Last week I discussed the tendency for policymakers to treat the Pentagon like a giant jobs program. It was prompted by an article from the Associated Press on members of Congress shoving unwanted upgraded Abrams tanks down taxpayers’ throats because retooling tanks sustains jobs back in the district. As it turns out, former Reagan budget director David Stockman touches on the Abrams tank situation in his new book, The Great Deformation.
In Chapter 5 – “Triumph of the Warfare State” – Stockman gives an account of the behind-the-scenes dealings that resulted in the massive military buildup during the Reagan administration. Stockman says political calculations – and not “one scintilla of bottoms-up program detail or even a single hour of professional analysis” – drove the new Reagan administration to champion 7 percent (real) growth in defense spending every year for five years (1982-1986), and from a already elevated level. According to Stockman, the “7 percent real growth top line” was a “blank check” for the Pentagon to go on a spending binge – much to the pleasure of the military-industrial complex.
From p. 74:
No fresh start or strategically coherent defense plan was ever developed by the Reagan administration. This immense, content-free “top line” was simply backfilled by the greatest stampede of Pentagon log-rolling and budget aggrandizement by the military-industrial complex ever recorded.
In a process that went on week after week for the better part of a year, the huge swaths of empty budget space under the new defense “top line” were converted into more and more of virtually everything that inhabited the Pentagon’s vasty deep. Much of it, which had languished for years and decades on the wish lists of the brass and military contractors, now got funded without much ado.
With defense funds being virtually slopped onto the waiting plates of the four military services, it is not surprising that much of it went to the conventional forces. Notwithstanding all the scary stories about the nascent Soviet nuclear first-strike capabilities, there really weren’t many concrete programs to counter it except for a new strategic bomber and an MX missile upgrade.
At the heart of the Reagan defense buildup, therefore, was a great double shuffle. The war drums were sounding a strategic nuclear threat that virtually imperiled American civilization. Yet the money was actually being allocated to tanks, amphibious landing craft, close air support helicopters, and a vast conventional armada of ships and planes.
These weapons were of little use in the existing nuclear standoff, but were well suited to imperialistic missions of invasion and occupation. Ironically, therefore, the Reagan defense buildup was justified by an Evil Empire that was rapidly fading but was eventually used to launce elective wars against an Axis of Evil which didn’t even exist.
That leads to the Abrams tank.
From pp. 77-78:
The two big land war programs launched during the Reagan build-up – the upgraded Abrams Tank and the Bradley Fighting Vehicle – experienced a similar untoward evolution. At the time of the Reagan top line windfall in 1981, there was ferocious debate among the experts as to whether a new, more expensive generation of the M1 tank should be developed.
Yet issues of cost and efficiency were no longer even debatable after the 7 percent growth top line became operative on January 30, 1981. The empty space in DOD’s new $1.46 trillion plan was so vast that both programs were sucked into its budget like air rushing into a vacuum. Over the next decade 7,000 Bradley’s and 6,000 M1 Abrams tanks were procured – useless weapons against a Soviet nuclear strike, but ideal missions of invasion and occupation.
Moreover, once Bradley and Abrams productions lines were open, the odds of closing them down were between slim and none. Armored battlefield vehicles consist of an intensive mix of iron, precision machining, and complex electronic components and circuitry – which is to say, they are a “jobs program” par excellence.
The case can be seen in Lima, Ohio, where the M1 tank line refuses to shut down – 40 years after the 7 percent top line brought it unnecessarily to life. Since then all of the nation’s industrial enemies have either expired, as in the case of the Soviets, or retired to civilian life, as in the case of China.
What passes for a state-based enemy is a nation of 78 million deeply unhappy citizens ruled by twelfth-century mullahs, who major act of aggression over the past thirty years was to repel an attack by its Iraqi neighbor with twelve-year-old soldiers carrying stick rifles. Still, the military-industrial complex manages to keep retooling, upgrading, and modernizing its fleet of 9,000 Abrams tanks as if the Berlin crisis of 1961 never ended.
Agree with Stockman or not, one can’t deny that he’s a colorful writer!
