and until the government stops its runaway spending, inflation will continue to be a problem.

 

 

The Numbers Tell The Story

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On Monday, Real Clear Wire posted an article about how well women are doing under the Biden administration versus how well they did under President Trump.

The article reports:

Of the countless lies about Kamala Harris perpetuated by Democrats and their loyal stenographers in the mainstream media, one of the most egregious is that a Kamala Harris presidency will deliver historic economic opportunity for working women. Unfortunately for these desperate Democrats attempting to erase publicly available data, numbers tell the exact opposite story. Kamala Harris and Joe Biden saddled women with the largest pay cut, inflation crisis, tax hike, and economic crash so far this century, whereas President Trump delivered the greatest economic boost for American women of any modern day president. 

The median income for women increased every year during the Trump administration, reaching the highest on record in 2020. Real average weekly earnings increased 8.2% under President Trump yet decreased 3.9% under Joe Biden and Kamala Harris. The unemployment rate for women overall and for black women in particular reached a record low during President Trump’s term. In 2019, the workforce participation gap between men and women shrank to the narrowest in history. President Trump’s economy made history with the most women in the workforce ever.

This wasn’t by accident. Understanding that working women are also balancing families, President Trump delivered a pro-family economic agenda that included doubling the child tax credit from $1,000 to $2,000 per child and expanding eligibility. Nearly 40 million families received an average benefit of $2,200 under his leadership, totaling credits of approximately $88 billion.

There were a number of women in the Trump administration in upper-level positions that were balancing work and families. I suspect that their input helped create an economic environment where women could prosper.

The article also notes:

Families now need an extra $12,590 annually just to maintain the same standard of living they enjoyed three years ago, according to Congress’ Joint Economic Committee—and 67% of parents say inflation has impacted their ability to pay for their children’s education, school supplies, and extracurricular activities this past school year. The cost of childcare has increased 32% for the average family since 2019, and nearly two-thirds are spending 20% or more of their annual income on childcare. The average price for a pack of disposable diapers has increased 32% since 2019, and 47% of families reported struggling to afford them. In 2022, Joe Biden and Kamala Harris’ incompetence created a baby formula shortage, causing the price to soar to an all-time high. Some 44 million people were living in food insecure households in 2022, a 31% annual increase and the largest one-year increase since 2008.

Most of the speeches made so far at the Democrat Convention will go down as some of the best fiction in recent times.

Unfortunately, The Jobs Report Tells The Story

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The Biden administration has spent a lot of time trying to convince Americans that Bidenomics is working. Most Americans are not convinced because all of us buy groceries and gasoline on a regular basis. Now that the jobs numbers for April have been released, the true condition of the American economy is becoming obvious.

On Friday, Townhall reported the following:

The U.S. economy added 175,000 jobs in April according to the latest employment situation report from the Bureau of Labor Statistics released Friday morning, the smallest job gain in some six months and significantly below Wall Street estimates for the month.

It was expected that April would bring 240,000 to 250,000 new jobs, and the unemployment rate would remain at 3.8 percent. Instead, April was a big miss, and unemployment ticked up to 3.9 percent.

The article continued:

The labor force participation rate remained at 62.7 percent in April and the average workweek slipped down to 34.3 hours while average hourly wages rose 0.2 percent for a 12-month increase of 3.9 percent.

Comparing wage growth with inflation, the Consumer Price Index (CPI) showed core inflation was still running at an annualized 3.8 percent in March, meaning Americans’ wages are barely keeping up with still-rising costs.

The hourly wage numbers are a tribute to creative math. If the number of hours worked is decreased, but the income remains the same, it appears to be an increase on paper. It is not an actual increase. If I work 15 hours and make a total of $150, I earn $10 an hour. If I work 10 hours and make $150, I am making $15 an hour. My income has not increased, but my hourly wage has. So scaling down the average workweek increase the average hourly wage.

The article concludes:

“Today’s jobs report confirms the economy is reentering stagflation,” said Alfredo Ortiz, CEO of Job Creators Network, of Friday’s report. “Only 175,000 jobs were created last month, well below the recent average and expectations,” he emphasized. “More than half of new jobs were created in the unproductive government and quasi-government healthcare and social services sectors that don’t provide growth,” explained Ortiz. “Combined with slow economic growth and resurgent inflation, these jobs numbers suggest stagflation has returned.”

Welcome to the results of Bidenomics.

A Very Predictable Reaction To The New Law

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On Monday, The Wall Street Journal reported that California fast food restaurants are beginning to lay off workers in anticipation of the new minimum wage that will take place April 1.

The article reports:

A California state law is set to raise fast-food workers’ wages in April to $20 an hour. Some restaurants there are already laying off staff and reducing hours for workers as they try to cut costs.

California restaurants, particularly pizza joints, have outlined plans to cut hundreds of jobs in the months leading up to the April 1 wage mandate, according to state records. Other operators said they have halted hiring or are scaling back workers’ hours. 

Michael Ojeda, a Pizza Hut driver for eight years in Ontario, Calif., received notice in December that his last day would be in February, according to a letter from his former employer. Pizza Hut franchisee Southern California Pizza offered $400 in severance if he stayed through February, but Ojeda, who said he made hundreds of dollars a week in wages and tips as a delivery driver, went on unemployment instead. 

“Pizza Hut was my career for nearly a decade and with little to no notice it was taken away,” said Ojeda, 29, who previously supported his mother and partner on his Pizza Hut delivery wages. 

Southern California Pizza didn’t respond to requests for comment. Pizza Hut said it was aware of some of its California franchisees changing their delivery services. 

