Jobless rate is worse than you think

[BlueGin]

According to this article... if job growth stays the same, it will still take us 6 years to get back to a healthy job market. Not good.

*****************************************************************


Editor's note: Heidi Shierholz is a labor market economist with the Economic Policy Institute in Washington. She is a co-author of "The State of Working America."

(CNN) -- On Labor Day, we celebrate the American worker. And more than four years since the Great Recession ended in June 2009, the unemployment rate is 7.4%, a big improvement from the high of 10% in the fall of 2009. Unfortunately, the rate is hugely misleading: Most of that improvement was for all the wrong reasons.

Remember, jobless workers are not counted as being part of the labor force unless they are actively looking for work, and the decline in the unemployment rate since its peak has mostly been the result of workers dropping out of -- or not entering -- the labor force.

According to Congressional Budget Office estimates, if the labor market were healthy, the labor force would number about 159.2 million. But the actual labor force numbers just 155.8 million. That means about 3.4 million "missing workers" are out there -- jobless people who would be in the labor force if job opportunities were strong.

Given the weak labor market, they're not actively looking for work and so aren't counted. If those missing workers were actively looking, the unemployment rate would be 9.4%.

We need 8.3 million jobs to get back to the prerecession unemployment rate, considering the 2 million jobs we are still down from the start of the Great Recession in December 2007 plus the 6.3 million jobs we should have added since just to keep up with normal growth in the potential labor force.

Opinion: Jobless rate is worse than you think - CNN.com

 

[OnePercenter]

According to this article... if job growth stays the same, it will still take us 6 years to get back to a healthy job market. Not good.

*****************************************************************


Editor's note: Heidi Shierholz is a labor market economist with the Economic Policy Institute in Washington. She is a co-author of "The State of Working America."

(CNN) -- On Labor Day, we celebrate the American worker. And more than four years since the Great Recession ended in June 2009, the unemployment rate is 7.4%, a big improvement from the high of 10% in the fall of 2009. Unfortunately, the rate is hugely misleading: Most of that improvement was for all the wrong reasons.

Remember, jobless workers are not counted as being part of the labor force unless they are actively looking for work, and the decline in the unemployment rate since its peak has mostly been the result of workers dropping out of -- or not entering -- the labor force.

According to Congressional Budget Office estimates, if the labor market were healthy, the labor force would number about 159.2 million. But the actual labor force numbers just 155.8 million. That means about 3.4 million "missing workers" are out there -- jobless people who would be in the labor force if job opportunities were strong.

Given the weak labor market, they're not actively looking for work and so aren't counted. If those missing workers were actively looking, the unemployment rate would be 9.4%.

We need 8.3 million jobs to get back to the prerecession unemployment rate, considering the 2 million jobs we are still down from the start of the Great Recession in December 2007 plus the 6.3 million jobs we should have added since just to keep up with normal growth in the potential labor force.

Opinion: Jobless rate is worse than you think - CNN.com

And yet corporate America is sitting on >$100 Trillion in cash. Maybe we should cut taxes for business.....

 

[S.J.]

I'm sure it's Bush's fault (somehow).

 

[ScienceRocks]

According to this article... if job growth stays the same, it will still take us 6 years to get back to a healthy job market. Not good.

*****************************************************************


Editor's note: Heidi Shierholz is a labor market economist with the Economic Policy Institute in Washington. She is a co-author of "The State of Working America."

(CNN) -- On Labor Day, we celebrate the American worker. And more than four years since the Great Recession ended in June 2009, the unemployment rate is 7.4%, a big improvement from the high of 10% in the fall of 2009. Unfortunately, the rate is hugely misleading: Most of that improvement was for all the wrong reasons.

Remember, jobless workers are not counted as being part of the labor force unless they are actively looking for work, and the decline in the unemployment rate since its peak has mostly been the result of workers dropping out of -- or not entering -- the labor force.

According to Congressional Budget Office estimates, if the labor market were healthy, the labor force would number about 159.2 million. But the actual labor force numbers just 155.8 million. That means about 3.4 million "missing workers" are out there -- jobless people who would be in the labor force if job opportunities were strong.