View full post on Cato @ Liberty
If you think that the latest employment numbers are good news, you might want to look again. In April 2013, 58.6 percent of all working age Americans had a job. But three years ago, in April 2010, 58.7 percent of all working age Americans had a job. Well, you may argue, that is not much of a difference. And that is precisely my point. The percentage of Americans that have a job fell like a rock during the last recession. It dropped from about 63 percent all the way down to below 59 percent, and it has stayed below 59 percent for 44 months in a row. So where is the recovery? This is the first time in the post-World War II era that the employment-population ratio has not bounced back after the end of a recession. So anyone that tells you that we are experiencing an employment recovery is lying to you. Yes, the U.S. economy added 165,000 jobs last month. But it takes nearly that many jobs just to keep up with population growth. The truth is that we are just treading water.
So why has the unemployment rate been going down? Well, it is because the government has been pretending that millions upon millions of unemployed Americans “don’t want jobs” anymore. In fact, an astounding 9.5 million Americans have “left the workforce” since Barack Obama took office.
Some in the mainstream media have started calling them “missing workers”. But whatever label you want to use, the reality of the matter is that they are really hurting. They are part of the reason why food stamp enrollment has soared from 32 million to more than 47 million while Barack Obama has been in the White House.
If you still believe that the employment market is getting better, just look at the following numbers. The percentage of working age Americans with a job has been sitting at about the same level for four years in a row…
April 2008: 62.7 percent
April 2009: 59.8 percent
April 2010: 58.7 percent
April 2011: 58.4 percent
April 2012: 58.5 percent
April 2013: 58.6 percent
So why is everyone getting so excited over the latest numbers? When you step back and look at what has happened to the employment-population ratio over the past decade it really is quite horrifying…
So exactly what part of that chart are we supposed to get excited about?
Yes, I suppose that we should be thankful that the percentage of Americans with a job has not continued to decline over the past few years. Unfortunately, the next major wave of the economic collapse is rapidly approaching and that is going to make our employment crisis far worse.
A recovery was supposed to already happen by now. Now we are running out of time before the next major downturn strikes.
And things have been particularly hard for our young people. Even if our young people do go to college, there is a very good chance that good jobs will not be waiting for them once they graduate.
According to Accenture’s 2013 College Graduate Employment Survey, 41 percent of all Millennials who graduated from college during the past two years are working in jobs that actually do not require a college degree.
And a different survey conducted a while back found that 53 percent of all college graduates under the age of 25 are either unemployed or underemployed.
Perhaps you have noticed this. Perhaps you have noticed that there seems to be large numbers of young people that are living with their parents or that can’t seem to get their lives started.
It is because the economy is not producing enough jobs for them.
Sadly, the future does not look bright for the American worker. The big corporations that dominate our society are feverishly trying to increase profits by getting rid of as many “expensive” American workers as possible. That is one of the reasons why corporate profits as a percentage of GDP are at a record high, but wages as a percentage of GDP are at an all-time low.
At this point there are more than 101 million working age Americans that do not have a job, and that number is going to go a lot higher in the years ahead.
But the financial markets seem to be absolutely thrilled with the present state of affairs. The latest employment numbers caused the Dow to shoot past 15,000 and the S&P 500 to push past 1600.
Of course stocks have become completely and totally divorced from economic reality, but this does happen from time to time and it never lasts forever. At some point there will be a rude awakening.
And I anticipated that we could potentially see the Dow hit 15,000 before it finally crashed. Back in February, I made the following statement…
Right now, everyone seems to be quite giddy about the fact that the Dow is marching toward an all-time high. And I actually do believe that the Dow will blow right past it. In fact, it is even possible that we could see the Dow hit 15,000 before everything starts falling apart.
Well, now we have seen the Dow hit 15,000. But that doesn’t change any of the long-term trends that are absolutely eviscerating our economy.
So enjoy this bubble of false hope while you can.
It will not last much longer.
View full post on The Economic Collapse
One of the realizations that helped me to dispense of the neoconish foreign policy views of my youth is that for federal policymakers, the Pentagon is like a giant jobs program. Regardless of need, a military installation or armament factory can generally count on the unwavering support of the member of Congress who represents the district or state where the facility is located.
On Monday, the Associated Press’s Richard Lardner provided a textbook example: over the past two years Congress has spent almost a half billion taxpayer dollars—and wants to spend another $436 million—upgrading Abrams tanks that experts and the Army itself say aren’t needed.
Who are some of the biggest congressional backers of the tank upgrading? Why, Republican “deficit hawks”!
