Rep. James Smith, Mayor Steve Benjamin and Councilwoman Tameika Devine gathered at Main and Gervais today to celebrate the latest employment figures.
Here’s a quote from the release that summoned me to the windswept presser (sorry about the sound quality):
When the President took office, we were losing more than 700,000 jobs a month. The economy was spiraling out of control, and the economic security of millions of middle-class Americans was vanishing. Now, the private sector has added more than 3.7 million jobs, the American auto industry and the more than 1.4 million jobs it supports were saved, and manufacturing is creating jobs for the first time since the 1990s. But the President didn’t just address the immediate crisis and stop there. He began to lay a foundation for a stronger economy across the country so such a collapse can never happen again.
This is a make-or-break moment for the middle class, and we have a lot more to do if we’re going to continue the trend we’ve seen for the last two years. That’s why the President has outlined a vision for an America built to last. It’s a blueprint based on American manufacturing, American energy, skills for American workers and a renewal of the American values that made our nation’s middle class the envy of the world – values like fairness and opportunity.
Mitt Romney and Republicans in South Carolina don’t share this vision. He doesn’t think we should invest in our workers, our students or American industries like carmakers and clean energy. He doesn’t think that we should be rewarding companies only when they bring jobs back to states all across the country, not when they send them overseas. And just as baffling, Romney and the Republicans don’t even admit that this reversal and recovery is happening.
Today, Democrats are embracing the fact that in January, unemployment plummeted to its lowest point in three years. Here’s a copy of the chart they’re standing next to. Meanwhile, some of their detractors are saying that a record number of people dropped out of the workforce that same month.
So I guess you pick the stats of your choice, according to your predilections.
For my part, I told James after the event, all I know is that Obama was inaugurated, and six weeks later, I was laid off. I guess that makes me a tough audience. 😉
But seriously, folks, whoever can claim credit, I’m glad to see promising signs, and look forward to when everybody’s doing as well as they did before 2008.
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It’s been a long time since I’ve seen a labor report that was so unambiguously good news. Nearly 1/4 million jobs created enough to drop the unemployment rate to 8.3% despite an enlarged labor force. For the last 2 years all we’ve heard from the GOP is how Obama made the recession worse. Can’t even say that now. Still, 8.3% is a very high number which could head back up with any bad news from Europe or Iranian mischeif in the straight of Hormuz. But for now let’s toast the good news and laugh heartily at the ridiculous claims that Mitt, Newt, Boehner, Mitch and the other Republicans will make that suggests you shouldn’t believe what your lying eyes are telling you.
Courtesy of Shira Kramer of the Obama campaign, here are the prepared remarks from the mayor and representative:
By the way, the single source (Tyler Durden… does that name make you wonder?) cited by Drudge and Adam Baldwin in trying to find bad news in the numbers is debunked in this piece.
They talk about unemployment numbers dropping, but where are these jobs that are supposedly hiring thousands of people each month? That’s what they don’t or can’t tell you.
Unemployment is one thing, how do the underemployment numbers look? Does one really need a master’s degree to work at Starbucks or tend bar in the Vista?
I’m not saying that the drop in the BLS’s unemployment estimate is a bad thing, in fact it’s welcome news. I just don’t trust the BLS to report unemployment truthfully at all. They’ve been cooking the books for a long time.
The CPS numbers are based on a survey of 50k households. During the Clinton administration they kicked a bunch of the long term unemployed out of the count, and reduced the number of sampled households from 60k to 50k, and eliminated much of the sampling from the inner cities. That’s just one example.
The real unemployment rate hasn’t been under 10% in years – maybe decades. The best measure of unemployment, the U6 is somewhere around the same level it was in 1930-1932.
If you really wanted to get rid of unemployment, you’d make massive cuts to welfare and unemployment insurance programs, get rid of the minimum wage and union work rules/rates. Presto – everyone goes back to work.
http://www.econlib.org/library/Enc/Unemployment.html
“It’s been a long time since I’ve seen a labor report that was so unambiguously good news.” – bud
You still have not heard any unambiguously good labor news:
BLS statistics (see “Labor Force Participation” chart here: http://www.zerohedge.com/news/record-12-million-people-fall-out-labor-force-one-month-labor-force-participation-rate-tumbles-
People not in the labor force exploded by an unprecedented record 1.2 million. Not a typo: 1.2 million people dropped out of the labor force in one month.
