Jobless agonistes

I certainly hope that the GOP ultimately nominates a reasonably sane presidential candidate. If history is any guide (and I suspect it is; the electorate's views on race may have changed in the last 40 years, but I doubt they have on being unemployed) then even Ms. Palin or Ms. Bachmann could beat Obama in this environment. Shudder.

"The best explanation for the sharp slowdown in the jobs market is the confluence of bad luck that hit the economy this spring"-really? So it's a case of bad "luck" and not bad policy decisions that have resulted in the country's economic weakness? I think luck has very little to do with it. More like a failure of leadership from a political class that is more concerned with the country's long-term debt problem than it's very present catastrophic unemployment problem. It's a matter of priorities, not luck.

Wait a minute. From a conservative perspective, this is the best report ever: Private employment up by 57k, government employment down by 39k. Government is shrinking and the private sector is still expanding. The job growth is nothing spectacular but it wasn't under GWBush either. Conservatives will see this as a reason to keep pressing on with cutting government: "See, the private sector is expanding so we need to keep reducing the size of government because then the private sector will boom." Conservatives will also see this report as a club to hit Obama with, so it really is a cause for them to celebrate.

The best explanation for the sharp slowdown in the jobs market is the confluence of bad luck that hit the economy this spring: a sharp increase in petrol prices, a series of natural disasters, and the Japanese tsunami and earthquake that interrupted supply chains in electronics, automobiles and other industries.

Sorry, but Consumption in real terms is the highest ever!

Companies aren't building structures, nor hiring.

In all likelihood, the employment data will improve in coming months as consumer purchasing power and business spirits recover from the fuel price surge.

July will be nice. Minnesota laying of 20,000 for the shutdown.
A new fiscal year for state budgets - more layoffs.

The payroll tax better not expire in January, else that is a tax hike! (right Ayatollah Norquist?)
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So what you are saying is that we tried Keynes - stimulus.
We tried Friedman - QE1 & QE2

And both failed.

Regards

Things will get better

While the American unemployment situation appears to be poor at best, research shows that over the past decade, the unemployment and labour underutlilization situation among young Americans between the ages of 16 and 29 has grown steadily worse. As shown here, labour underutilization among non-White Americans is particularly grim, reaching as high as 43 percent:

http://viableopposition.blogspot.com/2011/04/americas-youth-labour-issue...

The bad luck argument always hits my ears in the same way as a football supporter talking about all the 'buts' and 'ifs' after his team loses a game.

I think the risk of the government front-loading austerity are low enough not even to require a contingency plan.

I agree, Shubrook. Here are some other things ringing false at this point:
1) The FED could do more to expand unemployment.
2) We need a major fiscal stimulus.
3) You can't raise taxes in this economy.

One of the things I remember from macro 201 is how the history of 20th century economic theory seemed to be one in which each new model was designed to explain the failure of the previous one. So, I propose, as the new model, Doug's Law of Limitations: If you're hurt enough, there ain't nothing for it but to heal.

I still think the FED can affect growth and fiscal policy can affect growth, but the law of diminishing marginal returns obviously applies to macroeconomic interventions as much as to utility curves and production functions.

"The household survey is less reliable but is still a useful check. It tells us the payroll report is not understating the strength of the job market."

It also includes the "self employed" whereas payroll employment does not. Lots of U.S. firms have turned their workers into "independent contractors." At what point is an independent contractor or freelancer unemployed? When they haven't had contracts for a week? A month? I guess it depends on what they tell the BLS.

The FED and fiscal policy can affect growth, the question is at what cost. At what point is intervention too much? Is the FED really addressing the problem or just delaying the inevitable? I still think the housing market is a major player, underwater homes are still on bank asset sheets and many home owners are still on a path to foreclosure. Perhaps we are paying the price that we should pay a long time ago and there is nothing we can do. Long wars have a price. Perhaps economic growth cannot get us out of this and we are simply on an economic correction that should had happen gradually but was masked by the housing bubble.

The real reason for Joblessness is outsourcing and careless spending on wars that you cannot win. The world does not need to be saved by US alone and nobody wants us to be there anyways. We have spent trillions in wars and what do we have?...all we have is more deficit and we are about to default on our debt. Instead if we spent the same dollars on energy(fossil+green) we could have been way close to being energy independent! and taught a lesson to the so called OPEC countries who are bunch of thugs controlling the price of gasoline and harboring terrorists in their back yard.

And what do we get for outsourcing? rampant job loss and competitiveness of US is goign down. As Indians and Chinese steal all secrets of writing software and manufaturing the day is not far when US will be sending truck loads of folks to India and China to work and they will be outsourcing their work to US!

Wakeup people!!!

Come on Economit! Don't be a hypocrite, advancing your self-interests. Don't distract those very concerned & serious people tackling very important and real problems. Who cares about jobs and recovery? Only losers...

How many times do I have to shout? The economy cannot recover without good jobs. If unemployment is increasing, it is because there are no jobs available. All this political maneuvering between Republicans and Democrats means nothing to the average person who wants to work. It is about time that the government makes job creation a priority in the public sector and the private sector. I know some will object to my opinion, but I can back it up by hundreds of studies on the psychology of people losing their jobs and subsequently their families because of their job losses. Corporate revenues must be declared and taxes should be applied on the richest to help those who are in the low income bracket. Regulate the banking industry which gives CEOs millions as yearly bonus. Regulate the oil rich companies, insurance companies, drug companies and industries. A more important aspect to human behaviour is moral standing. If we commit to a moral society then less people will indulge in stealing, cheating, and carelessly overspending. Credit should be checked.I wish to applaude Bill Gates and similar billionaires who pledged half of their money for causes of philanthropy.
This is a call to America. Wake up!