Given the weak labor market, they're not actively looking for work and so aren't counted. If those missing workers were actively looking, the unemployment rate would be 9.4%.

We need 8.3 million jobs to get back to the prerecession unemployment rate, considering the 2 million jobs we are still down from the start of the Great Recession in December 2007 plus the 6.3 million jobs we should have added since just to keep up with normal growth in the potential labor force.

Opinion: Jobless rate is worse than you think - CNN.com

And yet corporate America is sitting on >$100 Trillion in cash. Maybe we should cut taxes for business.....

We get them to spend by pressing down with the plan of infrastructure, tech and science

How not better ourselves and be the first on mars at the same time We're only number one as long as we push forward.

 

[Rshermr]

According to this article... if job growth stays the same, it will still take us 6 years to get back to a healthy job market. Not good.

*****************************************************************


Editor's note: Heidi Shierholz is a labor market economist with the Economic Policy Institute in Washington. She is a co-author of "The State of Working America."

(CNN) -- On Labor Day, we celebrate the American worker. And more than four years since the Great Recession ended in June 2009, the unemployment rate is 7.4%, a big improvement from the high of 10% in the fall of 2009. Unfortunately, the rate is hugely misleading: Most of that improvement was for all the wrong reasons.

Remember, jobless workers are not counted as being part of the labor force unless they are actively looking for work, and the decline in the unemployment rate since its peak has mostly been the result of workers dropping out of -- or not entering -- the labor force.

According to Congressional Budget Office estimates, if the labor market were healthy, the labor force would number about 159.2 million. But the actual labor force numbers just 155.8 million. That means about 3.4 million "missing workers" are out there -- jobless people who would be in the labor force if job opportunities were strong.

Given the weak labor market, they're not actively looking for work and so aren't counted. If those missing workers were actively looking, the unemployment rate would be 9.4%.

We need 8.3 million jobs to get back to the prerecession unemployment rate, considering the 2 million jobs we are still down from the start of the Great Recession in December 2007 plus the 6.3 million jobs we should have added since just to keep up with normal growth in the potential labor force.

Opinion: Jobless rate is worse than you think - CNN.com

This is a great article that you have linked to. If you read the whole article, it is not just about the current rate of unemployment, but more importantly, WHY IT IS SO AND WHAT NEEDS TO HAPPEN TO GET US BEYOND THE CURRENT CONDITION.

Consider from this article:

The reason we are having such a sluggish jobs recovery is not complicated -- there is simply not enough work to be done. Economists refer to this as weak aggregate demand. Another way to say this is that demand for goods and services hasn't picked up enough for businesses to ramp up hiring.

In the current economy, this means fiscal expansion, such as re-establishing the state and local public services that were cut in the Great Recession and its aftermath, and large-scale infrastructure investments. The priority has to be jobs, not deficit reduction.

This means that in addition to the fiscal expansion in the short run to spur us to full employment, we need policies that will restore the bargaining power of low- and middle-wage workers.
These policies include everything from aggressively increasing the minimum wage until it is equal to half the average worker's wage to updating labor law to keep up with increased employer aggressiveness in fighting unions so that willing workers can join a union. Also, the president needs to take executive action to ensure that federal dollars are never spent employing people in jobs with poverty-level wages.
Broadly, it means making wages grow for not just the affluent but also low- and middle-income workers a key priority in economic policymaking.

If you read what independent labor econoists have to say, there is not much new here. The problem is that we have way too many politicians who are interested in the wealthy and not the working class, and WAY to much interest in the deficit, which is but stupid. The deficit is not a problem. Unemployment and underemployment IS.

 

[Rshermr]

According to this article... if job growth stays the same, it will still take us 6 years to get back to a healthy job market. Not good.

*****************************************************************


Editor's note: Heidi Shierholz is a labor market economist with the Economic Policy Institute in Washington. She is a co-author of "The State of Working America."

(CNN) -- On Labor Day, we celebrate the American worker. And more than four years since the Great Recession ended in June 2009, the unemployment rate is 7.4%, a big improvement from the high of 10% in the fall of 2009. Unfortunately, the rate is hugely misleading: Most of that improvement was for all the wrong reasons.

