Posted on 07/14/2009 8:56:40 AM PDT by reaganaut1
The recent unemployment numbers have undermined confidence that we might be nearing the bottom of the recession. What we can see on the surface is disconcerting enough, but the inside numbers are just as bad.
[...]
Here are 10 reasons we are in even more trouble than the 9.5% unemployment rate indicates:
- June's total assumed 185,000 people at work who probably were not. The government could not identify them; it made an assumption about trends. [...]
- More companies are asking employees to take unpaid leave. These people don't count on the unemployment roll.
- No fewer than 1.4 million people wanted or were available for work in the last 12 months but were not counted. Why? Because they hadn't searched for work in the four weeks preceding the survey.
- The number of workers taking part-time jobs due to the slack economy, a kind of stealth underemployment, has doubled in this recession to about nine million, or 5.8% of the work force. [...]
- The average work week for rank-and-file employees in the private sector, roughly 80% of the work force, slipped to 33 hours. [...]
- The average length of official unemployment increased to 24.5 weeks, the longest since government began tracking this data in 1948. [...]
- The average worker saw no wage gains in June, with average compensation running flat at $18.53 an hour.
- The goods producing sector is losing the most jobs -- 223,000 in the last report alone.
- The prospects for job creation are equally distressing. [...]
(Excerpt) Read more at online.wsj.com ...
http://www.nytimes.com/2009/07/15/business/15goldman.html
Goldman Sachs Reports Big Profit, Beating Forecasts
“Our company did not layoff, but we all got 20% reductions in pay.”
My Mother-in-law’s company gave everyone (including the company President) a 10% pay cut, a four day work week - unless specifically told to work to complete projects and everyone has to pay about 3% more of their health insurance. For her, it was about a 24% pay CUT, BUT at least she was not laid off.
What he is saying is different, however. The situation is much worse than the actual numbers plus the outlook for growth is pessimistic. He bases this upon puny economic growth, inadequate state tax revenue driving higher taxes/reduced spending and evaporation/disappearance of job creating businesses.
Consumers have traditionally led recoveries. With limited available sources of funds (home equity, credit cards and reduced payrolls) it is hard to see this recovery-by-consumer happening.
We need to start making stuff again.
schu
I quite agree with you that we got to start making stuff but that is unlikely to happen in an economy with rising taxes, rising energy costs, rising inflation, shrinking demand, rising regulation and a well grounded fear that America has abandoned the rule of law and the free-market model for a socialist/cronyism model represented by Goldman Sachs and General Electric.
Your average liberal thinks that Goldman is “republican” because it has big money and only republicans are greedy and bad. If you look at who works there, they all voted Obama.
Can't, the profit margin is smaller than the taxes. Make here, make now is a charity to the liberal wish list that is built on the blood and backs of the workers. When China can make the product cheaper than the business taxes cost in America the game is over.
We cannot make more than the junkie can shoot up his veins and that is what our congress is, a junkie addicted to OPiuM (Other Peoples Money).
Atlas did not shrug, he collapsed under taxes and regulations.
Hyperinflation is enevitable when printing money is the only source of capitol. Congress is voting money into existance and printing IOU's. I suspect paying off your morgage or at least your car so you have someplace to sleep in out of the rain is better than a bank account.
I read a story of when Russia did this, one friday night you went to bed with enough "dollars" to buy a nice car, monday morning you woke up with enough "Ameros" to buy some cabbage for soup.
History is a hard to refute indicator.
You got a nagging car problem that you have not paid to get fixed? Roof leak? Fix it. Spent that dollar while people still think it has some value.
FR understatement of the day.
Thank you for your posts. - bill
Very good advice by the way.
And it is happening right before our eyes. Our children will ask how we could let it happen....
schu
When this comes down to a great depression and beyond it will not be how we let it happened but what did you do during the war Grandpa...
Hope you are right, but the name Hoover has a certain negative ring to it. :-)
While he was a brilliant man, his economic ideas were not so great.
schu
Yup...wife is at work and while we have “some money”, we are stocking up on canned goods, ammo, line of credit, clothing, etc.
I have NO idea what’s around the corner, but I am not going around that corner unprepared!
He is right. He just didn’t explain that any number of years or even decades can be expressed in months like mortgages. By the end of a 360 month mortgage term everything should be fine.
Good point. I definitely am considering my options...am a reporter for a paper and don’t make much money, but I like it and enjoy working for a paper that is fairly conservative and not still decent-size. Our paper is doing okay, but the chain is not doing so well and passing down edicts like pay cuts even though we are doing okay.
Heaven knows how soon actual layoffs may start. I am afraid I will have to leave before it’s too late and find a new field actually providing a living wage. :)
Always been interested in medicine, particularly a PA.
“We need to start making stuff again.”
/////////////////////////////////////////////////////////
We will very soon! We will start making two wheel carts out of our cars but unlike my grandparents generation we won’t have any horses or mules to pull them so we will have to pull them ourselves. We will also start making fires outside to cook on when the electricity and gas are shut off. Fortunately I have plenty of hardwood here where I live and I have squirrels in the trees and a .22 rifle and 2 or 3 thousand long rifle rounds. I also have a shotgun and ammo and a .270 rifle and some ammo and there are deer around here and there are catfish in the creek behind the house. Yep, I should be in real good shape. Now how was it that guy told me to cook Raccoon? Oh, that’s another thing we will start making again, Coonskin caps!
The economy cannot be worse than I think it is. I believe it is WAY worse than any goobermint data shows. Unemployment is really more like 14% and will go even higher as severance packages run out. It is also clear to me that in reality we are in the 3rd quarter of a depression - at least in much of the country.
LOL!! I question the timing of his death!
I’ve got to wonder about some of these wage/benefits cuts. I know a guy that works for a hospital linen provider. The TARP deal wasn’t even worked out late last year when his employer announced that there would be no raises due to the bad economy. Notice that there hasn’t been a drop in hospital business (government and health care being the only two industries to thrive these days). I’m just skeptical that businesses are using the economy as an excuse to make unnecessary cuts.
You got a nagging car problem that you have not paid to get fixed? Roof leak? Fix it. Spent that dollar while people still think it has some value.
///////////////////////////////////////////////////////////
Fortunately we have a place to live with no mortgage and a car and a pickup truck with no debt. I tell my wife that if we were half smart we would take every dime we could borrow unsecured and buy silver coins, ammunition, whiskey, freeze dried food and gold and never pay a dime on the debt. We would lose our credit rating but soon it won’t matter anyway.
She says she couldn’t do that because it would be dishonest at which point I sneer and ask her how we could possibly be any less honest than our government. Maybe I will do it anyway, she will thank me later when the final turd hits the wind machine.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.