The civilian labor force tumbled to a fresh 30 year low of 63.7% as the BLS is seriously planning on eliminating nearly half of the available labor pool from the unemployment calculation. As for the quality of jobs, the US is replacing high paying ‘FIRE’ jobs with low paying construction and manufacturing. So much for the unambiguous improvement.
A quick sanity test in our capitol area should corroborate the latest Obama improvement fallacy: what is the current rate at which 2011 USC graduates have landed career (non blue collar) building employment versus the 2010 level?
With your IT skills, maybe you can find the answers.
Man I guess Steve Benjamin is just chomping at the bit for Clyburn to fade away so he can get that Congressional seat. But tying the revitilization of Columbia’s Main Street to President Obama? And don’t these three rising stars look rather small standing on a street corner touting how great the economy supposedly is – thanks to a president that is not exactly popular with the political culture of our state and who isn’t going to be making a play for our electoral votes anyway?
Rather quixotic, eh?
Where is the crowd?
@Juan
As a parent of a 2010 graduate who still has not found a job, I can tell you the job market is terrible for them. Part of that is due to the fact that employers no longer want to take graduates with no real experience and spend money to train them to actually be productive. Then there is the overflow of out of work professionals competing for the same jobs. My son tells me that very few of his fellow graduates have jobs — well, there is the guy who spent $80K on his USC education and is waiting tables at Ruth’s Chris.
@Juan, you didn’t follow Brad’s link that shows that the zerohedge analysis is wrong. Here’s another link, which also shows what the numbers are adjusted for the population change: http://www.calculatedriskblog.com/2012/02/employment-not-in-labor-force-actually.html.
Gingrich stated on Meet the Press this morning that labor statistics don’t state the people who have given up (puts the unemployment rate up around 11-12%) or the people who are working part-time (putting the unemployment up around 14-15%.
I’m assuming that a presidential candidate would have his facts checked and double-checked before stating statistics like that. On one hand you have a president who needs good news to stay in office and a drunk driving mayor of a medium sized city to back him up.
Doug – Anyone who spends $80k on an education at USC has other issues.
@Bart – Tells you how many people in Columbia really care what these three have to say. Who was there besides Brad and his iPhone?
Bud, Newton Leroy just said we need pro-growth policies not austerity programs!
Let’s hope they we might rebuild the US rather than having another war. The Iran response, if the Israelis strike, will be one hellva mess for us all. Unfortunately, “Keep in mind, World War II was a lot of things. Among them, it was the mother of all government-spending stimulus “programs. The Keynesisans were right.” Let’s hope war is not his pro-growth plan.
In answer to Steven’s question, I’ve posted a photo at the bottom of the original post. There were three or four TV cameras (a little hard to count at this angle).
These things are staged for TV. Otherwise, they could just email what they have to say — as Shira did in sending me those remarks.
I very seldom go to these things. I just happened to call up the email about this one right at 2:30, realized, “That’s now, and three blocks away.” So, it being a nice day, I walked over. I missed what Tameika said, arrived in the middle of Steve, and caught all of James’ — which you see above.
This is just political grandstanding, just like SC Governot Nikki Haley took credit for the decrease in unemployed South Carolina citizens, only to see the unemployment rate rise the next month. That’s a “Whoops!” moment for SC Governot Nikki Haley, “Hey, I’ll blame that mean ol’ Obama and the NLRB for the increase in unemployment.”
Doug Ross, thank you for making my argument which USC and Clemson can certainly support.
Susan G, Brad, and bud, please get a clue about the flow of propaganda from political allies. As I have clearly stated twice now, “A quick sanity test in our capitol area should corroborate the latest Obama improvement fallacy: what is the current rate at which 2011 USC graduates have landed career (non blue collar) building employment versus the 2010 level?”
Why have you not pursued that answer, Brad? (Excuse me, you probably have pursued it, but have been stonewalled, right?)