Remember, jobless workers are not counted as being part of the labor force unless they are actively looking for work, and the decline in the unemployment rate since its peak has mostly been the result of workers dropping out of -- or not entering -- the labor force.

According to Congressional Budget Office estimates, if the labor market were healthy, the labor force would number about 159.2 million. But the actual labor force numbers just 155.8 million. That means about 3.4 million "missing workers" are out there -- jobless people who would be in the labor force if job opportunities were strong.

Given the weak labor market, they're not actively looking for work and so aren't counted. If those missing workers were actively looking, the unemployment rate would be 9.4%.

We need 8.3 million jobs to get back to the prerecession unemployment rate, considering the 2 million jobs we are still down from the start of the Great Recession in December 2007 plus the 6.3 million jobs we should have added since just to keep up with normal growth in the potential labor force.

Opinion: Jobless rate is worse than you think - CNN.com

And yet corporate America is sitting on >$100 Trillion in cash. Maybe we should cut taxes for business.....

Yeah. That will do it. Never, ever worked before in a bad economy. But hell, cut taxes is always popular among the ignorant. By the way, I am not referring to you. I am sure you said what you said tongue in cheek.

 

[OnePercenter]

According to this article... if job growth stays the same, it will still take us 6 years to get back to a healthy job market. Not good.

*****************************************************************


Editor's note: Heidi Shierholz is a labor market economist with the Economic Policy Institute in Washington. She is a co-author of "The State of Working America."

(CNN) -- On Labor Day, we celebrate the American worker. And more than four years since the Great Recession ended in June 2009, the unemployment rate is 7.4%, a big improvement from the high of 10% in the fall of 2009. Unfortunately, the rate is hugely misleading: Most of that improvement was for all the wrong reasons.

Remember, jobless workers are not counted as being part of the labor force unless they are actively looking for work, and the decline in the unemployment rate since its peak has mostly been the result of workers dropping out of -- or not entering -- the labor force.

According to Congressional Budget Office estimates, if the labor market were healthy, the labor force would number about 159.2 million. But the actual labor force numbers just 155.8 million. That means about 3.4 million "missing workers" are out there -- jobless people who would be in the labor force if job opportunities were strong.

Given the weak labor market, they're not actively looking for work and so aren't counted. If those missing workers were actively looking, the unemployment rate would be 9.4%.

We need 8.3 million jobs to get back to the prerecession unemployment rate, considering the 2 million jobs we are still down from the start of the Great Recession in December 2007 plus the 6.3 million jobs we should have added since just to keep up with normal growth in the potential labor force.

Opinion: Jobless rate is worse than you think - CNN.com

And yet corporate America is sitting on >$100 Trillion in cash. Maybe we should cut taxes for business.....

We get them to spend by pressing down with the plan of infrastructure, tech and science

How not better ourselves and be the first on mars at the same time We're only number one as long as we push forward.

You eliminate business deductions except for employee expenses.

 

[BlueGin]

According to this article... if job growth stays the same, it will still take us 6 years to get back to a healthy job market. Not good.

*****************************************************************


Editor's note: Heidi Shierholz is a labor market economist with the Economic Policy Institute in Washington. She is a co-author of "The State of Working America."

(CNN) -- On Labor Day, we celebrate the American worker. And more than four years since the Great Recession ended in June 2009, the unemployment rate is 7.4%, a big improvement from the high of 10% in the fall of 2009. Unfortunately, the rate is hugely misleading: Most of that improvement was for all the wrong reasons.

Remember, jobless workers are not counted as being part of the labor force unless they are actively looking for work, and the decline in the unemployment rate since its peak has mostly been the result of workers dropping out of -- or not entering -- the labor force.

According to Congressional Budget Office estimates, if the labor market were healthy, the labor force would number about 159.2 million. But the actual labor force numbers just 155.8 million. That means about 3.4 million "missing workers" are out there -- jobless people who would be in the labor force if job opportunities were strong.

Given the weak labor market, they're not actively looking for work and so aren't counted. If those missing workers were actively looking, the unemployment rate would be 9.4%.

