U.S. Aug personal income rose 0.2 pct

Biz.Yahoo/Reuters ^ | September 29, 2003

[Starwind]

U.S. Aug personal income rose 0.2 pct
Monday September 29, 8:32 am ET

 WASHINGTON, Sept. 29 (Reuters) - U.S. Commerce Department
personal income and spending estimates, in seasonally adjusted
annual rates.
 Percent Changes, current dollars
.                         Aug     Jul     Jun     May
Personal Income           0.2     0.3     0.4     0.4
  Wages/Salaries           0.1    unch     0.4     0.3
  Disposable Income        0.9     1.5     0.4     0.4
Personal Consumption      0.8     0.9     0.7     0.5
  Durables                 2.8     3.3     0.9     0.6
  Nondurables              0.9     0.9     1.0     0.2
  Services                 0.3     0.5     0.5     0.6
Saving Rate, pct          3.8     3.6     3.0     3.3
 Percent Changes, chained '96 dollars
.                         Aug     Jul     Jun     May
Personal Consumption      0.5     0.7     0.5     0.6
  Durables                 3.0     3.5     1.2     1.2
  Nondurables              0.3     0.7     0.7     0.8
  Services                 0.1     0.2     0.2     0.3
Disposable Income         0.6     1.3     0.2     0.5
 Percent Changes, chained '96 dollars
.                         Aug     Jul     Jun     May
PCE Price Index           0.3     0.2     0.2    -0.1
Core PCE Price Index      0.1     0.2     0.2    unch
 Current Dollars, in billions
.                         Aug     Jul     Jun     May
Personal Income         9,239   9,217   9,193   9,155
  Wages/Salaries         5,102   5,096   5,096   5,078
  Disposable Income      8,306   8,232   8,107   8,073
 Personal Income by sector, current dollars, in billions
.                         Aug     Jul     Jun     May
Manufacturing             746     746     749     747
Service Industries      1,969   1,967   1,961   1,956
Government                892     891     895     889
Proprietors' Income       831     829     815     804
  Farm                      21      19      15      15
  Nonfarm                  810     810     800     788
Personal Consumption    7,778   7,718   7,646   7,593
  Durables                 963     937     908     900
  Nondurables            2,260   2,240   2,220   2,197
  Services               4,554   4,540   4,519   4,496
 Chained '96 dollars, in billions
.                         Aug     Jul     Jun     May
Personal Consumption    6,851   6,817   6,768   6,736
  Durables               1,145   1,112   1,074   1,061
  Nondurables            2,019   2,013   2,000   1,986
  Services               3,749   3,745   3,738   3,729
Disposable Income       7,316   7,271   7,176   7,162
 FORECASTS:
 Reuters survey of Wall Street economists forecast:
 U.S. Aug personal income +0.3 pct
 U.S. Aug personal spending +0.8 pct

[Starwind]

The full BEA report is at PERSONAL INCOME AND OUTLAYS: AUGUST 2003</>

[Starwind]

Fyi...

[raybbr]

I know all the super-capitalists in this group are going to try to show this as an indication of how much better we are. However, with the loss of 2.3 million jobs, how can income be up?

I looked over the report and can't find any categories based on yearly earnings. If they could break it down into wage groups (0-25K, 26-50K, 50-100K, 100-200K, etc.) I am betting that it would show that the upper levels grew and the lower levels actually went down. Also, the Bush rebate? Is that calculated into this?

It's sounds like I am saying the rich are getting richer and the poor are getting poorer. I am not saying that. (Actually I am) I am saying that people with money are able to invest and use their money to make more money. Whereas we are forced to pay of our disposable income to pay higher taxes and higher costs of health care, etc.

Don't start with the envy crap either. I am not envious but rather trying to point out the rich people are insulated from these cycles that we are experiencing. And, these reports are not telling the whole truth. It is not broken down enough to give us the whole picture of wages in the U.S.