The article concludes:

Alexander Johnson, a second-generation owner of 10 California Auntie Anne’s and Cinnabon restaurants, said the higher wages would lift his labor costs by around $470,000 annually. He has reduced his staff by about 10, and his 73-year-old parents have returned to working in the business to help shave costs. 

Johnson said he turned down a recent offer to add a location in a waterfront tourist area in San Francisco because of the projected operating costs. 

“It pains me to think about shutting down stores or laying people off,” said Johnson, who moved to Nevada this year to open Scooter’s Coffee locations in the state. “I love California, and I’m very sad about what’s going on.”

This new law will also have a negative impact on people entering the workforce for the first time. Unemployment will increase under the new law, and it will be more difficult to find an entry-level job. Companies are not in the habit of training inexperienced workers at the rate of $20 an hour. I wonder how long this law will stay in place.

With Apologies To Abbott And Costello

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On Monday, John Droz posted an article in substack about the latest unemployment numbers.

The article notes:

Believe it or not (as this superb article explains), there are now SIX different US unemployment rates! Here are the latest (2023) government data for all six. The popularly referred to rates are 3.6% (U-3: unemployed) and 6.9% (U-6: out of work).

However, there is another large fly in the ointment: the unemployment rates (by-and-large) do not count illegal immigrants. When that number was low, it was ignored, as it was considered to be just statistical noise. Since 2020, that is no longer the case, as the current data says some six (6) million new illegal immigrants are in the US, just from the Southern border!

The article includes a spoof of Abbott and Costello’s Who’s On First routine. Here is a portion of that spoof:

COSTELLO: I want to talk about the unemployment rate in America.
ABBOTT: Good Subject. It’s 3.6%.

COSTELLO: That many people are out of work? 
ABBOTT: No, that’s 6.9%.

COSTELLO: You just said 3.6%.
ABBOTT: 3.6% are unemployed. 

COSTELLO: Right, 3.6% out of work.
ABBOTT: No, that’s 6.9%. 

COSTELLO: Okay, so it’s 6.9% unemployed.
ABBOTT: No, that’s 3.6%. 

COSTELLO: WAIT A MINUTE. Is it 3.6% or 6.9%?
ABBOTT: 3.6% are unemployed. 6.9% are out of work. 

COSTELLO: But if you are out of work, you are unemployed. 
ABBOTT: No, Biden said you can’t count those “Out of Work” as the unemployed. You have to be looking for work to be unemployed.

COSTELLO: BUT THEY ARE OUT OF WORK!!!
ABBOTT: No, you miss his point.

COSTELLO: What point?
ABBOTT: Someone who isn’t actively looking for work can’t be counted with those who look for work. It wouldn’t be fair.

COSTELLO: It wouldn’t be fair to whom? 
ABBOTT: The unemployed. 

COSTELLO: But they are ALL out of work. 
ABBOTT: No, the Unemployed are actively looking for work. Those who are Out of Work gave up looking. If you give up, you are no longer in the ranks of the Unemployed.

COSTELLO: So if you’re off the Unemployment roles that would count as less Unemployment? 
ABBOTT: Yes, unemployment would go down.

Follow the link above to read the rest of the spoof.

That is the reason the unemployment number is so low while so many people are out of work.

Behind The Jobs Numbers

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On Saturday, Zero Hedge posted an honest analysis of the jobs report that recently came out. It may be the only honest analysis out there. All of us know that the Biden economy is a problem for middle America–food inflation is in double digits, gas prices are lower than they have been but still a dollar or so a gallon more than they were under President Trump, and utility bills have increased dramatically in some places. President Biden may tell us that the economy is wonderful, but many of us living in it are not convinced. Just as an example, the total increase in my husband’s and my Social Security this year (after deducting the cost of Medicare) was about $115. I suspect that a lot of retirees didn’t even see that much of an increase. I can assure you that our grocery bill has gone up more than that.

The article at Zero Hedge is complicated and detailed. I suggest that  you follow the link and read it for yourselves. I will try to highlight some of it.

The article reports:

The headline data was stellar across the board, starting with the unemployment rate which once again failed to rise – denying expectations from “Sahm’s Rule” that a recession may have already started – all the way to average hourly earnings, which unexpectedly spiked from 4.1% (pre-revision) to 4.5%, the highest since last September, and a slap in the face to the Fed’s disinflation narrative…

… or it would be if one didn’t think of checking how the average rose: well, it turns out that, since average hourly earnings is a fraction, it did not rise due to a jump in actual wages but – since it is earnings over a period of time – “rose” because the BLS decided to sharply slash the number of estimated hours that everyone was working, from 34.3 to just 34.1, which may not sound like a lot until one realizes that the last time the workweek was this low was when the economy was shut down during covid.  Excluding the covid lockdowns, one would have to go back to 2010 to find a workweek that was this anemic.

The article concludes:

…Said otherwise, not only has all job creation in the past 4 years has been exclusively for foreign-born workers, but there has been zero job-creation for native born workers since July 2018!

This is a huge issue – especially at a time of an illegal alien flood at the border – and is about to become a huge political scandal, because once the inevitable recession finally hits, there will be millions of furious unemployed Americans demanding a more accurate explanation for what happened – i.e., the illegal immigration floodgates that were opened by the Biden admin.

Which is also why the Biden admin will do everything in his power to insure there is no official recession before November… and is why after the election is over, all economic hell will finally break loose. Until then, however, expect the jobs numbers to get more and more ridiculous.