Keeping the Abrams production line rolling protects businesses and good paying jobs in congressional districts where the tank’s many suppliers are located.
If there’s a home of the Abrams, it’s politically important Ohio. The nation’s only tank plant is in Lima. So it’s no coincidence that the champions for more tanks are Rep. Jim Jordan and Sen. Rob Portman, two of Capitol’s Hill most prominent deficit hawks, as well as Democratic Sen. Sherrod Brown. They said their support is rooted in protecting national security, not in pork-barrel politics.
“The one area where we are supposed to spend taxpayer money is in defense of the country,” said Jordan, whose district in the northwest part of the state includes the tank plant.
Ah, yes, the “national security” excuse—probably the most cited justification by politicians to spend other people’s money since the ink dried on the Constitution.
Remove the flag that politicians like to wrap themselves in and it becomes pretty obvious that crass pork-barreling is the big motivator. Defense contractors know the score, which is why work is farmed out to subcontractors in numerous states and districts:
The Lima plant is a study in how federal dollars affect local communities, which in turn hold tight to the federal dollars. The facility is owned by the federal government but operated by the land systems division of General Dynamics, a major defense contractor that spent close to $11 million last year on lobbying, according to the nonpartisan Center for Responsive Politics…
The first editions of the Abrams tank were fielded in the early 1980s. Over the decades, the Abrams supply chain has become embedded in communities across the country.
General Dynamics estimated in 2011 that there were more than 560 subcontractors throughout the country involved in the Abrams program and that they employed as many as 18,000 people. More than 40 of the companies are in Pennsylvania, according to Sen. Robert Casey, D-Pa., also a staunch backer of continued tank production.
A letter signed by 173 Democratic and Republican members of the House last year and sent to then-Defense Secretary Leon Panetta demonstrated the depth of bipartisan support for the Abrams program on Capitol Hill. They chided the Obama administration for neglecting the industrial base and proposing to terminate tank production in the United States for the first time since World War II.
This is why U.S. taxpayers are subsidizing the security of wealthy allies.
View full post on Cato @ Liberty
More Than 101 Million Working Age Americans Do Not Have A Job
By Michael, on April 7th, 2013
The jobs recovery is a complete and total myth. The percentage of the working age population in the United States that had a job in March 2013 was exactly the same as it was all the way back in March 2010. In addition, as you will see below, there are now more than 101 million working age Americans that do not have a job. But even though the employment level in the United States has consistently remained very low over the past three years, the Obama administration keeps telling us that unemployment is actually going down. In fact, they tell us that the unemployment rate has declined from a peak of 10.0% all the way down to 7.6%. And they tell us that in March the unemployment rate fell by 0.1% even though only 88,000 jobs were added to the U.S. economy. But it takes at least 125,000 new jobs a month just to keep up with population growth. So how in the world are they coming up with these numbers? Well, the reality is that the entire decline in the unemployment rate over the past three years can be accounted for by the reduction in size of the labor force. In other words, the Obama administration is getting unemployment to go down by pretending that millions upon millions of unemployed Americans simply do not want jobs anymore. We saw this once again in March. According to the U.S. Bureau of Labor Statistics, more than 600,000 Americans dropped out of the labor market during that month alone. That pushed the labor force participation rate down to 63.3%, which is the lowest it has been in more than 30 years. So please don’t believe the hype. The sad truth is that there has been no jobs recovery whatsoever.
If things were getting better, there would not be more than 101 million working age Americans without a job.
So exactly where does that statistic come from? Well, the following explains where I got that number…
According to the U.S. Bureau of Labor Statistics, there are 11,742,000 working age Americans that are officially unemployed.
In addition, the U.S. Bureau of Labor Statistics says that there are 89,967,000 working age Americans that are "not in the labor force". That is a new all-time record, and that number increased by a whopping 663,000 during the month of March alone.
When you add 11,742,000 working age Americans that are officially unemployed to the 89,967,000 working age Americans that are "not in the labor force", you come up with a grand total of 101,709,000 working age Americans that do not have a job.
When you stop and think about it, that is an absolutely staggering statistic.
