For the second time in monthly jobs report history we have created no new jobs. The last time we created no jobs in a month was 1945. We saw downward revisions to the June and July 2011 numbers as well; erasing 56,000 previously reported job gains. Local government employment continued to fall, losing 20,000 jobs in August. Of the local job losses 13,700 were in education. We have now lost 550,000 local public sector jobs over the last 3 years. The broad U-6 measure of unemployment rose to 16.2% in August. This measure includes people who have stopped looking and who are involuntarily part time.
We continue to see consistent and large job losses at the local government level. We have now seen this for many, many months. It is particularly alarming to see cuts remain concentrated among those who work in public schools. We know this is not beneficial for the 85% of American students who go to public schools. In an increasingly competitive global economy, large and continuous disinvestment in basic public education is highly problematic. It would be hard to imagine a worse way to cut public spending and service provision.
Productivity has been strong during the great recession and "recovery" over the last 3 years. Productivity gains have been significant and have gone, nearly entirely, to profits. The most recent data, 2Q2011, productivity declines are not shocking in the context of recent growth. We are seeing compensation rise more than hourly output. The rapid recent increases in consumer prices, especially food and energy, suggest that some increase in hourly compensation was overdue and necessary. It remains true that productivity has surged over the last few years and nearly all the gains have gone to private sector profitability. Compensation has been flat and unit labor costs, until the latest data, were falling as productivity increased much faster than wages.
Summer 2011 saw the highest youth unemployment rate ever reported in the over 6 decades of numbers that we have. The BLS counts people 16-24 years old as youth. The April to July 2011 youth employment to population ratio was under 50%, 48.8%. We saw 18% youth unemployment this summer with 30% for African American youth. This bodes poorly for the future and highlights the disproportionate negative effect that the recent economy has exerted the young.
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Technology is replacing human labor in the job place.. This is going to continue.. that is why productivity is through the roof and yet, the number of jobs is still shrinking. It won't stop. In the coming years we will see unemployment at or over 50% of the population.. how will we keep our economy going with that high permanent unemployment?
Economists will not consider this possibility as it runs counter to what they learned in school. Politicians will not consider this possibility because it means they will have to reinvent the economy... That does not stop it from happening.
http://www.youtube.com/watch?v=csa459eSZr8
Time to return power to the states. The federal government has no business being involved in education, wasting gabillions of dollars throwing good money after bad for decades now. And states can no longer afford to shower public servants with golden health care and retirement packages. The era of Kumbaya liberalism is over.
Overall, the quality of education judged by other nationally normed tests and college entrance exams has not improved since the Federal Dept. of Education took over. They don't justify their own expense.
On a sad note about financial local public school, the MERS cloud land title and subprime lending on residences put the school tax base at risk. Property taxes are the foundation for school funds in most places. Mortgage originators, bundle-bad-loan banksters, AAA-for-toxic rating agencies, foreclosure mills, robosigners, etc., don't care about school funding.
It would take many trillion dollars to provide jobs for all over several years. Would the Chinese lend us the money?
Pres. Obama has this hot potato in his hands as he prepares his speech for next Thursday.
The Republicans want to cut government spending when 20 million workers are unemployed and are hardly spending. The middle class isn't spending as much because of the decline in housing values. The trade deficit is draining over half a trillion a year from the US economy. If the government doesn't replace the dollars that business expect to purchase items the businesses cut back or go out of business and things are worse.
Fixing the problem the US is in is going to take a lot of work, big laws need creating or changing and I wonder if the Dems/Reps even want to make big changes.
We need to get the factories that make the products we like back from overseas or replacements built in the US.
The creation of money needs to be placed back into the Treasury instead of the banks. The bank stop creating money(credit) at the times we need it most, when we are heading in to or in a recession.
The Republicans offer balancing the budget which is what Hoover did in 1932 and that didn't help one bit.
The Democrats are suggesting more stimulus but the factories that would rehire workers were moved offshore.
Maybe the Green's have some ideas.
China has accumulated enough dollars to buy all the US farmland if they buy it slowly.
How about manufacturing solar panels? Oh, wait... http://www.washingtonpost.com/blogs/right-turn/post/obamas-not-at-all-green-thumb/2011/03/29/gIQA9lWuuJ_blog.html