Juan, don’t know what source you’re citing but the BLS report clearly shows the labor force is NOT contracting. This is a very good labor report showing improvements in all non-government sectors. Here’s the relevant paragraph:
“After accounting for the annual adjustments to the population controls, the employment-population
ratio (58.5 percent) rose in January, while the civilian labor force participation rate held at 63.7 percent. “
Juan, what the heck is “a quick test in our capitol area”? And I’m afraid that if I compare my level of trust of the analysis at CalculatedRisk versus ZeroHedge, ZeroHedge loses in a big way.
I didn’t say we don’t have an unemployment problem, and an underemployment problem. Obviously we do — no one is saying the problem is solved, or that’s it’s not still a bad problem. It’s also well known that the unemployment rate among young people coming out of college is especially high, so you’re question about 2011 grads not getting jobs does not prove anything about the overall unemployment rate easing slightly over the last few months.
I was just pointing out (as Brad had already done) that you quoted an article that said that we lost 1.2 million people from the workforce in one month, which we did not.
Part of the problem with the decline in main stream media is that alternative news sources do not feel obligated to use sources accurately, or at the very least, lack the knowledge base to accurately discuss facts.
The other side of the coin is that we, as consumers of alternative news sources, need to develop the critical thinking ability to analyze presented facts with proper skepticism regardless of our ideaology.
I am getting sick of the “I saw it on the tv/internet so it must be true, right?”.
If you really wanted to get rid of unemployment, you’d make massive cuts to welfare and unemployment insurance programs, get rid of the minimum wage and union work rules/rates. Presto – everyone goes back to work.
-Silence
I understand that folks on the right really, really hate unemployment insurance. Plus, they despise labor unions and the minimum wage and everything else they perceive as “socialism”. It’s an article of faith to attack these things with as much stridency as they can. Perhaps there’s some shock value or some other psuedo debating points they are trying to score. Whatever the reason I get it.
Given this enormous cultural divide where do we go from here? Obviously there’s little in the way of compromise. The only possible outcome is for one side or the other to win the support of the mushy middle that can be swayed. Then the winner just needs to ignore the losing side with all the predictable complaining and natering that will inevitably follow. This is why I don’t find it particularly useful to attempt to work with the other side in a bipartisan fashion. In today’s political environment it just won’t work. How can I find common ground with someone who earnestly believes we should abolish the minimum wage? It can’t be done, the gap is too wide. And that is a truth that those who cry out for bipartisan solutions just need to understand.
“…you quoted an article that said that we lost 1.2 million people from the workforce in one month, which we did not.”
Are you saying the BLS’s January ‘Labor Force Participation’ chart is in error or have just not consulted it because you subscribe to the fallacy that a cumulative adjustment should be discounted because it represents corrections of more than one month?
Sorry, none of the above is defensible. The loss of 1.2 million people from the workforce, suddenly reported in one month, inflates the economic improvement because it reduces the denominator of the participation statistic.
You would probably be surprised how many corporations use BLS statistics monthly and employ people trained to interpret them accurately. In other words, all of the people are not being fooled.
what bud said.
Are you saying the BLS’s January ‘Labor Force Participation’ chart is in error …?
-Juan
No, I’m saying YOU are in error. The BLS report does not show a reduction the labor participation rate. It does reflect a change in methodology which, while increasing long-term accuracy, will indicate a lower participation rate if viewed out of context. The report was released with an explaination of this and it’s clear what it means. ALL the other numbers show a modestly, and yes, unambiguisly improving job situation. Spin it all you like but the report is good news, period.
@ Bud/Kathryn – I realize that at this point it is unrealistic to “abolish the minimum wage” but by failing to do so we have decided that we are willing to acccept some persistend level of unemployment.
If the marginal benefit of adding an additional employee doesn’t exceed the marginal cost of adding one, you can’t exepect someone to get hired. Ergo, if someone isn’t worth $7.25/hour to a (any) company, they will just be sitting at home and watching daytime TV, or sleeping in a cardboard box somewhere.