And anyone that tells you that "a higher percentage of Americans are working today" is telling you a complete and total lie. During the last recession the percentage of working age Americans with a job fell dramatically, and since then we have not seen that number bounce back at all. In fact, this is the very first time in the post-World War II era that we have not seen the employment-population ratio bounce back after a recession. At this point, the employment-population ratio has been under 60 percent for 49 months in a row…
Since the end of 2009, the employment-population ratio has been remarkably steady. Just check out these numbers…
March 2008: 62.7 percent
March 2009: 59.9 percent
March 2010: 58.5 percent
March 2011: 58.4 percent
March 2012: 58.5 percent
March 2013: 58.5 percent
We should be thankful that the percentage of working age Americans with a job did not continue to decline, but we should also be quite alarmed that it has not bounced back at all.
If there was going to be a recovery, there would have been one by now. The next major economic downturn is rapidly approaching, and that is going to push the employment-population ratio down even farther.
So why is the U.S. economy not producing as many jobs as it used to? Well, certainly the overall decline of the economy has a lot to do with it. We are a nation that is drowning in debt and that is getting poorer by the day.
But since the end of the last recession, corporate profits have bounced back in a big way and are now at an all-time high. So you would figure that the big corporations should be able to hire a lot more workers by now.
Unfortunately, that is not the way things work anymore. Big corporations are trying to minimize the number of expensive American workers that they have on their payrolls as much as possible these days.
One way that they are doing this is through the use of technology. Thanks to robots, computers and other forms of technology, big corporations simply do not need as many human workers as they used to. In future years, this trend is only going to accelerate. I wrote about how this is changing the world of employment in one of my previous articles entitled "Rise Of The Droids: Will Robots Eventually Steal All Of Our Jobs?"
Another way that big corporations are replacing expensive American workers is by shipping their jobs off to the other side of the globe. Big corporations know that they can make bigger profits by making stuff in foreign countries where they can pay workers less than a dollar an hour with no benefits. How in the world are American workers supposed to compete with that?
For much more on how U.S. jobs are being killed by offshoring, please see this article: "55 Reasons Why You Should Buy Products That Are Made In America".
And of course immigration is having a dramatic impact on the labor market in some areas of the country as well. Cheap labor has dramatically driven down wages in a lot of professions. For example, once upon a time you could live a very nice middle class lifestyle as a roofer. But now many roofers really struggle to make a living.
When you add everything up, it paints a very bleak picture for the future of the American worker.
The cost of living keeps rising much faster than wages do, and the competition for good jobs has become incredibly fierce.
Meanwhile, the government continues to make things even easier for those that are not working. This has caused some Americans to give up completely and to be content with letting the government take care of them. The following is from a recent article by Monty Pelerin…
As we make it easier to get unemployment benefits for longer time periods, more people take advantage of the system. So too with food stamps and disability. All programs are at or near record levels in what is supposed to be four years into an economic recovery. For many, the benefits of becoming a government dependent exceed what they can earn. One study reported that a family of four, collecting all the benefits for which they were entitled, would have to earn $65,000 per annum to have the same after-tax purchasing power.
If you are a product of the government schools and are legal to work (i.e., have skills enough that you are affordable at the minimum wage or higher), at what point do you realize that there is no need to go through the hassle of actual work. You can live pretty well by staying home and taking advantage of the entitlements available to you. That is exactly what a larger and larger percentage of the population are realizing. In many cases, it is economically irrational to work.
This behavior creates a social pathology that only worsens over time. Kids learn from their parents that work is not necessary and the many ways to game the system. In this regard, look for this problem to become worse over time unless these programs are cut back.
In some areas of the country, it actually pays not to work very hard. According to Gary Alexander, the Secretary of Public Welfare for the state of Pennsylvania, a "single mom is better off earnings gross income of $29,000 with $57,327 in net income & benefits than to earn gross income of $69,000 with net income and benefits of $57,045."
But the truth is that most Americans still want to work hard and would gladly take a good job if they could just find one. The following is one example that was featured in a recent Fox News article…
After a full year of fruitless job hunting, Natasha Baebler just gave up.
She’d already abandoned hope of getting work in her field, working with the disabled. But she couldn’t land anything else, either — not even a job interview at a telephone call center.
Until she feels confident enough to send out resumes again, she’ll get by on food stamps and disability checks from Social Security and live with her parents in St. Louis.
"I’m not proud of it," says Baebler, who is in her mid-30s and is blind. "The only way I’m able to sustain any semblance of self-preservation is to rely on government programs that I have no desire to be on."