We need 8.3 million jobs to get back to the prerecession unemployment rate, considering the 2 million jobs we are still down from the start of the Great Recession in December 2007 plus the 6.3 million jobs we should have added since just to keep up with normal growth in the potential labor force.

Opinion: Jobless rate is worse than you think - CNN.com

This is a great article that you have linked to. If you read the whole article, it is not just about the current rate of unemployment, but more importantly, WHY IT IS SO AND WHAT NEEDS TO HAPPEN TO GET US BEYOND THE CURRENT CONDITION.

Consider from this article:

The reason we are having such a sluggish jobs recovery is not complicated -- there is simply not enough work to be done. Economists refer to this as weak aggregate demand. Another way to say this is that demand for goods and services hasn't picked up enough for businesses to ramp up hiring.

In the current economy, this means fiscal expansion, such as re-establishing the state and local public services that were cut in the Great Recession and its aftermath, and large-scale infrastructure investments. The priority has to be jobs, not deficit reduction.

This means that in addition to the fiscal expansion in the short run to spur us to full employment, we need policies that will restore the bargaining power of low- and middle-wage workers.
These policies include everything from aggressively increasing the minimum wage until it is equal to half the average worker's wage to updating labor law to keep up with increased employer aggressiveness in fighting unions so that willing workers can join a union. Also, the president needs to take executive action to ensure that federal dollars are never spent employing people in jobs with poverty-level wages.
Broadly, it means making wages grow for not just the affluent but also low- and middle-income workers a key priority in economic policymaking.

If you read what independent labor econoists have to say, there is not much new here. The problem is that we have way too many politicians who are interested in the wealthy and not the working class, and WAY to much interest in the deficit, which is but stupid. The deficit is not a problem. Unemployment and underemployment IS.

You left out the part I thought was interesting....

Our sustained high unemployment and weak job growth is also hurting wages: When workers have limited outside job opportunities, employers simply don't have to offer much in raises to get and keep the workers they need. The typical worker saw wages drop 2.6% between 2007 and 2012, and with unemployment expected to remain high, wages for most workers aren't expected to grow much -- if at all -- in the next few years.

 

[Joe Steel]

And yet corporate America is sitting on >$100 Trillion in cash. Maybe we should cut taxes for business.....

So they could generate more cash they wouldn't invest?

I don't think so. Instead we should be taxing cash and cash equivalent balances. We should make them spend the money or take it away from them.

 

[edthecynic]

According to this article... if job growth stays the same, it will still take us 6 years to get back to a healthy job market. Not good.

*****************************************************************


Editor's note: Heidi Shierholz is a labor market economist with the Economic Policy Institute in Washington. She is a co-author of "The State of Working America."

According to Congressional Budget Office estimates, if the labor market were healthy, the labor force would number about 159.2 million. But the actual labor force numbers just 155.8 million. That means about 3.4 million "missing workers" are out there -- jobless people who would be in the labor force if job opportunities were strong.

Given the weak labor market, they're not actively looking for work and so aren't counted. If those missing workers were actively looking, the unemployment rate would be 9.4%.

Yet another example of how professional liars, like the author of the article, deliberately mislead by leaving key information out and substituting their opinion, highlighted, to look like it came from the CBO.

Here is what that CBO report actually said was the real reason for the author's invented term "missing workers."

Two factors are especially important to the current projections of participation in the
labor force. The first is near-term economic conditions. Because of the weakened state
of the economy, the labor force is currently well below its potential size; consequently,
CBO expects it to grow faster than its long-term trend between now and 2016. By that
time, CBO projects, the output gap will have closed (that is, the economy will be oper-
ating at its full potential), and the actual labor force will be about equal to the potential
labor force.3 After 2016, CBO expects the growth of the labor force to equal, on aver-
age, the growth of the potential labor force, and it does not attempt to forecast the tim-
ing of subsequent business cycles. The second factor is the impending retirement of the
baby-boom generation (people who were born between 1946 and 1964), which will
cause the potential labor force participation rate to decline throughout the next decade.
In CBO’s estimates, the effect of the second factor outweighs the first, pushing down
the labor force participation rate, on balance, over the next decade.

So we see that it is not the weak economy that has kept and will keep the LPR down, but the BOOMERS retiring!!!!