“persistent” not “persistend”
@Juan,
No, I’m not saying the numbers are in error, and no, I’m not subscribing to some fallacy. I understand the difficulties with the BLS numbers and how they’re reported as well (as well as other metrics that are often used instead). Understanding how their reported informs how we interpret them, and therein is where I think you’re wrong.
What you said above was “1.2 million people dropped out of the labor force in one month”. That just didn’t happen. You seem to know that it was a change in the Census used for population numbers, and you seem to know that the change didn’t actually happen all in one month. That would be cause for much greater alarm than the reality of the situation.
So to determine month-over-month trending data, we take out the adjustment. To look at absolute data, we keep them in. The trend is positive, but the labor participation rate and employment-population ratio is slightly lower than was thought previously.
3-4 Million Boomers hit 65 every year. Venture to guess most of them will retire, maybe at best taking on part time jobs, or volunteer work. Most of those folks will probably take their retirements around every years’ end.
Agreed, Silence. However, you are assuming a perfect free market, or at least one where there is a lot more information out there and a lot more careful calibration of hiring decision by companies. A lot of companies seem to do stock=price enhancing layoffs that have nothing to do with running their core business.
Been in a KMart lately? I might have bought things there, but they have cut their core business so close to the bone that there is no one to stock/straighten the shelves ad few people to check out. Anyone who shops at Walmart has seen abandoned shopping carts full of unpurchased merchandise because the shoppers could not wait for the next available cashier.
Silence, I understand the theory behind why a minimum wage increases the unemployment rate. It’s just not quite so simple in the real world. What is not considered is the real-world situation where a business, by necessity, has to maintain a certain staffing level in order to function. What an employer is dealing with is not some sliding scale that equates marginal cost with marginal benefits but rather a two-tiered minimum wage. The bottom tier reflects the absolute lowest wage the business owner can pay to attract the necessary labor to run the business. The upper tier is what he will pay, at most, to hire the same staffing level up to the point he simply goes out of business. The lower tier may be very low indeed during a recession since many folks are competing for few jobs.
During a serious economic boom the lower tier may be higher and perhaps even higher than a government minimum wage. It could even approach the upper tier wage. If the business in question does not increase business in relation to the overall improvement in the economy it could become difficult for a business to keep going. On the other hand if the business increases sales substantially wages will rise as new workers are needed and a higher wage is needed to compete for workers.
This is all very complicated with many caveats but clearly a governmnent minimum wage will not have the dire impact it’s detractors say it does. Businesses need workers and will pay them less if they can get away with it. Either government or unions are essential to establishing countervailing power to a world increasingly controlled by corporate elites with significant monopoly power. If the GOP has it’s way neither of those two forces will be available to look out for workers. And wages will suffer along with another round of income inequality.
Tim cites part of a true and expected dynamic, but what many miss are missing is haunting:
While the non-institutional population declined, those working declined even more and those no longer counted in the labor force increased as well.
People are dropping out of the labor force due to not being able to find a job, and they are no longer being counted.
We cannot blame an aging population or education on the DECLINING labor participation rates for those between 25 and 54 years of age.
@ Kathryn – Sears/KMart in particular is in the throes of “creative destruction”. It’s sort of the General Motors of retailers.
I agree completely about the stock price enhancing layoff – Companies that make decisions based on the market’s perception of their common stock are not acting as good stewards of capital for their long-term shareholders, and will ultimately find that there is a price to pay. Companies that ignore the quoted share price/market valuation and focus on making money are doing the right thing. There’s both kinds of layoffs though, needed and totally unnecessary, for sure. The only companies worth owning are the ones where management and shareholder interests are aligned.
That being said, I think the minimum wage generally eff’s things up that would be best left ot market forces.
There’s only a few teenagers left in my neighborhood…. now I choose to mow my own lawn.
Unemployment figures going down and employment figures going up is always a good thing. The fact that some take issue with the statistics and methodology is as Brad said, based on your predilections. Naturally, there will always be disagreements and different takes on the figures.
The claim made by one side that 1.2 million people dropped off the roles in one month is accurate but not true. The adjustment was made based on the results of the 2010 census figures and accounted for by the BLS. It was a number based on the last census and incorporated into their most recent two month adjustment. According to the BLS, “Those not classified as employed or unemployed are not in the labor force.” There were no questions relating to employment or unemployment on the census forms so any information gleaned from the forms was used to adjust the numbers, a traditional statistical analysis model was used to run them along with their standard survey participants used several times a year.