I am getting out my:

[LS]

Well, I'll break it down for you---and I'm not a "super capitalist." 1) I had tax cuts that left me with more disposable income; 2) I got a small wage increase that more than offset the slightly higher energy costs; 3) my stock portfolio increased about 10% in about two months, meaning my retirement increased about 5% (because half is in bonds); based on local home valuations, my house has increased in value about $25k in less than 10 years.

None of that takes into account that I received a bunch of new contracts for free-lance work beyond my salary that I didn't have two years ago. I think that's pretty damn good.

[Rokke]

The non-super-capitalists refuse to admit that a 6.1% unemployment rate is not as apocolyptic as the democrat presidential candidates would like us to believe. When 93.9% of your nation is employed, it doesn't take a huge income gain to offset the unemployed.

[arete]

When 93.9% of your nation is employed, it doesn't take a huge income gain to offset the unemployed.

I want to know how you can possibly say that 93.9% of the nation is employed. Point to any indicator or report that you choose. Just prove your nonsense.

Richard W.

[raybbr]

I am glad for you. BTW I am not doing so bad myself. My wife and I have a nice house, a one year old son, a couple of lousy cars, etc.

My concern is that this country, through the misinformation from both sides of this issue, are ignoring the problems of today. They are problems, that taken each by themself, is not unmanagable. However, the aggregate effect of what is happening, unless reversed will destroy the America we have today.

[raybbr]

that taken each by themself

should be:...each taken by itself...

It didn't read right the first time. The preview and the post button should be on opposite sides of the page.

[Rokke]

Welllll, according to current figures, within our population there exists a 6.1% unemployment rate. That leaves 93.9% of people within that same group who are NOT unemployed. If you aren't unemployed, you must be employed in some capacity. It's not hard to prove simple math, although since you are a chronic "the glass is half empty" kind of a guy, I suppose you could figure out some way to make simple math look like the end of the world.

[Starwind]

Welllll, according to current figures, within our population there exists a 6.1% unemployment rate. That leaves 93.9% of people within that same group who are NOT unemployed.

Actually, your math yields an employment rate, not a total employed amount. Further, the unemployment rate you cite actually counts only those people who receive unemployment benefits. Once their benefits expire (after 13 or 26-28 weeks) they are no longer included in the 6.1% unemployment rate you cite, even if they do not have a job.

Total employed as per the household survey is perhaps 137,625,000 and unemployed 8,905,000 and the un(der)employment rate closer to 10.0%, as per THE EMPLOYMENT SITUATION: AUGUST 2003

[LS]

I agree, we have big problems: taxes are still too high; affirmative action/PC stuff in industry and academia is out of control; regulations, especially from the EPA, are oppressive; and we have the obvious border control problem.

I just get sick of the gloomsterism, because I believe that the Bible speaks the truth when it says "life an death are in the power of the tongue," and, to an extent, what you say is what you get. Tell a kid he's stupid for 20 years, and he begins to act stupid. Well, to an extent, the same is true of the economy. Optimism is both real and perceived, and we should at least change the perceptions, which bolster (as Keynes said) the "animal spirits" of investment and entrepreneurship.

[Rokke]

OK. Thanks for the link. Let me restate my statement...93.9% of our labor force is currently employed. That means 137.6 million people employed vs. 8.9 people unemployed. I will restate, that 93.9% of the labor force doesn't need much of a pay raise to offset the 6.1% of the unemployed labor force. I have no idea where you get your 10% number, as the link you provided has no data available to guage current "underemployment". Regardless, let's assume the unemployment rate is currently 10% (it's not). I will reiterate that it doesn't take much of a pay raise amongst 132 million employed worker to offset 14 million unemployed.

There is actually good news out there. So, despite the utterings of total despair and defeat by the doom and gloomers on this site, we are not nearing the end of times with regard to the economy and job market in this country.

[Starwind]

I have no idea where you get your 10% number, as the link you provided has no data available to guage current "underemployment".

Table A-12, line U-6, same link.

