Monday, September 15, 2014

Jobs & National Defense

According to the U.S. Bureau of Labor Statistics, in August 2008 the non-farming civilian labor force (workers age 16 and older) numbered 154,641,000. In August 2014, it numbered 155,959,000, for an increase in six years of less than one percent while the population grew about four percent. If it had grown at the rate of population growth, the work force would number about 163,000,000, or about 7 million more taxpayers than contribute now, especially important since nearly half of all households pay no taxes.

In August 2008, the unemployed workers numbered 9,438,000. In August 2014, that number was 9,591,000, or an increase in the unemployed of 1.6%. The officially announced unemployment rate in August of both 2008 and 2014 was the same, 6.1%. Obviously, the facts give the lie to the current unemployment rate claimed by the administration unless, of course, either the books have been cooked or there are mitigating circumstances.

There are circumstances alright, but aggravating rather than mitigating. According to the BLS, in August there were 2,141,000 workers marginally attached to the work force, i.e., they want to work, are available and classified as looking for work for at least a year, but not for the last four weeks. There are 775,000 who are absolutely discouraged. So, the unemployment figure actually is not 9,591,000 but 11,732,000 (not counting the discouraged), or 25% greater than the unemployment number in August 2008. The official unemployment rate of 6.1% is fiction. It's at least 8%, probably much higher.

The constant drumbeat by the administration about all the jobs that have been “created” in any period since 2008 is ill advised in light of the figures. The practical concern has to do with job-loss as well as job-creation. The impact of job-loss since 2008 far outweighs that of job-creation. The bottom line has to do with with the net job-outcome. According to Bloomberg of 02 May 2014, only 62.8% of the eligible work-force is at work, with that rate matching the lowest since March 1978.

According to PBS of 21 February 2014, the BLS has determined that only 27% of jobs in the U.S. economy currently require a college degree (associate degree or higher). By comparison, the Current Population Survey, a monthly survey of 60,000 households conducted by the U.S. Census Bureau, showed that 47 percent of workers have an associate degree or higher. This amounts to huge personal education-debt for no financial reason.

According to Pew Research (Dec. 2010), 10,000 people turn age 65 every day and this phenomenon will obtain through 2029 (baby-boomers). According to Pew, the typical boomer considers old age to be 72, thus a reluctance by many to retire. There are roughly 3.1 million high-school graduates per year. The National Center for Education Statistics projected 1.6 million college graduates in 2014. According to ACURA, just under 66% of high-school grads enrolled in college in 2013, leaving 2 million to enter the work force. This means a total of abut 3.6 million young people chasing jobs currently.

In 2014, there's been an average increase of 215,000 jobs per month. If this is maintained, about 2.6 million new jobs could be expected this year, with at least 3.6 million young people people chasing them in addition to the 11.7 million unemployed. Even if the boomers all quit at age 65, that would present only 3.7 million additional job openings.

These discouraging statistics come at a time when the administration is actively, as promised, regulating many enterprises into downsizing, bankruptcy or otherwise going out of business, thus enhancing stagnation/regression at a time when a vibrant economy is urgently required and the nation plods (but for how long?) on borrowed/printed money.

The U.S. must have the financial resources to support both a civil and a military establishment—the latter now being dangerously depleted—that can protect the nation, especially in light of the Islamic jihad-threat. This means it must maintain a huge work-force turning out goods and services and thus earning wages to be taxed sufficiently to maintain national defense but not to the extent of killing incentive. The so-called middle class (if there is one anymore) will bear the brunt.

And so it goes.
Jim Clark


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