Therein lies the one of issues that goes direct to the heart and truth of the matter. According to the BLS, the 1.7 million people who make up the number of people available for the work force vs. people actually in the work force was determined by using two age group demographics. The 16-24 group to a lesser degree but the 55 and older to a greater degree since past statistics have shown “both age groups have lower levels of labor participation than the general population.”
The actual adjusted number is 1,510,000 according to the BLS site. Of this number, the estimated size of the civilian labor force was adjusted to 216,000 employed and 42,000 unemployed, leaving 1,252,000 not accounted for in the labor force.
It is apparent that the BLS did not account for nor did they make adjustments in their statistical modeling since the downturn to account for the high number of people over 55 who have re-entered the work force due to losing their jobs, losing retirement benefits, having to take a second job to make ends meet plus all of the other unpleasant results of the continuing financial crisis we are experiencing.
As for the 16-24 age group, one other adjustment not accounted for by the BLS. This particular demographic, before the downturn, traditionally were high school and college students. They were not as active in the available work force because their contributions to their own financial needs and to their family’s needs were not required as much as they are now.
As a general rule, the models used by the BLS are fairly accurate or as accurate as it can be considering the size of the population, diversity of information sources, and reliability. However, when circumstances are not within the normal range, adjustments to models and analysis mathematics should be made to account for the changes. The downturn we are in is as close to the Great Depression as anything ever we have experienced in our lifetime and does have a significant impact on the traditional means and methods.
I do not “live and breathe statistics”, so my take on it is my attempt to make sense of what is another political strawman used for political gain by both sides with the truth being the ultimate victim.
Neither side can claim the high ground on this one. You can agree or not, your choice. In the words of Rhett Butler, “Frankly, my dear, I don’t give a damn.”
Sorry for the grammatical errors. Had to do a few edits and missed a few.
The only companies worth owning are the ones where management and shareholder interests are aligned.
-Silence
I would never own stock in a company that didn’t look after (1) it’s customers (2) the nation as a whole, including environmental and safety issues and (3) it’s workers. The bottom line is the bottom line but if that’s all there is then count me out.
Shareholders are not what they used to be — buy-and-hold or employee stock ownership plans — the extreme shortsightedness of the modern institutional investors and arbitrageurs is wreaking havoc on our employment, the environment, etc.
I think we have a problem with corporate governance. Corporate boards are piled up with glam names that look nice on an annual report, but are really just puffed up folks like celeb’s, College presidents, etc., who willingly follow whatever the management team says, and who are paid to play, while voting for whatever compensation package the exec’s say they need.
@ Kathryn – agreed.
@ Tim – agreed.
@ bud – disagreed.
Silence, by disagreeing does that mean you’d willingly own stock in a company with a history of polluting the environment, I.E. BP? Or one that flaunts safey regulations that help keep workers safe? Some mining companies are guilty of that. Or that simply have no respect for their customers?
Bart, nobody has a greater respect for the truth than I do and certainly any flaws in the BLS statistics are fair game for pointing out. But the BLS statistics when considered with ALL the other statistics paint a pretty robust picture of an economy that is slowly improving.
While liberals may sometimes bend statistics to support their cause above and beyond what is actually the case they can’t hold a candle to the unbelievable spin the far right puts on any evidence that refutes their cause.
Just check out some discussions about global warming. There is far more evidence to support the theory that man-made emmissions of CO2 and other gases is warming the atmosphere than evidence to the contrary. But does that stop people from spinning the evidence to reject global warming theory?
Just to be sure of one point before proceeding.
@bud, aren’t you a state employee and if so, are you vested in the state employees retirement plan? If not, ignore the comments that follow.
If you are, then let us know if you investigated every company that is part of the vast portfolio of investments for the retirement fund and if you approve of each and every one.
“I would never own stock in a company that didn’t look after (1) it’s customers (2) the nation as a whole, including environmental and safety issues and (3) it’s workers. The bottom line is the bottom line but if that’s all there is then count me out.”
