Posted on 10/14/2004 7:41:38 AM PDT by 1rudeboy
The U.S. economy has displayed a remarkable resilience following the bursting of the Internet bubble and the 9/11 terrorist attacks that struck at the heart of American business. The economys strength was such that the 2001 recession is among the weakest on record. Today, business investment continues on an unprecedented expansion and more Americans are working than ever before. Still, myths are rampant. This paper presents a basic statistical overview of the American economy and prosperity that Americans today enjoy.
I. Jobs, Employment, and Income
There are three main indicators that inform the issue of employment in America. First is the overall growth of jobs. Naturally, a net increase in employment is seen as progress, but this statistic really only matters if the population is growing. Economists have long believed that the key measure of employment is the percentage of people who are employed out of the entire population of potential workers. Many citizens simply dont want to work in the formal labor force, either because they are studying for advanced degrees, retired, or caring for other matters in the home. Thus, the unemployment rate is the best way to assess economic health. And another indicator to watch is labor compensation, which represents the quality of jobs for many observers.
Jobs: Payroll or Household?
The government provides many measures of job creation, but the two best known come from the Bureau of Labor Statistics payroll survey and the Census Bureau household survey. As widely reported, the two surveys are telling opposite stories.
Since January 2001, when President George W. Bush was sworn in, payroll jobs have declined by millions and recovered by millions, but still remain 900,000 jobs below their peak. (Source: Bureau of Labor Statistics)
On the other hand, the household survey reports a record high level of working Americans, with 1.8 million more jobs since January 2001. (Source: Bureau of Labor Statistics)
Ironically, both surveys may be correct because they count jobs differently. The household survey counts all jobs, including a growing but hard to define class of new economy workers such as part-time consultants, eBay entrepreneurs, and even real estate agentspeople who are not on payrolls. The payroll surveys name says it all. What it doesnt say is that payrolls provide a vast sample size, which some see as a sign of its unmatched accuracy. But the real question is whether its sample quality is clean, and in August, the BLS acknowledged that the survey has sample problems: it counts workers twice when they change jobs, which may account for between 400,000 and one million of the job difference between the two surveys. (See BLS, Effects of Job Changing on Payroll Survey Employment Trends.)
Unemployment and the Recession
Dissecting the Unemployment Rate
Labor Force Participation
Unemployment Claims
[The above four subsections are deleted to save space]
Real Earnings
Worker pay is a sign of job quality. The Labor Departments measure of real hourly earnings is one of many pay statistics and includes all monetary compensation but not benefits. It only counts earnings for non-executive workers, unlike other measures.
Manufacturing
II. Economic Growth
[The above section was deleted to save space]
III. Outsourcing and Insourcing
IV. Health Care
V. Poverty
VI. The Tax Cuts
[The above three sections are deleted to save space]
VII. Conclusion
The economy has added more than 1.5 million payroll jobs over the past year and nearly 2 million jobs on the household survey. Most indicators point towards continued growth. Output is booming, the manufacturing outlook is positive, business confidence is high, and productivity continues to set records. Even such favorites among economic pessimists like data on long-term unemployment, manufacturing employment, and worker discouragement are showing marked improvement. Unfortunately for the pessimists, these are the facts that frame the debate on the economy today.
Tim Kane, Ph.D., is Research Fellow, Rea S. Hederman is Senior Policy Analyst, and Kirk Johnson, Ph.D., is Senior Policy Analyst, in the Center for Data Analysis at The Heritage Foundation.
BTTT for later
That's stretching it a bit -- the way the OIFF counts these jobs includes a French company like Thomson buying RCA and then they've "insourced" a couple of thousand jobs without creating one. And they weren't "outsourced" from France either.
LOL. So all foreign companies do is buy U.S. companies. We all know that foreign companies never set-up shop here. In fact, the word "foreign subsidiary" is hardly in our vocabulary. Furthermore, with regard to "stretching" data, it happens on both sides. One cannot claim that certain data is inherently inaccurate (as it is), without recognizing that the inaccuracy cuts both ways. For example, a U.S. firm with a plant in Indiana buys its main competitor in Illinois. That firm then shuts the plant in Indiana and moves its assembly-lines to Illinois. Bingo! Net loss of high-paying manufacturing jobs in Indiana with possibly no net change in employment in Illinois. And Willie Green weeps.
I am astounded that this thread is not generating more interest. [chuckle]
No matter how well the economy or the job market does, if there is no job for Havoc then it is all for naught.
Willie is a stand-up guy. At least he supports his assertions with data, albeit with a little smoke thrown in. I respect him for that.
The government provides many measures of job creation, but the two best known come from the Bureau of Labor Statistics payroll survey and the Census Bureau household survey. As widely reported, the two surveys are telling opposite stories.
Since January 2001, when President George W. Bush was sworn in, payroll jobs have declined by millions and recovered by millions, but still remain 900,000 jobs below their peak. (Source: Bureau of Labor Statistics)
On the other hand, the household survey reports a record high level of working Americans, with 1.8 million more jobs since January 2001. (Source: Bureau of Labor Statistics)
Of course, we have been setting a new record for Americans working nearly every month of every non-recession year. In any case, it's easy to be misled by the large numbers being thrown about. The following table shows the average monthly and annual gain in jobs under every President since Roosevelt's last full term:
TOTAL NONFARM EMPLOYMENT (thousands) No. of Monthly Annual Term Mo Year Count Change Months Average Average --------------------------------------------------------------- Roosevelt Jan 1941 34480 7423 48 154.6 1856 Truman 1 Jan 1945 41903 2772 48 57.8 693 Truman 2 Jan 1949 44675 5470 48 114.0 1368 Eisenhower Jan 1953 50145 2743 48 57.1 686 Eisenhower Jan 1957 52888 795 48 16.6 199 Kennedy Jan 1961 53683 5900 48 122.9 1475 Johnson Jan 1965 59583 9855 48 205.3 2464 Nixon Jan 1969 69438 6182 48 128.8 1546 Nixon/Ford Jan 1973 75620 5072 48 105.7 1268 Carter Jan 1977 80692 10339 48 215.4 2585 Reagan 1 Jan 1981 91031 5322 48 110.9 1331 Reagan 2 Jan 1985 96353 10780 48 224.6 2695 G.H. Bush Jan 1989 107133 2592 48 54.0 648 Clinton 1 Jan 1993 109725 11507 48 239.7 2877 Clinton 2 Jan 1997 121232 11156 48 232.4 2789 G.W. Bush Jan 2001 132388 -821 44 -18.7 -224 Sep 2004 131567 ---------------------------------------------------------------- Total (Kennedy thru Clinton) 78705 480 164.0 1968 Total (Kennedy thru G.W. Bush) 77884 524 148.6 1784 Source: http://data.bls.gov/cgi-bin/surveymost?ce, Series CES0000000001
As the table shows, the average job gain from Kennedy through Clinton was about 164 thousand jobs per month and nearly 2 million jobs per year. If we accept the Household Survey of 1.8 million jobs over 44 months, that comes to about 40.9 thousand jobs per month. While that's not quite the worst performance since Hoover (it beats Eisenhower's second term), it's pretty close.
Not surprisingly, the growth in jobs has fallen behind the forecasts given in the last three Economic Reports of the President. The following graph shows the forecasts and the actual results according to the payroll and household surveys (the numbers can be seen at http://home.att.net/~rdavis2/employed.html):
Are you expecting a response? I deleted four subsections about un/employment. Should I post those?
No, you posted quite a bit in your initial posting. My point was simply to put the employment numbers in perspective. However, if you or anyone else should have any comments on the table or graph in my last message, feel free to post them.
BTTT
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