And that is how most Americans feel.
Most Americans do not want to be dependent on the government.
Most Americans want to work hard and take care of themselves.
Unfortunately, our economy is not producing nearly enough jobs for everyone and it never will again.
So there will continue to be millions upon millions of Americans that find that they cannot take care of themselves and their families without government assistance no matter how hard they try.
And this is just the beginning – things are going to get much worse during the next major wave of the economic collapse.
Yes, at the moment there are more than 101 million working age Americans that do not have a job, but that number is actually going to go much higher in the years ahead. The anger and frustration caused by a lack of employment opportunities is going to shake this nation.
That is why it is important to try to become less dependent on your own job. In this economic environment, a job can disappear at literally any moment. Anything that you can do to become less dependent on the system would be a good thing.
Statistics: Posted by yoda — Sun Apr 07, 2013 8:01 pm
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The Robot Reality: Service Jobs Are Next to Go
Published: Tuesday, 26 Mar 2013 | 12:39 PM ET
By: Blaire Briody, The Fiscal Times
If you meet Baxter, the latest humanoid robot from Rethink Robotics – you should get comfortable with him, because you’ll likely be seeing more of him soon.
Rethink Robotics released Baxter last fall and received an overwhelming response from the manufacturing industry, selling out of their production capacity through April. He’s cheap to buy ($22,000), easy to train, and can safely work side-by-side with humans. He’s just what factories need to make their assembly lines more efficient – and yes, to replace costly human workers.
But manufacturing is only the beginning.
This April, Rethink will launch a software platform that will allow Baxter to do a more complex sequencing of tasks – for example, picking up a part, holding it in front of an inspection station and receiving a signal to place it in a "good" or "not good" pile. The company is also releasing a software development kit soon that will allow third parties – like university robotics researchers – to create applications for Baxter.
These third parties "are going to do all sorts of stuff we haven’t envisioned," says Scott Eckert, CEO of Rethink Robotics. He envisions something similar to Apple’s app store happening for Baxter. A spiffed-up version of the robot could soon be seen flipping burgers at McDonalds, folding t-shirts at Gap, or pouring coffee at Starbucks.
"Could [Baxter] be a barista?" asks Eckert. "It’s not a target market, but it’s something that’s pretty repeatable. Put a cup in, push a button, espresso comes out, etc. There are simple repeatable service tasks that Baxter could do over time."
(More From The Fiscal Times: The Rise of Robots and Decline of Jobs)
Companies might not need to wait for a more advanced version of Baxter – MIT already has a BakeBot that can read recipes, whip together cookie dough and place it in the oven. The University of California at Berkeley has a robot that can do laundry and fold T-shirts. Robot servers have started waiting tables at restaurants in Japan, South Korea, China and Thailand – and just last week, a robot served Passover matzah to President Obama during his trip to Israel.
"Every year, machines are getting more capable of doing low-level tasks," says Professor Seth Teller, a robotics researcher at MIT’s Computer Science and Artificial Intelligence Lab.
The Great Job Transformation
Many experts worry about what robots in the service sector could do to employment. The national unemployment rate remains at 7.7 percent – not remotely close to the 4.7 percent unemployment in 2007 before the recession. Job growth isn’t expected to return to pre-recession levels until 2017, and the recent sequestration could easily derail it. Manufacturing has already shed nearly 6 million jobs since 2000.
"When machines and robots start taking over service sector jobs, that’s when we’ll really start to notice," says Martin Ford, robotics expert and author of The Lights In the Tunnel: Automation, Accelerating Technology and the Economy of the Future. "If you’re making hamburgers or Starbucks drinks, that’s really just high manufacturing."
(More From The Fiscal Times: The Robot Revolution: Your Job May Be Next)
What’s worrisome to Ford is that these jobs have been offering a huge safety net to the middle class. They’re jobs he calls "the jobs of last resort." When someone can’t find a salaried job, they look for lower-paying service jobs to get by – and because the jobs typically have a high turnover rate, they’re more likely to be available. Think of all the college graduates who take jobs as cashiers or baristas before they find salaried work. If those jobs were to vanish, those workers would be forced to file for unemployment instead."