 

[Defiant1]

And yet corporate America is sitting on >$100 Trillion in cash. Maybe we should cut taxes for business.....

So they could generate more cash they wouldn't invest?

I don't think so. Instead we should be taxing cash and cash equivalent balances. We should make them spend the money or take it away from them.

I'm hearing more and more liberals thinking like you. I say, "thank God for Cayman Island Banks."

And BTW, it is not illegal, immoral, or dishonest to have bank accounts in foreign countries.

 

[AmazonTania]

According to this article... if job growth stays the same, it will still take us 6 years to get back to a healthy job market. Not good.

*****************************************************************


Editor's note: Heidi Shierholz is a labor market economist with the Economic Policy Institute in Washington. She is a co-author of "The State of Working America."

(CNN) -- On Labor Day, we celebrate the American worker. And more than four years since the Great Recession ended in June 2009, the unemployment rate is 7.4%, a big improvement from the high of 10% in the fall of 2009. Unfortunately, the rate is hugely misleading: Most of that improvement was for all the wrong reasons.

Remember, jobless workers are not counted as being part of the labor force unless they are actively looking for work, and the decline in the unemployment rate since its peak has mostly been the result of workers dropping out of -- or not entering -- the labor force.

According to Congressional Budget Office estimates, if the labor market were healthy, the labor force would number about 159.2 million. But the actual labor force numbers just 155.8 million. That means about 3.4 million "missing workers" are out there -- jobless people who would be in the labor force if job opportunities were strong.

Given the weak labor market, they're not actively looking for work and so aren't counted. If those missing workers were actively looking, the unemployment rate would be 9.4%.

We need 8.3 million jobs to get back to the prerecession unemployment rate, considering the 2 million jobs we are still down from the start of the Great Recession in December 2007 plus the 6.3 million jobs we should have added since just to keep up with normal growth in the potential labor force.

Opinion: Jobless rate is worse than you think - CNN.com

And yet corporate America is sitting on >$100 Trillion in cash. Maybe we should cut taxes for business.....

They are sitting on $100 Trillion on paper anyway. Many of these profits are unrealized, as debt-to-equity ratios pushes closer to pre-recession trends. Much of this money is borrowed, which may be used solely for their operational cost rather than to make new investments. Many of the shortfalls in the economy are due to investments spending in the production structure of the economy.

 

[Rshermr]

According to this article... if job growth stays the same, it will still take us 6 years to get back to a healthy job market. Not good.

*****************************************************************


Editor's note: Heidi Shierholz is a labor market economist with the Economic Policy Institute in Washington. She is a co-author of "The State of Working America."

(CNN) -- On Labor Day, we celebrate the American worker. And more than four years since the Great Recession ended in June 2009, the unemployment rate is 7.4%, a big improvement from the high of 10% in the fall of 2009. Unfortunately, the rate is hugely misleading: Most of that improvement was for all the wrong reasons.

Remember, jobless workers are not counted as being part of the labor force unless they are actively looking for work, and the decline in the unemployment rate since its peak has mostly been the result of workers dropping out of -- or not entering -- the labor force.

According to Congressional Budget Office estimates, if the labor market were healthy, the labor force would number about 159.2 million. But the actual labor force numbers just 155.8 million. That means about 3.4 million "missing workers" are out there -- jobless people who would be in the labor force if job opportunities were strong.

Given the weak labor market, they're not actively looking for work and so aren't counted. If those missing workers were actively looking, the unemployment rate would be 9.4%.

We need 8.3 million jobs to get back to the prerecession unemployment rate, considering the 2 million jobs we are still down from the start of the Great Recession in December 2007 plus the 6.3 million jobs we should have added since just to keep up with normal growth in the potential labor force.

Opinion: Jobless rate is worse than you think - CNN.com

This is a great article that you have linked to. If you read the whole article, it is not just about the current rate of unemployment, but more importantly, WHY IT IS SO AND WHAT NEEDS TO HAPPEN TO GET US BEYOND THE CURRENT CONDITION.

Consider from this article:






If you read what independent labor econoists have to say, there is not much new here. The problem is that we have way too many politicians who are interested in the wealthy and not the working class, and WAY to much interest in the deficit, which is but stupid. The deficit is not a problem. Unemployment and underemployment IS.