The Numbers That Are Not Being Shared By The Mainstream Media

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On Thursday, Fox Business posted the following headline:

Layoffs surged 136% in January to second-highest level on record

The article reports:

The pace of job cuts by U.S. employers accelerated at the start of 2024, a sign the labor market is starting to deteriorate in the face of ongoing inflation and high interest rates.

That is according to a new report published by Challenger, Gray & Christmas, which found that companies planned 82,307 job cuts in January, a substantial 136% increase from the previous month. However, that is down about 20% from the same time one year ago. It marked the second-highest layoff total for the month of January in data going back to 2009.

“Waves of layoff announcements hit U.S.-based companies in January after a quiet fourth quarter,” said Andy Challenger, senior vice president of Challenger, Gray & Christmas. The cuts were “driven by broader economic trends and a strategic shift towards increased automation and AI adoption in various sectors, though in most cases, companies point to cost-cutting as the main driver for layoffs.”

According to the Bureau of Labor Statistics, the workforce participation rate has remained steady since December at 62.5, down from 62.8 in November. Generally hiring is up in November due to Christmas shoppers.

The article concludes:

Another source of layoffs in January was retail stores, which trimmed 5,364 positions in January, a significant increase from the 110 layoffs announced in December. 

The top reason cited for job cuts last month was restructuring; companies blamed stores closing and artificial intelligence for the layoffs, as well.

The labor market has remained historically tight over the past year, defying economists’ expectations for a slowdown. Although economists say it is beginning to normalize after last year’s blistering pace, it is nowhere near breaking. 

The findings precede the release of the more closely watched January jobs report from the Labor Department on Friday morning, which is expected to show that employers hired 180,000 workers, following a gain of 216,000 in December. 

The unemployment rate is expected to inch higher to 3.8%.

As more people are laid off, there will be less demand for consumer goods. This theoretically will slow inflation, but at the cost of the American people. If the government truly wanted to slow inflation without hurting the average American, they would cut government spending, but that is not likely to happen.

The Economy Is Questionable At Best

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I love it when a Democrat is in power–when unemployment rises it is always a surprise–even at Fox News.

On November 3rd, Fox News posted an article about the current state of the American economy.

The article reports:

U.S. job growth slowed more than expected in October, a sign the labor market is finally softening in the face of higher interest rates, stubborn inflation and other economic uncertainties.

Employers added 150,000 jobs in October, the Labor Department said in its monthly payroll report released Friday, missing the 180,000 jobs forecast by Refinitiv economists.

The unemployment rate, meanwhile, unexpectedly ticked up to 3.9% — the highest level in nearly two years. The pickup in the jobless rate suggests that layoffs are on the rise; the survey of households shows that the number of workers laid off rose in October by 92,000 from the previous month.

The unemployment number of 3.9% is not really a good measure of the economy unless it is looked at in relation to the workforce participation rate, currently slightly down at 62.7. Just to give some perspective, the workforce participation rate was 62.8% when President Trump took office in January 2017. It peaked at 63.3 in February 2020 (the ‘stop the spread’ shutdown began in March 2020). The reported unemployment rate is calculated only counting people who are looking for jobs. I suspect that if you counted everyone who is able to work but not working, the number would be much higher.

The article also notes:

The report also contained steep downward revisions to job growth at the end of the summer. Gains for August and September were revised down by a total of 101,000 jobs to a respective 165,000 and 297,000, the government said, suggesting that the labor market is weaker than it previously appeared.

The bottom line here is that the economy is not really growing although inflation is. For further details, please follow the link above to read the entire article.

 

Unemployment And The Workforce Participation Rate

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According to USA Today, the unemployment rate for June 2023 was 3.6 percent, down from 3.7 percent in May. However, according to the Bureau of Labor Statistics (BLS), the workforce participation rate remained unchanged at 62.6. The percentage of Americans in the workforce or looking for jobs has not changed since March. That is not an indication of a growing economy.

USA Today reports:

Hiring slowed but remained sturdy in June as U.S. employers added 209,000 jobs despite inflation, high interest rates and nagging recession fears.  

Still, that’s the weakest showing since employers shed jobs in December 2020.

The unemployment rate fell from 3.7% to 3.6%, the Labor Department said Friday. 

Economists had estimated that 225,000 jobs were added last month.

Payroll gains for April and May were revised down by a total of 110,000, depicting somewhat weaker hiring in the spring than believed. The May rise in jobs was downgraded to 306,000 from 339,000.

On Saturday, Breitbart reported:

During an interview on Bloomberg on Friday, White House Council of Economic Advisers Chair Jared Bernstein stated that the increase in the black unemployment rate “was statistically insignificant in June,” but the increase in black unemployment in May was statistically significant.

Co-host Romaine Bostic asked, “Well, what about some demographics? Our International Economics Correspondent Michael McKee pointed this out to me, that, when you look at unemployment rates in terms of demographics here, it went down for white men, it went down for white women, but it went up for blacks, it went up for Hispanics, and it went up for those who only have a high school education or less.”

How many minorities who have a high school education or less are being replaced in the labor force by the illegal aliens coming across our southern border? How many companies are hiring illegal aliens and paying them under the table at a much lower rate than Americans would accept? It is possible that this is part of the reason the minorities and people with a high school education or less are having trouble finding work?

A Different Reality

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On Friday, Breitbart posted an article about President Biden’s recent statements regarding raising the debt ceiling.

The article reports:

During an interview with MSNBC on Friday aired on Friday’s broadcast of “The 11th Hour,” President Joe Biden claimed that “no one’s ever tied” their budget to raising the debt ceiling and responded to charges that former President Donald Trump was willing to play ball on issues while he won’t by stating that Trump hurt the economy and increased debt, while the economy under the Biden presidency is doing well.