[raybbr]

Optimism is both real and perceived, and we should at least change the perceptions, which bolster (as Keynes said) the "animal spirits" of investment and entrepreneurship.

Were Bush and his election team, then able to "talk down the economy" as many have suggested? Is this then what the democrats have accomplished in recent months?

People like you and I have no power in the economy. (Unless your real name is Alan Greenspan) We, the commoners, are virtually at the beck and call of the academic elite and the bosses of industry and finance.

For example: When Bush's tax cut came out what did they want us to do? Spend it. Not pay down debt with it. Why?

I understand that there are three tenets of economics. Government, Business and home.

The Government does whatever it pleases. Nobody is safe from the clutches of taxes. Today's government, despite their extolling participation, rely on voter apathy. This has been accomplished many different ways. Government then defers it's bills until they feel like paying them.

Business economics is fraught with loopholes, not just for taxes but other purposes as well. For instance; the company I work for is a subsidiary of a very large corporation. If we choose to make a capital improvement, we must borrow the money from corporate at 17%. You can get a capital loan these days for about 5% from a bank. At the same time we are told that are salaries must remain stagant due to lack of funds. We are also limited to what vendors we can use. My boss is no longer allowed to shop around for the price of motors, etc. He must use approved vendors no matter the cost. Not only that but our company does not pay vendors until they 90 days due.

Then there is home economics. The economics you and I must apply to our mortgages and bills. We have to pay on time or else.

So, to apply standard finance practices to us and to other entities of our economy just don't work. There are different rules. Like I said in the original post. Looking at these numbers is fruitless. They have been manipulated to present a rosy picture.

I do not practice doom and gloom. I do see some serious problems ahead for our country. Not the least of which you have noted. I do fear for the future of my son, though.

[Rokke]

"Total unemployed, plus all marginally attached workers, plus total employed part time for economic reasons, as a percent of the civilian labor force plus all marginally attached workers."

So 10% includes people who are employed in part time work and people who aren't even looking for work, but would like to work if someone would be so kind as to find them and present them with a job that meets their satisfaction. Sorry, but I am currently employed "part-time" and not only do I consider myself employed, but I'm also making more money now than I ever did working full time. And furthermore, if you say you want a job, but aren't willing to go out and look for one, I'm not wasting a whole lot of tears on you. I'll stick to the 6.1% number.

[Starwind]

Sorry, but I am currently employed "part-time" and not only do I consider myself employed, but I'm also making more money now than I ever did working full time.

Yes, but presumably you are not looking for a job.

The criteria is not simply part-time, but previously employed full-time, now part-time (for economic reasons) and earning less than before, but still looking to return to a full-time job at comparable wages. These are, for example, former manufacturing people now waiting tables at lunch time and dinner time.

I'll stick to the 6.1% number.

So does much of the media and the government. The chart below uses the 'Establishment Survey' employment data (I believe):

[oceanview]

the full jobs report for September comes out Friday. Its the only report that matters for Bush. If it starts to show jobs LOSSES from 0-20,000, that is actually good news, since its been running near 40,000 per month, a loss of 20,000 might be a turn (as perverse as this sounds).

None of these employment figures show what we all know is really happening; massive job loss to offshoring in manufacturing, tech, white collar, etc.

[1rudeboy]

Beware the "underemployment" figure, as it includes those who willingly forego higher wages for more time with the kids, etc.

[1rudeboy]

Further, the unemployment rate you cite actually counts only those people who receive unemployment benefits. Once their benefits expire (after 13 or 26-28 weeks) they are no longer included in the 6.1% unemployment rate you cite, even if they do not have a job.

My understanding is that the operative factor is whether one is looking for a job, not collecting unemployment benefits.

[Starwind]

Beware the "underemployment" figure, as it includes those who willingly forego higher wages for more time with the kids, etc.

Could you elaborate please on how 'willingly' employed (or not) gets translated to 'under' or 'un' employed? Unless the respondent lies, how does this get past the survey questions, and then what is their motivation to lie when they're 'willingly' content with their circumstances?