You left out the part I thought was interesting....

Our sustained high unemployment and weak job growth is also hurting wages: When workers have limited outside job opportunities, employers simply don't have to offer much in raises to get and keep the workers they need. The typical worker saw wages drop 2.6% between 2007 and 2012, and with unemployment expected to remain high, wages for most workers aren't expected to grow much -- if at all -- in the next few years.

Yup. that is important. But what I see as important is why is it the case, and what do we do about it.

 

[Joe Steel]

So they could generate more cash they wouldn't invest?

I don't think so. Instead we should be taxing cash and cash equivalent balances. We should make them spend the money or take it away from them.

I'm hearing more and more liberals thinking like you. I say, "thank God for Cayman Island Banks."

And BTW, it is not illegal, immoral, or dishonest to have bank accounts in foreign countries.

Maybe not unlawful or dishonest but immoral is another issue.

Morality is a common sense of right and wrong. Many Americans feel keeping cash in offshore banks is wrong when it's done to avoid taxes.

 

[oldfart]

Here is what that CBO report actually said was the real reason for the author's invented term "missing workers."

Two factors are especially important to the current projections of participation in the labor force. The first is near-term economic conditions. Because of the weakened state of the economy, the labor force is currently well below its potential size; consequently, CBO expects it to grow faster than its long-term trend between now and 2016. By that time, CBO projects, the output gap will have closed (that is, the economy will be operating at its full potential), and the actual labor force will be about equal to the potential labor force.3 After 2016, CBO expects the growth of the labor force to equal, on average, the growth of the potential labor force, and it does not attempt to forecast the timing of subsequent business cycles. The second factor is the impending retirement of the baby-boom generation (people who were born between 1946 and 1964), which will cause the potential labor force participation rate to decline throughout the next decade.

In CBO’s estimates, the effect of the second factor outweighs the first, pushing down the labor force participation rate, on balance, over the next decade.

So we see that it is not the weak economy that has kept and will keep the LPR down, but the BOOMERS retiring!!!![/QUOTE]

The author of the quote was clearly identified and was making a "back-of-the-envelope" calculation. You are free to disagree. I congratulate you for going over the CBO report itself.

That said, the conclusions are basically correct. CBO forecasts are famous for being overoptimistic about GDP growth and employment recovery three or more years out. We are already five years along and most models show us five years or more from achieving the long-term trend line on employment. At that point the labor force participation rate will be about two points lower (~57.5%). This does nothing to disprove the CBO's conclusions about the gap between potential GDP and current real GDP, and the labor market implications.

Now CBO puts out a semi-annual update of its projections. I usually read them when issued, and I'm sure you would be able to find them also. What do you think they project for employment and unemployment in the next ten years?

 

[AmazonTania]

So they could generate more cash they wouldn't invest?

I don't think so. Instead we should be taxing cash and cash equivalent balances. We should make them spend the money or take it away from them.

I'm hearing more and more liberals thinking like you. I say, "thank God for Cayman Island Banks."

And BTW, it is not illegal, immoral, or dishonest to have bank accounts in foreign countries.

Maybe not unlawful or dishonest but immoral is another issue.

Morality is a common sense of right and wrong. Many Americans feel keeping cash in offshore banks is wrong when it's done to avoid taxes.

Why?

 

[edthecynic]

Here is what that CBO report actually said was the real reason for the author's invented term "missing workers."

Two factors are especially important to the current projections of participation in the labor force. The first is near-term economic conditions. Because of the weakened state of the economy, the labor force is currently well below its potential size; consequently, CBO expects it to grow faster than its long-term trend between now and 2016. By that time, CBO projects, the output gap will have closed (that is, the economy will be operating at its full potential), and the actual labor force will be about equal to the potential labor force.3 After 2016, CBO expects the growth of the labor force to equal, on average, the growth of the potential labor force, and it does not attempt to forecast the timing of subsequent business cycles. The second factor is the impending retirement of the baby-boom generation (people who were born between 1946 and 1964), which will cause the potential labor force participation rate to decline throughout the next decade.
In CBO’s estimates, the effect of the second factor outweighs the first, pushing down the labor force participation rate, on balance, over the next decade.