Biden said, “[T]he idea someone, for the first time, is saying, unless you pass this ridiculous budget I have — which is the way I would characterize what the Republican MAGA budget is — unless you pass this budget, we’re not going to increase the debt limit and we’re going to go bankrupt, we’re going to — the United States of America is going to renege for the first time in history on its debt. And you just can’t — no one’s ever tied them together before. I’ve said to the Republican leader, here’s the deal: Take the debt limit, pass it like you did three times when Trump was president, and he increased the whole national debt for 200 years by 40%.”

The article concludes with the following statement by President Biden:

Biden responded, “Play ball? He ballooned the debt, he created unemploy[ment]. Look, when I came to office, we had incredibly high unemployment, we were in a situation where we had very little movement on anything going on. And look at the employment rate now. Just today, 250,000 new jobs, highest participation in 75 years of women in the job market, lowest unemployment rate for African Americans. Things are moving.”

Actually, in January 2020, when President Biden took office, the overall unemployment rate was 3.5, the unemployment rate for women was 3.2, and the unemployment rate for African Americans was 6.3 (statistics here). The current unemployment rate is 3.4 (not a significant change), the unemployment rate for women is 3.1, and the unemployment rate for African Americans is 4.7 (that number is the only number that actually represents significant improvement). But before you get too excited about that, let’s look at the workforce participation rate (statistics here). In January 2020, the workforce participation rate was 63.3 overall, the workforce participation rate for women was 59.2, and the workforce participation rate for African Americans was 62.8. The current workforce participation rate is 62.6, the current workforce participation rate for women is 58.6, and the current workforce participation rate for African Americans is 63.0. These numbers illustrate just one area where President Biden is either seriously misinformed or is lying.

About That Speech

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On Thursday, The Federalist weighed in on President Biden’s State of the Union Speech.

Here are a few comments from the article:

Like Nero bragging about rebuilding Circus Maximus after burning it down, Joe Biden took to the podium tonight to take credit for solving a slew of problems he helped create.

At the top of his State of the Union address, the president boasted that he had “created more jobs in two years than any president created in four years.” No president — not Joe Biden nor Donald Trump — creates jobs. But Biden’s contention was exceptionally misleading, considering he inherited an economy that had been unplugged by an artificial, state-induced shutdown. If the government compels businesses to shutter, it doesn’t “create” jobs when allowing them to open.

Presidents don’t create jobs, but their policies create an atmosphere that either encourages or discourages economic growth. President Biden’s economic policies have not encouraged economic growth.

The article also notes:

Three years ago, the unemployment rate was at 3.5 percent. Today, Biden reminded us that it was at a historic low of 3.4 percent. More than 30 million people lost their jobs to Covid lockdowns. Biden claims to have “created” 12 million jobs during the past two years. The one big difference is that the labor participation rate still hasn’t recovered to pre-Covid numbers. It’s great that people are working again. But millions fewer are in the market for jobs.

The article concludes:

Biden went into his well-worn platitudes and myths about how the rich don’t pay taxes — “[n]o billionaire should be paying a lower tax rate than a school teacher or a firefighter!” — and proposed higher rates on the wealthy and corporations. He also promised to micromanage the economy with a slew of new regulations that would interfere in voluntary contracts struck between employees and employers and consumers and businesses.

Biden implored Congress to pass the PRO Act, a bill that would empower the government to impose unions on businesses and workers who want no part of them. Biden hawked an entire menu of crude economic populism — including price controls and protectionist trade policies that would undermine growth, competition, job creation, and innovation while driving up the cost of virtually every construction project in the country.

There were numerous lies, half-truths, and deceptions. There was a slew of antiquated economic ideas and sloganeering. But, surely, the president’s biggest lie of the night was to claim, “I’m a capitalist.”

We have a President who needs to take an Economics Course. He does not understand (or chooses to ignore) basic economic facts.

The Numbers Are Moving In The Wrong Direction

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On Friday, The Daily Caller reported that the unemployment number is up and the workforce participation rate is down. That is exactly opposite of what we would be seeing if the economy were growing.

The article reports:

The unemployment range has hovered between 3.5% to 3.7% since March, and labor force participation has hovered 1.2 percentage points below the pre-pandemic standard set in February 2020, the BLS reported. Monthly job growth has been slowing, with employers adding 372,000 jobs per month in the third quarter of 2022, down from 543,000 in the third quarter of 2021, according to The Wall Street Journal.

…The BLS data contradicts a Wednesday report from payroll firm ADP, which had estimated that the manufacturing sector had cut 20,000 jobs in October. In contrast, the BLS data finds that manufacturers added 32,000 jobs in October, slower than the 37,000 per month average in 2022, but faster than the 30,000 per month seen in 2021.

The Democrats are already claiming that if the Republicans take the house in the mid-term elections, there will be a serious recession. Actually, it doesn’t matter who takes the house in the mid-term elections–there will be a serious recession as a result of the policies put in place by the Biden administration. A Republican Congress may be able to reverse some of these policies, but I am not sure if they will be able to do it fast enough. Meanwhile, after the mid-terms we will probably be dealing with a diesel fuel shortage and severe supply chain problems created by the Biden administration’s energy problems (not by the war in Ukraine).

Your vote matters, and your vote will significantly impact your pocketbook.

Looking Past The Obvious

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On Friday, The Conservative Treehouse took a close look at the August jobs numbers. When you look past the obvious jobs increase, there are some troubling things hidden in those numbers.

