Wh-wh-what are they saying? That's there's a fixed amount of work to be done? That there's only so much work to go round? Why, that's one of the best-known fallacies in economics!
I hear there's positions opening up every day in the rapidly-growing green-shoots-spotting industry. On Thu, Jul 2, 2009 at 2:31 PM, Jim Devine <[email protected]> wrote: > > http://www.latimes.com/business/la-fi-jobless-recovery2-2009jul02,0,1266091.story > > >From the Los Angeles Times > > Hiring might not rebound in an economic recovery > After upheaval in the auto and financial sectors, many workers may > find the jobs they lost are gone forever. > By Don Lee > > July 2, 2009 > > Reporting from Washington — Even as the nation's economy begins > clawing its way out of the worst recession in 60 years, there are > growing signs that this recovery could come with an unsettling twist: > The wheels of commerce may begin to turn again without any substantial > boost in jobs. > > Not only is the national unemployment rate, now 9.4%, likely to climb > into double digits later this year, but it is also expected to remain > there well into 2010, economists say. That would prolong the misery of > the unemployed, squeeze retailers and other businesses, and add > millions of dollars in government costs and lost productivity. It > could even threaten the recovery itself. > > Though it's common for the jobless rate to keep climbing for a time > after economic output turns positive, the aftermath of the last two > downturns, in 1990-91 and 2001, introduced the idea of a "jobless > recovery." Even though the economy improved, many unemployed workers > discovered that jobs as good as the ones they'd lost were almost > impossible to find. > > This time, many economists say, there are new factors that could make > the problem worse. Many more layoffs in this recession have been > permanent, not temporary. > > And mass layoffs are continuing at a record pace; in May they cost > nearly 313,000 workers their jobs. Since the recession began in > December 2007, the U.S. economy has shed 6 million payroll jobs. That > tally is expected to grow today when the Labor Department releases the > June employment figures. > > Also, instead of shrinking operations, companies have shut down whole > business units or made sweeping structural changes: General Motors > Corp. and Chrysler, for example, closed hundreds of dealerships. > Citigroup Inc. and Bank of America Corp. cut tens of thousands of > positions. > > In addition, workers who survived job cuts are, on average, working > fewer hours per week than ever before, according to Labor Department > statistics. That means employers, even when they feel confident enough > about the recovery to expand, will begin by giving more hours to > existing employees instead of hiring new ones. > > More troubling still is the outlook for consumer spending, the main > driver of the U.S. economy. If people don't spend, many businesses > simply won't have the means or the need to hire employees. > > Indeed, the depth of this recession, plus widespread expectations that > unemployment will keep rising into 2010 and remain high thereafter, > may exert a powerful drag on the recovery. > > Shortly after the 1990-91 recession, consumers went out and bought > houses, cars and other expensive goods on credit, noted Richard > Curtin, director of the University of Michigan consumer sentiment > survey. > > That helped boost job growth in construction, manufacturing and other > industries. > > But this time around, because of the severe credit crunch, people > won't be able to get financing as easily, and those who can borrow > will be reluctant to do so, Curtin's surveys indicate. > > Instead of leading the way to a more vigorous economy, consumers are > saying they want to save and keep their personal debts low. Americans > socked away almost 7% of their after-tax income in May, the highest > rate in 15 years. > > "What this means is that we're going to have a slow-growing consumer > sector," Curtin said. So even though the federal government's stimulus > spending is likely to pick up some of the consumption slack next year, > he said, "spending is expected to slow down in 2011 and disappear in > 2012." > > That's what scares Howard Roth, chief economist at California's > Department of Finance. The Golden State has been hit particularly hard > by the housing meltdown, and its jobless rate has already climbed to > 11.5%. > > "If you look at the situation of consumers -- home equity, it's gone > away. The stock market has wiped away retirement savings," Roth said. > "The consumers are not going to be able to spend as much as before." > > Analysts say there are factors that could mitigate the jobless recovery. > > Healthcare and government employers are expected to continue hiring. > Green industries are emerging and will need more people. > > What's more, companies today aren't seeing the kind of sharp gains in > productivity that previously allowed them to expand output without > adding workers, so this time, if a company wants to produce more, it > may have to hire. > > And with wages depressed because more people are unemployed, adding to > the workforce will be cheaper. Many employers already have cut to the > bone. > > At Quality Float Works Inc., a Chicago-area manufacturer of industrial > floats and valves, employment has shrunk to 15 from 20 a year ago. > Some of the remaining employees are older workers who in ordinary > times might have retired, said Sandra Westlund-Deenihan, the company's > president. > > "Their 401(k)s became 201(k)s. They stayed on with us," she said. When > they are ready to leave, she added, it will create a wave of openings, > but just when that will happen is anybody's guess. > > Her son, Jason Speer, the company's vice president, says he'll wait > for several months of stable business before he even considers hiring. > "We're not there yet," he said. > > For workers, "it's going to be a difficult slog back," said Sophia > Koropeckyj, a labor economist at Moody's Economy.com in West Chester, > Pa. Though the economy is expected to grow again this year, analysts > say, meaningful job growth won't happen until 2011 at the earliest. > > All this spells trouble for the Obama administration, which is facing > increased pressure to show results from its massive stimulus package > and other intervention in the economy. Obama's public approval > ratings, though still high, have slipped lately, in large part because > of waning support for his handling of the economy. > > Obama's economic aides say the job situation would have been much > worse without his $787-billion stimulus plan. By the end of next year, > the administration's recovery efforts will have created or saved 3.5 > million jobs, according to Jared Bernstein, chief economist and > economic policy advisor to Vice President Joe Biden. > > Analysts say it is a reasonable estimate, though it has been sharply > criticized by Republicans. But that still leaves a huge job deficit. > Bernstein declined to give a forecast of unemployment and the economic > recovery, saying they will be addressed in a White House report to be > released later this summer. > > Until job growth revives, the administration is extending unemployment > benefits for workers and investing $4 billion into worker training > programs, Labor Secretary Hilda Solis said. > > Obama also touts a surge in green jobs as a result of his policy. But > most analysts say it will take several years before a substantial > number of such jobs begin to appear. > > Expectations in manufacturing aren't high either. Factory payrolls > never rebounded after the 2001 tech-bubble recession, in large part > because jobs were permanently lost to foreign rivals or productivity > gains. This time may be no different, with hundreds of thousands of > jobs cut in automobile-related industries. > > Construction and finance payrolls also are likely to remain subdued, > as are retail and trade. > > All of which leads Kim Megonigal, chief executive of Kimco Staffing > Services Inc. of Irvine, to ask: Which sector is going to lead the > recovery? > > "I don't see any job drivers other than government," said Megonigal, > whose firm has 25 offices in California. > > "A year ago, we were filling 600 jobs a week," he said. "We're down to > 150." > > Temporary-help firms are often the first to see evidence of a rebound > in jobs after a recession. But Megonigal doesn't see anything stirring > at the moment. He says he started his firm in 1986 but has never seen > anything like this. > > "Employers are telling us to wait, they don't know. It's a lack of > confidence." > > [email protected] > > Copyright 2009 Los Angeles Times > > -- > Jim Devine / "Segui il tuo corso, e lascia dir le genti." (Go your own > way and let people talk.) -- Karl, paraphrasing Dante. > _______________________________________________ > pen-l mailing list > [email protected] > https://lists.csuchico.edu/mailman/listinfo/pen-l > -- Sandwichman
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