If you are a South Carolina state employee and participate in the retirement plan, by fiat, you own or invest in a wide variety of available opportunities.
The allocation of funds for investment of collected state pension fund contributions covers the entire spectrum of the stock, bond, futures, hedge funds, credit default swaps, private equity, commingled funds, and almost every other possible investment opportunity available on the market.
Did you investigate the 60 plus firms that handle the investments for the state retirement fund? Did you determine if any of the companies included in their portfolios were guilty of the violations you listed as deal killers for you? If so, do you have the option to opt out of having any of your deductions invested in the guilty companies?
Are there state guidelines for companies handling or investing the funds entrusted to them to cover the problems you listed?
If it was determined that one of the companies was guilty of polluting the environment, flaunting safety regulations, or has no respect for their customers, would you could you pull your money out of the retirement fund?
Just wondering since you are so adamant and steadfast in your position.
I agree with Kathryn, shareholders are not what they used to be.
Bart, Honestly I don’t know the answer to your question about how the pension money is invested. Until fairly recently there was investments in the stock market since it was regarded as risky. No I can’t opt out nor as a practical matter would I since I have to have retirement income to fall back on. So in that sense I suppose I’ve been busted. Hopefully (and that is certainly pollyanish) the state invests in companies that are good stewards of the environment and treat their employees and customers well. As both a state worker and a citizen of the state that is certainly something to consider when we hire investment managers to make these decisions. If we were to do so then we could leverage that into a position of power whereby firms would have an incentive to act accordingly.
But as far as personal investments I stand by what I said.
should be: were NO investments in the stock market …
@ bud – As a matter of fact, I do own American Depository Shares of British Petroleum, and they were good enough to increase their dividend today!
A company (or their board & management) has a fiduciary duty to the shareholders. Now generally, it is not in the long term interests of a company to pollute the environment, abuse their workers, or stick it to their customers. While these tactics may help juice short term profits, over the long run they are a recipe for disaster!
Companies have a duty to obey all of the applicable laws and regulations, and to compensate their workers per their employment contracts. If they are dumb enough to screw over their customers… the customers probably won’t stick around for long.
@ Kathryn – I agree. I’d like to see short term capital gains taxed at a higher rate, say 90% in the first year and dropping to 0% in 10 year’s time.
It wouldn’t matter if you took off the glam names–it’s still a good old boys club, and despite tons of evidence that it’s better for the company, shareholders and the public, the incestuousness of corporate boards continues, because no one who can really do anything about it wants to.
PS–bud–it’s “flout”–to disregard. To “flaunt” is to show off.
@bud,
Thanks for the reply. Was not trying to bust you but to point out the things that we must put up with in our daily lives when if given a choice, we would opt out of.
On the for what its worth side of the issue, I agree with your list overall and wish that the operating model for every corporation was to be the very best corporate citizen it can be.
After working in a diverse number of industrial, chemical, petroleum, and pharmacutical plants across the country, I have found that most are always trying to do what is right and they do work hard to be a good neighbor and corporation to benefit their employees and stockholders
@bud
I’d be interested in seeing the names of a few companies that would fit your criteria…
Are you telling me you wouldn’t invest in safe dividend paying stocks like Duke Energy, Coca Cola, Wal Mart, Pfizer?
@bud,
Just to let you know I agree with the recession being over, I read one important bit of information in the hiring for new jobs. One of the key elements of the report was that a large percentage, didn’t say what it was, was in the architect, engineer, and accountant fields. When this sign appears in hiring, it means that companies, corporations, and industry are in the process of initiating new projects for construction which means expansion, which means more employment, and in general growth is actually in a positive mode.
Until I saw this sign, there was no way I would agree that the recession was either ending or had ended.
The problem for the immediate future is that until the projects are off the board and under construction will the impact be felt with any real significant numbers. Depending on the type of projects and planned opening dates, unemployment will remain in the 8% plus range.
I could care less who is in the White House, every recession comes to an end. Ultimately, it is the people of this country, business owners and employees alike who impact growth, not politicians or presidents.
Unless this is an anomoly in the figures, it is a darn good sign.