The article reports:

The Bureau of Labor and Statistics (BLS) released the August Jobs Report [DATA HERE].

The topline is a net gain of 315,000 jobs with an increase in unemployment to 3.7%.  However, the June and July jobs reports were revised down by 107,000 lower than previously reported, and if you look carefully at the data, you can see a serious problem.

Keep in mind, in the background is a release yesterday showing productivity within the economy dropping in the second quarter by 4.1%. [DATA]  Combine the drop in productivity with higher wages of 5.7% and total wage costs per unit of business output are up 10.1%.  Now we turn back to today’s employment release, and look at these three points of data:

(1) Unemployment for adult men and unemployment for Latinos increased in August.  Adult men and specifically adult Latino men are losing their jobs. (2) The average number of hours worked in August dropped 0.1 hour to 34.5 hours. (3) Total employment amid those aged 16 to 19-years of age increased by 363, 000 in August:

…A total of 363,000 more teenagers started working in August, yet the total net gain in employment overall was 315,000 jobs. That should be the headline of the August 2022 jobs report.

The good news is that the workforce participation rate did increase from 62.1 in July to 62.4 in August. At least it is moving in the right direction. During the Trump administration, the workforce participation rate hit 63.4 in January and February of 2020.

The Real Reason Behind The Awful Jobs Report

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“Experts” predicted that the Biden administration would see 400,000 new jobs created in December. The actual number was 199,000. The good news is that the Workforce Participation Rate did not drop. It is holding steady at 61.9. That’s not a great number, but at least it is holding steady.

On Friday, Breitbart noted:

The jobless rates for whites fell half a percentage point to 3.2 percent, while the rate for blacks rose from 6.7 percent to 7.1 percent, according to data released by the Labor Department on Friday.

On Friday, The Conservative Treehouse posted an article detailing some of the reasons for the low jobs number. It’s not the coronavirus as President Biden claims.

The article reports:

Keep in mind, the November jobs report showed a decline in retail jobs of 29,000, and this report shows that despite November & December being the largest shopping months for holidays, the retail sector jobs were nonexistent.

The issue is what we have discussed here for months, inflation.

The job quits and JOLT turnover reports from last week showed massive numbers of employees quitting their jobs.  In part this is pressure from the vaccine mandate (more on that later).  However, in the majority what we are seeing is employment decisions based on inflation hitting the labor market.

Additionally, the current BLS report does not have the Omicron “winter of death” employment impact within it.  That impact will come in the January report, and it will not be good.  But let’s get down to reconciling December jobs data with reality on the ground.

Inflation is chewing up income amid the workforce.  This is not debatable, and this is reflected in every opinion poll and economic statistic that has surfaced for the past six months.   The BLS report somewhat surprised people in the 0.6% wage gains, and average wage increases are now 4.7% year over year.  That should be a good thing.  However, inflation at 20 to 50+% on energy, fuel, gasoline and food means a 4.7% growth in wages is a pittance.

Unfortunately, the article does not conclude with good news:

We have a looming problem that does not reconcile with 3.9% unemployment. The pundits are perplexed.

The confusion is because NO ECONOMIC data has ever shown this level of inflation in such a short period of time. There are no models. There is no experience in this situation. This is not like the 1970’s where oil prices were the direct and primary cause. This is different, because we are experiencing shortages and price increases specifically due to policy.

Energy policy is killing us (oil and natural gas prices). Legislative policy is killing us (spending and bailouts). Monetary policy is killing us (cheap lending, quantitative easing, devaluation). All of this is causing massive inflation at a level we have never seen in history, and it’s on everything.

Then we throw in a vaccine mandate, and perpetual fear of a virus that hits both the demand side and the employment side simultaneously…. and, well, here you go. The disruptions inside the economy are like deep cuts, thousands of them, and they are not accidental.

Many, if not most, of these disruptions are being done at the altar of climate change and the Green New Deal.

COVID-19 mitigation and mandates only make this worse.

The disruptions in the supply chain are a direct result of policy. Now, we have to prepare for inflation AND shortages. This will not get better in 2022.

Prepare your family accordingly. I believe those of you reading this article represent the people best prepared for what is about to happen.

Prepare for the worst, pray for the best.

Welcome To The Biden Economy

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The Epoch Times is reporting today that U.S. employers added fewer than 200,000 jobs in September. The workforce participation rate is slightly down from August at 61.6 (it was 61.7 in August).

The Epoch Times reports:

The Labor Department’s jobs report, released Oct. 8, shows that non-farm payroll employment rose by a paltry 194,000 last month, down from last month’s upwardly revised 366,000 and far below the FactSet-provided consensus forecasts of 500,000.

“The latest snapshot of the job market is a bit of a bad news, good news affair,” Bankrate senior economic analyst Mark Hamrick said in an emailed statement to The Epoch Times.

“It delivered a surprisingly weak payrolls number,” Hamrick said, adding, “at the same time, the nation’s unemployment rate slipped four-tenths to a pandemic era low of 4.8 percent.”

The total number of unemployed persons fell by 710,000 to 7.7 million, the report showed. While that’s considerably lower than the pandemic-era high, it remains elevated compared to the 5.7 million just prior to the outbreak.

Leisure and hospitality, including bars and restaurants, generated only 74,000 jobs, a result that’s below expectations. There was also weakness in local government educations jobs, which fell by 144,000 last month despite schools reopening.

There was relative strength in manufacturing, which added 27,000 jobs, and transportation and warehousing saw a jobs boost of 47,000 positions.

Overall, government payrolls fell by 123,000 jobs in September, which was offset by an increase of 317,000 in private payrolls.

