- A Scary Reality
By BOB HERBERT
Published: August 10, 2009
Last week was a pretty good one for President Obama. Bill Clinton helped out big time when he returned from North Korea with the American journalists Laura Ling and Euna Lee. Sonia Sotomayor was elevated to the Supreme Court. And Friday’s unemployment report registered a tiny downward tick in the jobless rate.
But for American workers peering anxiously through their family portholes, the economic ship is still sinking. You can put whatever kind of gloss you want on last week’s jobs numbers, but the truth is that while they may have been a bit better than most economists were expecting, they were still bad, bad, bad.
Some 247,000 jobs were lost in July, a number that under ordinary circumstances would send a shudder through the country. It was the smallest monthly loss of jobs since last summer. And for that reason, it was seen as a hopeful sign. The official monthly unemployment rate ticked down from 9.5 percent to 9.4 percent.
But behind the official numbers is a scary story that illustrates the single biggest challenge facing the United States today. The American economy does not seem able to provide enough jobs — and nowhere near enough good jobs — to maintain the standard of living that most Americans have come to expect.
The country has lost a crippling 6.7 million jobs since the Great Recession began in December 2007. No one is predicting a recovery in the foreseeable future powerful enough to replace the millions of jobs that have vanished in this historic downturn.
Analysts at the Economic Policy Institute noted that the economy has fewer jobs now than it had in 2000, “even though the labor force has grown by around 12 million workers since then.”
Two issues that absolutely undermine any rosy assessment of last week’s employment report are the swelling ranks of the long-term unemployed and the crushing levels of joblessness among young Americans. More than five million workers — about a third of the unemployed — have been jobless for more than six months. That’s the highest number recorded since accurate records have been kept.
For those concerned with the economic viability of the American family going forward, the plight of young workers, especially young men, is particularly frightening. The percentage of young American men who are actually working is the lowest it has been in the 61 years of record-keeping, according to the Center for Labor Market Studies at Northeastern University in Boston.
Only 65 of every 100 men aged 20 through 24 years old were working on any given day in the first six months of this year. In the age group 25 through 34 years old, traditionally a prime age range for getting married and starting a family, just 81 of 100 men were employed.
For male teenagers, the numbers were disastrous: only 28 of every 100 males were employed in the 16- through 19-year-old age group. For minority teenagers, forget about it. The numbers are beyond scary; they’re catastrophic.
This should be the biggest story in the United States. When joblessness reaches these kinds of extremes, it doesn’t just damage individual families; it corrodes entire communities, fosters a sense of hopelessness and leads to disorder.
The unemployment that has wrought such devastation in black communities for decades is now being experienced by a much wider swath of the population. We’ve been in deep denial about this. Way back in March 2007, when the official unemployment rate was a wildly deceptive 4.5 percent and the Bush crowd was crowing about the alleged strength of the economy, I wrote:
“People can howl all they want about how well the economy is doing. The simple truth is that millions of ordinary American workers are in an employment bind. Steady jobs with good benefits are going the way of Ozzie and Harriet. Young workers, especially, are hurting, which diminishes the prospects for the American family. And blacks, particularly black males, are in a deep danger zone.”
The official jobless rate is now more than twice as high — 9.4 percent — and even more wildly deceptive. It ticked down by 0.1 percent last month not because more people found jobs, but because 450,000 people withdrew from the labor market. They stopped looking, so they weren’t counted as unemployed.
A truer picture of the employment crisis emerges when you combine the number of people who are officially counted as jobless with those who are working part time because they can’t find full-time work and those in the so-called labor market reserve — people who are not actively looking for work (because they have become discouraged, for example) but would take a job if one became available.
The tally from those three categories is a mind-boggling 30 million Americans — 19 percent of the overall work force.
This is, by far, the nation’s biggest problem and should be its No. 1 priority.
The media had been focusing on the rate of decline had slowed. Less jobs were lost. So this is the signal that the worst is over.
But as most would like to point out some 247 thousand lost in July.
Mind you that's one month.
And how many jobs were lost since Dec 2007?
6.7 million!!
Yeah, and thanks to the money printing press, global markets flew up, up and away. No it's not a birdie, it's no plane but it's helicopter Ben and helicopter Wen!
Some are calling it already Stocks: The latest Fed bubble
- NEW YORK (Fortune) -- The Federal Reserve has spent the past year cleaning up after a housing bubble it helped create. But along the way it may have pumped up another bubble, this time in stocks.
To head off the worst downturn since the Great Depression, the central bank has slashed interest rates while funneling money to banks.
The Fed has mostly won praise for its efforts. The pace of job losses has slowed, and there has been a modest recovery in output.
At the same time, stocks have bounced back with startling speed. Since global markets hit their bottom in March, the S&P 500 has jumped 51% -- even as the outlook for economic recovery remains dim.
"This is the most speculative momentum-driven equity market since the early 1930s," Gluskin Sheff economist David Rosenberg wrote in a note to clients Monday......
And many stocks flew insanely to the stars!
Yeah many are cheering that young bulls don't die young! lol
When a stock can increase 33.3% after reporting earnings out of which 96% of it came came a tax credit! Minus out the tax credit and you are talking about pre-tax profit of a mere 248 thousand!
Watch out.
Insanity is surely back in stocks!
LOL!
Of course those who are still in the market won't like what I am saying. For them, market is up and they are making money and they surely can make do without this voice.
LOL!
ps: have you seen what the Baltic indexes are suggesting?
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