We are either consumers or workers. Be careful of what you wish for.

Right now consumer goods due to Chinese production have never been cheaper. The average family benefits from low import prices by an average of $10,000 per year. Low inflation. Indulged populations with cheap flat screen tvs, computers, cameras, cell phones, house furnishings, shoes, clothing etc. Happiness through consumerism.

Now imagine high inflation. Expensive fuel. Expensive consumer products. But an economy re-geared to exports.

Full factories with triple shift production. Now citizens have jobs, but must run to stay in place. No time off for vacation. Wake, go to work, go home and sleep. Cannot afford the latest gadgets. Stable but declining quality of life. Happiness through work.

Is it better if Chinese and American workers switch places? Everything has to be a sustainable balance: work and leisure.

The US is making bad investments and is paying the price

vastly over priced medical

losing wars in Iraq and Afganistan

losing drug war causing violence, carnage and worlds largest, most expensinve police/court/prison complex based on population

most expensive, wasteful management of infastructure projects

credit that should never have been granted

world's greatest government debt to pay for waste and inefficiency

You'd think that if the jobs market is so poor and it's being held back by disappearing government jobs that the solution to the poor jobs market would be obvious. That it is not is not a good sign of the quality of leadership we have. At least in the depression, things got so bad that the old elite was forced to enact meaningful reforms. At least in Japan, quality of living for the public has improved even as growth seemingly stagnated. Instead here all we get is people muddling through while ignoring the public and the worsening outlook for sustainable growth.

The US is collapsing. At the end of WW II we were the only power standing with world wide leadership in technology, education, industry, raw materials, financials and agriculture. By the seventies other countries had caught up and now many have passed us by. Our military can’t win a war and our government fails at most of what it does. We can’t even police our own borders the failure rate is so bad. We are no longer the leader in medical, education, manufacturing, social stability, job creation and many other areas. We are the leader in military spending, low end immigration, labor force participation, people retired, people collecting disability, people collecting welfare, people collecting government benefits, military spending, government spending, medical spending, education spending, government waste, graft in dollar terms, importing oil, creation of low paying, low benefit jobs. The US is going down and the dropping dollar and soaring debt prove it. It's just a question of when protests we see in many states turn violent and the social structure breaks down. Everyone is ripping off the carcass of a dying system. No one will be immune from the collapse.

There is an obvious reason that women are faring worse than men now. Far more women are employed by the public sector than men are excluding the military and police. Government jobs are very politically correct when it comes to hiring women and now that state and local governments are facing the very overdue squeeze, of course the pain will come down on women in the public sector. The local cuts are eventually going to reach the federal level, it is a question of when.

I wonder what US politician will have the gusto to tell Americans that they are going to have to study and work harder, enjoy less job security, make do with less, and on the whole experience a quality of life that is stagnant and in many cases on the middle/lower middle ends of the economic spectrum worse than their parents enjoyed including reduced retirement benefits. Going to be a brutal and frank realization that many simply aren't going to do better than their parents. Shattering of the one key beliefs in American and it will have some really ugly consequences.

Free trade with low-wage, developing countries causes developed country economies and living standards to decline. These countries attempted to hide this fact through borrowing. Some other facts behind this:

1) If you take away home equity extraction due to the housing bubble, the U.S. economy only grew 1% from 2001-2008 and has struggled since. The U.S. needs 3-4% annual growth to avoid unemployment increases.

2) The U.S. household debt to disposable income ratio was 80% in 1990; now it is 120%.

3) Our trade deficit (imports > exports) was 1.5% GDP or so in 1996; it peaked at 5% in 2008. The $650 billion goods deficit represents 10 million jobs overseas making our goods.

4) U.S. manufacturing employment has declined from 17 million in 2000 to 12 million today.

5) The iPod employed 14,000 U.S. workers and 27,000 foreign workers in 2006. If U.S. ingenuity is sending 2/3 of the jobs created overseas, we are in big trouble.

6) The crisis in 2008 represented about $2 trillion in loans annually to the U.S. suddenly drying up. To maintain our GDP, the government and Fed have stepped in. Fed balance sheet has expanded by nearly $2 trillion while the debt has increased about $3 trillion since then, roughly offsetting.

The unpleasant truth is that 10%-15% unemployment is inevitable if we attempt to maintain a much higher living standard than low wage countries we do business with. Either we insulate ourselves, or we risk reversing 100 years of progress until we all meet in the middle at some equilibrium living standard far beneath our own.

The Economist should take a lead on being more precise about recoveries and recessions. There is evidence of an earnings recovery, perhaps an investment recovery, possibly tentative signs of an optimism/business conditions recovery, but so far not much in terms of employment. Not only is productivity a dynamic parameter, but also the putative engines of growth are making step-wise changes to core productivity. It is quite possible for the Dow to rally rationally (of course, the hooray Henries primarily responsible for the rally may be screwing that up again, but that's a different subject) and employment to be flat or anaemic, because the Dow constituents are doing more with fewer people. Legacy relationships between employment growth and the Dow or other bellwethers of growth or recovery are subject to massive, structural changes.