The labor force participation rate, which is a measure of people working or actively looking for work, remained little changed at 61.6 percent, a historically depressed level. In February 2020, the labor force participation rate stood at 63.6 percent, with a historical peak of 67.3 percent in April 2000.

The article does note that the top ten states leading the economic recovery all have Republican governors. The article also notes that generally speaking red states have dominated the economic recovery.

The article also includes the White House attempt to spin the bad news:

White House Chief of Staff Ron Klain took to Twitter to defend President Joe Biden’s record on job creation.

“The unemployment rate is now down to 4.8 percent—in just eight months. We’ve created 2x more jobs under @POTUS in his first nine months than any administration in history,” Klain wrote.

Besides painting a dim view of the vigor of the labor market recovery, the lackluster jobs report could also delay an expected decision by the Federal Reserve to begin scaling back monetary support before the end of the year.

The labor market remains a key touchstone for the Fed, with Federal Reserve chair Jerome Powell repeatedly hinting that reaching full employment was a pre-requisite for the central bank to start trimming asset purchases.

Investors are looking for clues as to when the Fed will initiate the much-anticipated rollback of its massive $120 billion in monthly purchases of Treasury and mortgage securities, one of the crisis support measures the central bank deployed last year to help lift the economy from the pandemic recession.

If you are still looking for truth in the mainstream media, you are going to be on a long search.

Helping Or Hurting The Economy?

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NewsMax reported yesterday that according to Morning Consult’s latest poll, an estimated 1.84 million Americans turned down work to stay on the Biden administration’s jobless bonus payroll.

The article reports:

About one-third of unemployment benefit recipients have turned down job offers during the pandemic, including 45% of those who cited the unemployment benefits as a major factor in turning down the job and 13% who said unemployment benefits were the direct reason they turned down the job.

The article continues:

The national average of statewide unemployment payers was $387, so the average jobless American collecting the $300 bonus was netting $687 a week, which would equate to $17.17 hourly wage to remain out of work. That is more than double the current federal minimum wage and even higher than progressive Democrats’ plan to impose a $15 minimum wage nationwide.

The governors of 26 states nationwide have opted out of the Biden bonus early, shortening the duration from 12 weeks to five and excluding gig workers and independent contractors, according to Morning Consult.

The ending of the Biden bonus is a motivator for the unemployed to get back to work sooner, though, according to the poll.

Not only do 35% of all unemployment recipients feel a lot of pressure to find work, those who know their bonus is expiring soon are more likely to be feeling the pressure to find work. The difference is 20 percentage points as 45% whose benefits expired with a month feel pressure to find work, while just 25% over three months into the future said they feel pressure to get back to work, the poll found.

I don’t claim to be a rocket scientist, but it seems to me that if people can earn more by not working than by working, their choice is rather obvious. The extra unemployment benefits need to end quickly to get America back to work.

Stating The Obvious

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Breitbart is reporting today that Council of Economic Advisers chair Cecilia Rouse appeared on Fox News Sunday and stated that they expect to see some “transitory inflation” as America comes out of the coronavirus pandemic. Just for the record, the pandemic won’t be the cause of any “transitory inflation”–the runaway spending will be.

The article reports:

Rouse said, “These are very serious concerns, and we know that coming out of an extremely deep recession that there are going to be bumps along the way. We expect that there is going to be supply chain disruptions. That will cause some transitory increases in prices. ”

She continued, “We know that there are some places where employers are struggling to workers because, let’s face it — we’re still in the middle of the pandemic. Some workers would like to go back to work but have font child care because schools are not open and the pandemic is still out of control in certain parts of our country. When we get to the other side of this pandemic, I fully expect that our labor market will come back and be flourishing. That said, we do expect some transitory price increases. The Feds expects that as well. We do not see evidence at the moment that those have become what we call de-anchored so that we expect runaway inflation. That said, we know we have to be vigilant, and we are watching the data. We expect, at the most, transitory inflation. That is what we expect coming out of a big recession.”

First of all, the ‘big recession’ peaked in April of last year. The unemployment rate hit 14.8 in April and the Workforce Participation Rate hit 60.2. Both have been steadily improving for the last year. If you want to avoid inflation, stop flooding the economy with free money and encourage people to open up the schools and go back to work.

Policies Have Consequences

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So far the Biden administration has not been kind to American workers. If you work in the energy sector of the economy, you are in danger of losing your job–if you haven’t lost it already. Now there is another policy idea that will increase unemployment in America.

CNBC reported the following yesterday:

Raising the federal minimum wage to $15 an hour, as President Joe Biden has proposed, would cost 1.4 million jobs over the next four years while lifting 900,000 people out of poverty, according to a Congressional Budget Office report Monday.

The impact on the employment rolls is slightly higher than the 1.3 million employment estimate from a 2019 report from the CBO, a nonpartisan agency that provides budgetary analysis to Congress.

The number has been disputed by employment advocates who cite the benefits from the raise and say businesses will be able to handle the costs.

Biden has acknowledged that the plan to phase in the new federal wage floor likely won’t make it through the $1.9 trillion spending plan he is pushing through Congress, though he remains committed to the increase.

The CBO report estimates that the employment reduction would happen by 2025 and come as employers cut payroll to compensate for the increased costs.

Along with the reduction in employment, the federal budget deficit would increase by $54 billion over the next 10 years, a fairly negligible level considering the fiscal 2020 shortfall totaled more than $3 trillion.