So we see that it is not the weak economy that has kept and will keep the LPR down, but the BOOMERS retiring!!!!

The author of the quote was clearly identified and was making a "back-of-the-envelope" calculation. You are free to disagree. I congratulate you for going over the CBO report itself.

That said, the conclusions are basically correct.

She was making a calculation based on a false premise that she must have known was false since the very CBO report she used told her the truth. How that makes her conclusions "basically correct" is beyond me.

Boomers retiring are not "missing workers" who need to be added into the UE rate so the Right can manufacture a higher number, and as soon as there is a GOP president you will never hear about "missing workers" as the LPR continues to fall until all the Boomers are gone.

It"s just like the deficit, when Reagan ran, Carter's debt was generational theft, once he was elected debt didn't matter for him and Bush I. Clinton gets elected and deficits are the scourge of the country until Bush II gets elected when suddenly they don't matter any more. Now Obama is elected and deficits will kill this great nation. The U-6 rate and Constant Labor Force unemployment numbers were never used for Bush, but now are in vogue for Obama and will be passe for the next GOP president. The Right will always have a double standard. The U-3 rate has always been good enough for GOP presidents and therefore it is good enough for Obama.

 

[Rshermr]

Here is what that CBO report actually said was the real reason for the author's invented term "missing workers."

Two factors are especially important to the current projections of participation in the labor force. The first is near-term economic conditions. Because of the weakened state of the economy, the labor force is currently well below its potential size; consequently, CBO expects it to grow faster than its long-term trend between now and 2016. By that time, CBO projects, the output gap will have closed (that is, the economy will be operating at its full potential), and the actual labor force will be about equal to the potential labor force.3 After 2016, CBO expects the growth of the labor force to equal, on average, the growth of the potential labor force, and it does not attempt to forecast the timing of subsequent business cycles. The second factor is the impending retirement of the baby-boom generation (people who were born between 1946 and 1964), which will cause the potential labor force participation rate to decline throughout the next decade.

In CBO’s estimates, the effect of the second factor outweighs the first, pushing down the labor force participation rate, on balance, over the next decade.

So we see that it is not the weak economy that has kept and will keep the LPR down, but the BOOMERS retiring!!!!

The author of the quote was clearly identified and was making a "back-of-the-envelope" calculation. You are free to disagree. I congratulate you for going over the CBO report itself.

That said, the conclusions are basically correct. CBO forecasts are famous for being overoptimistic about GDP growth and employment recovery three or more years out. We are already five years along and most models show us five years or more from achieving the long-term trend line on employment. At that point the labor force participation rate will be about two points lower (~57.5%). This does nothing to disprove the CBO's conclusions about the gap between potential GDP and current real GDP, and the labor market implications.

Now CBO puts out a semi-annual update of its projections. I usually read them when issued, and I'm sure you would be able to find them also. What do you think they project for employment and unemployment in the next ten years?[/QUOTE]


Good enough. It seems to me that retirement rates are a fact, and have been predictable since the mid 1950's. Nothing we could have done anything about. But what is important is what are the other causes of a higher than hoped for ue rate. Those causes that may be something we can rectify. And what do we do about it. And this article provides rational points relative to these points. I think it would be much more useful to discus the authors contentions re ue, and her ideas about what to do about it.
All this is leading to is a food fight based on agenda. Which is a useless exercise. So, what are your thoughts?

 

[Joe Steel]

Maybe not unlawful or dishonest but immoral is another issue.

Morality is a common sense of right and wrong. Many Americans feel keeping cash in offshore banks is wrong when it's done to avoid taxes.

Why?

American firms exist because of American culture. They benefit from it so they should contribute to it.

 

[AmazonTania]

Maybe not unlawful or dishonest but immoral is another issue.

Morality is a common sense of right and wrong. Many Americans feel keeping cash in offshore banks is wrong when it's done to avoid taxes.

Why?

American firms exist because of American culture. They benefit from it so they should contribute to it.

No, they don't. They exist because they have consumers who are willing to buy their goods and services. They owe you nothing.