There are a few facts being left out in this discussion. The minimum wage exists to allow new unskilled workers to enter the workplace. It exists for high school students looking for part-time jobs. It allows new unskilled workers to learn some basic skills that are applicable in any job–showing up on time, dressing appropriately, being reliable, taking responsibility, etc. Jobs that pay the minimum wage are not supposed to be career jobs–the people in those jobs are expected to increase their marketable skills and move up the employment ladder. Raising the minimum wage will result in a lot of high school students not being able to get jobs and learn the skills they need to succeed in the business world. Although raising the minimum wage sounds like a wonderful idea, the consequences will not be wonderful.

This Will Suppress Wage Growth For Unskilled Workers

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Yesterday Breitbart reported that as President, Joe Biden announced that he will provide U.S. citizenship to everyone who can show they were in the United States illegally on January 1. Has anyone actually thought this through? (Please look up the Cloward-Piven strategy if you are not familiar with it.) This is the equivalent of having ten people move in with your family and your being expected to feed and clothe them. It also needs to be understood that the people here illegally have a certain amount of disrespect for our laws–otherwise they would not have broken them to get here. This is also going to create a run on the southern border by people who figure they can forge the needed documents once they get here.

The article reports:

But the “rush to the border” is likely because migrants and the coyotes’ smuggling industry can backdate documents and forge new identities, especially when the prize is the opportunity to escape their lives in undeveloped countries and then become citizens of the United States of America.

“Biden, he’s going to help all of us,” one English-speaking Honduran told CNN on Sunday. “He’s given us 100 days to get to the U.S. and give us legal [unintelligible] paper so we can get a better life for our kids and family.”

The 1986 amnesty of roughly three million illegal aliens included much evidence of pre-computer fraud and a rejection rate of only about 12 percent, according to a government-sponsored study. Blue-collar household incomes have risen very little since the 1986 amnesty, although there was a sharp seven percent jump in 2019.

The Post‘s article did not include an estimate of how many migrants — and their chain-migration extended families — would benefit from an amnesty, nor did it allow any readers’ comments.

Biden’s plan will also remove any barrier to the inflow of white-collar workers who can earn a science or technology doctoral degree at one of the nation’s thousands of colleges and universities, the Post reported…

This will depress the wages of tech workers, making Biden’s supporters in Silicon Valley happy while hurting American workers. Adding thousands of unskilled workers will depress the wages of those American workers on the lower end of the pay scale. Added to the push for a $15 minimum wage, this will likely increase unemployment and poverty.

The election of Joe Biden represents the end of putting Americans first. I hope his voters are happy with being last.

Why Are We Still Doing This And What Does It Accomplish?

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On October 7th, Newsweek reported the following:

More than 6,000 scientists have signed an anti-lockdown petition saying that coronavirus policies are causing “irreparable damage.”

The petition, which is named the Great Barrington Declaration after the town in Massachusetts it was signed in, was written on October 4 and has signatures from at least 2,826 medical and public health scientists, 3,794 medical practitioners and over 60,000 members of the general public.

It was co-authored by Dr. Martin Kulldorff, a professor of medicine at Harvard; Dr. Sunetra Gupta, a professor at Oxford University; and Dr. Jay Bhattacharya, a professor at Stanford University Medical School.

“As infectious disease epidemiologists and public health scientists we have grave concerns about the damaging physical and mental health impacts of the prevailing COVID-19 policies, and recommend an approach we call Focused Protection,” the petition says in its opening line. “Current lockdown policies are producing devastating effects on short and long-term public health.”

…The petition also discusses its approach for vulnerable people, noting that implementing measures to protect this group “should be the central aim of public health responses to COVID-19.”

The petition offers a number of examples of how to protect vulnerable people, such as recommending that nursing homes use staff with acquired immunity and delivering groceries and other essential goods to those who are retired.

“Those who are not vulnerable should immediately be allowed to resume life as normal,” the petition says.

It goes on to say that simple hygiene measures, such as handwashing and staying home when sick, can help achieve the goal of herd immunity, while also noting that young adults should work from home and advocating a full reopening of the economy.

Meanwhile, Just the News posted an article today contrasting the current economic conditions between red and blue states.

The article reports:

As Democratic candidates across the nation harp on the economic devastation they attribute to the Trump administration’s mishandled COVID response, a closer look at state by state unemployment data reveals something far different: a tale of two economies on starkly divergent paths out of crushing shutdown economics. In “red” states, economic recovery is in full roar. “Blue” states, meanwhile, lag far behind, still staggering under unemployment levels associated with the deepest recessions. Suspended somewhere between these two poles are politically mixed “purple” states muddling through with fittingly middling unemployment numbers.

Just the News reviewed  U.S. Bureau of Labor Statistics unemployment data by state for August (the latest data available).The national unemployment rate — which now stands at 7.9% — was 8.4% in August. However, the economic pain represented by that number was not spread evenly across red, blue and purple states — far from it. Fueled by broader, faster economic reopenings following the initial coronavirus crash, conservative-leaning red states are by and large far outpacing liberal-leaning blue states in terms of putting people back to work.

Just the News found that 9 of the 10 states with the lowest unemployment rates are are led by Republican governors (Montana, led by Democratic Gov. Steve Bullock is the lone exception). In startling contrast, 9 of the 10 states with the highest unemployment rates are led by Democrats (the exception being Massachusetts, led by Republican Gov. Charlie Baker, a critic of President Trump).

Please follow the link above to read the entire article. This article illustrates why local elections matter. The states whose voters put Republicans in their state government are doing much better than the states being run by Democrats.

Good News On The Jobs Market

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Just the News posted an article today reporting that the U.S. added 4.8 million jobs during the month of June, the Bureau of Labor Statistics reported Thursday. The unemployment rate fell to 11.1%. Economists had estimated that 3 million jobs would be added.

The article reports:

The increase in jobs comes as businesses begin rehiring following the height of the coronavirus pandemic in April and May.

The unemployment rate also dropped more than expected. The Dow Jones predicted that it would fall to 12.4% in June. It was 13.3% in May.

We are definitely moving in the right direction.

The article concludes:

Also released this morning were the weekly jobless claims, which showed that 1.43 million Americans filed for first time unemployment benefits last week. This number was slightly higher than the expected 1.38 million.

The new numbers will help inform Congress later this month as they debate the possibility of expanding benefits for unemployed Americans.

The expanded benefits system has been providing the unemployed with an additional $600 a week, and covering workers who are not typically included in the state benefit systems.

Sections of the country have begun pausing their economic reopening efforts as the coronavirus spikes sharply in the south west.

It is likely that Congress will ultimately agree to extend those benefits, but decrease the $600 addition.

The $600 addition has been cited by many business owners as the reason some of their employees are not in a hurry to return to work. Whatever Congress subsidizes we will see more of. When unemployment is no longer subsidized, we will see less of it.

Experts Amazed–Again

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CNBC is reporting the following today:

Employment stunningly rose by 2.5 million in May and the jobless rate declined to 13.3%, according to data Friday from the Labor Department that was far better than economists had been expecting and indicated that an economic turnaround could be close at hand.

Economists surveyed by Dow Jones had been expecting payrolls to drop by 8.33 million and the unemployment rate to rise to 19.5% from April’s 14.7%. If Wall Street expectations had been accurate, it would have been the worst figure since the Great Depression.

As it turned out, May’s numbers showed the U.S. may well be on the road to recovery after its fastest plunge in history.

Experts are shocked. The mainstream media is disappointed. The Democrats are disheartened.

The workforce participation rate for May was 60.8. In April, it was 60.2. In March, it was 62.7, and in February it was 63.4. You can see the impact of the shutdown in that rate, and you can also see the hope for the future in that rate.

The current riots will not help anyone. However, oddly enough, where people choose to rebuild when the riots end, there will be jobs. Hopefully those jobs will go to the people in the neighborhood (who generally are not responsible for the rioting and looting). We will recover from the shutdown and the riots. Hopefully it will happen more quickly than the experts seem willing to believe.

Some Of The Problems With The Bill

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Heritage Action sent out a brief summary of some of the problems with the stimulus bill passed yesterday.

Here are the highlights:

Unfortunately, the CARES Act missed the mark and included policy provisions unrelated to the epidemic. Senate Minority Leader Chuck Schumer (D-N.Y.) used the suffering of Americans as a bargaining chip in order to push for these liberal policies:

    • $25 million for the John F. Kennedy Center for the Performing Arts in Washington, D.C.
    • $75 million for the Corporation For Public Broadcasting (NPR & PBS)
    • $75 million for the National Endowment for the Arts
    • $75 million for the National Endowment for the Humanities

Schumer also negotiated for an expansion to unemployment insurance (UI) that is harmful to the recovery of our economy—he referred to it as “unemployment insurance on steroids.”

Schumer’s UI expansion will pay many workers significantly more money to be unemployed than they would receive if they were working. This encourages people to become separated from their employers and discourages them from returning to work. This is not going to help the economy recover!

We should be doing everything possible to help people stay employed. If people stay employed, they will keep their health insurance at this critical time and they will be able to quickly return to work after the crisis has subdued.

This is the chart of where the money will go:

This is what happens when you have politicians in Washington who represent special interests and political agendas rather than the American voters who elected them. Let’s clean house in November.

In Case You Were Wondering Where The Holdup Was…

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Breitbart posted an article today about Congress’ attempt to deal with the coronavirus epidemic. As usual, Washington is playing politics and not getting things done.

The article reports:

House Speaker Nancy Pelosi (D-CA) said on Sunday that she has decided to move forward with her own emergency coronavirus relief package.

Pelosi spokes just hours before the Senate was scheduled to take a procedural vote that would lead towards a final vote on a bipartisan economic relief package. The bill would provide economic relief after the coronavirus epidemic ravaged the country’s economy.

“From my standpoint, we’re apart,” she said.

Subsequently, Senate leaders decided to delay a planned vote to 6 p.m. Sunday.

Senate Majority Leader Mitch McConnell (R-KY) said on the Senate floor on Sunday that he intended for the legislation to be bipartisan and aimed at helping the American people.

“What we have is a compromise product which contains ideas, contributions, and priorities on both sides and which could become law as soon as tomorrow,” he said. “In other words, it’s just about time to take yes for an answer.”

…Pelosi said that Republicans and Democrats are still “talking” but that there is no need to meet McConnell’s Monday deadline for a Senate vote on the coronavirus package.
Senate Republicans and the White House have insisted that they will continue to push for the $1.6 trillion economic relief package, which would include $350 billion in support for small businesses and $250 billion for unemployment insurance. The package would also include direct cash payments to individuals around $1,200 per individual, with additional funds going to families with children.
Politico reported Sunday that “it’s not clear how Pelosi’s plan would work — committee chairs have been frenetically compiling ideas for a legislative package, but are not yet ready for legislative text.”
Senate Majority Whip John Thune (R-SD) said this weekend, “The Democrats are getting some of the things they’ve asked for. They’re getting what they wanted on unemployment insurance.”
It seems as if Washington is functioning as usual. Congress will continue to work and get paid while many Americans lose their source of income because of the coronavirus. They are playing politics rather than doing what they can to help Americans in a crisis.