Retail and service industries are the largest employers in the U.S., accounting for nearly 20 percent of total employment in 2011, according to the latest data available from the BLS. The retail sector employs nearly 14.8 million people, with Walmart employing 10 percent of them. On top of that, one in five retail workers are the sole income earners in their household. The U.S. restaurant industry employs 9.5 million people, and nearly 50 percent of all adults have worked in the restaurant industry at some point in their life, according to a 2012 report from the Workforce Strategies Initiative at the Aspen Institute. Compare these numbers to the tech job "boom" at companies like Facebook, Apple, Amazon and Google – and you get a mere 190,000 people.
Restaurant work also supports aging boomers as they transition out of the workforce – 12 percent of restaurant workers are 55 and older. "Many older Americans have fallen back on jobs in the restaurant industry, as they seek to transition to a new career or are simply unable to find other work," write the authors of the Aspen Institute report.
Robot Lifeguard to Debut on Connecticut Beach
This summer, lifeguards at one Connecticut beach will be getting an assist from a robot known as Emily, which can reach a troubled swimmer far faster than a lifeguard. Ryan Hanrahan reports.
Teller at MIT argues that economic disruption from technology is nothing new – we’ve seen it before with inventions like the cotton gin, the automobile, and the personal computer. "One way to frame this is robots are taking human jobs away, but technology has, throughout history, transformed the nature of human jobs," he says. "As machines get more capable, they take on functions that were previously performed by people. There’s a displacement, certainly, but we’re still seeing this transformation play out, so you just don’t know whether there’s going to be a net gain or a loss [of jobs]."
According to Teller, Baxter and other robots could create jobs in new industries we haven’t even envisioned yet. The PC, for example, eliminated plenty of jobs while creating millions of others. And he has a point – Baxter is creating some jobs. Rethink Robotics employs 85 people at their Boston headquarters that would’ve never existed without Baxter – though most are high-level engineers, designers and salespeople.
(More From The Fiscal Times: Ten Jobs That Won’t Be Taken By Robots…Yet)
At the factories that are buying Baxter, employers now create robot "managers" to oversee Baxter. Baxter is also made in the U.S., and Rethink employs some 100 people in factories and distributors – though in an ironic twist, they’re already planning to use Baxter to help build Baxter.
As robots move into other sectors and the home, Teller says the job opportunities are abundant. Robot IT and maintenance personnel, designers and salespeople for robot accessories, software, and apps, and robot security developers are just a few examples. "If personal robots are the next thing and everyone wants one in their house, doing the laundry and unloading the dishwasher, we’re talking about another decade of massive economic activity," says Teller.
The PC, however, also created a decade of economic wealth – but the wealth has largely stayed at the top. Facebook, Apple, Amazon and Google don’t employ many people, relatively speaking, but they have about 6.25 percent of the market cap of all U.S. companies. Yes, PCs have created IT jobs and software developers, but the tech industry is small compared to retail and restaurant industries. Computer and mathematical jobs make up about 3 percent of the labor force, according to the BLS, and require advanced degrees and years of training. Will the U.S.’s higher education system be prepared for massive retraining? Will service employees have the time and resources to learn new skills? Will enough high-skill jobs be available for them? No one is quite sure where they’ll go when robots like Baxter push them out.
Erik Brynjolfsson, director of the MIT Center for Digital Business and co-author of Rise Against the Machine, has been warning economists about the coming job disruption for years. "Technology doesn’t automatically lift the fortunes of all people," Brynjolfsson said recently to a crowd at Wharton University in San Francisco. "Profits [in the U.S.] have never been higher, innovation is roaring along, GDP is high, but job creation is lagging terribly, and the share of profits going to labor is at a 60-year low. This is one of the most important issues facing our society."
Statistics: Posted by yoda — Tue Mar 26, 2013 12:50 pm
View full post on opinions.caduceusx.com
Unauthorized and low skilled immigrants are attracted to America’s labor markets, not the size of welfare benefits. From 2003 through 2012, many unauthorized immigrants were attracted to work in the housing market. Housing starts demanded a large number of workers fill those jobs. As many as 27 percent of them were unauthorized immigrants in some states. Additionally, jobs that indirectly supported the construction of new houses also attracted many lower skilled immigrant workers.
Apprehensions of illegal crossers on the Southwest border (SWB) is a good indication of the size of the unauthorized immigrant flow into the United States. The chart below shows apprehensions on the SWB and housing starts in each quarter:
Fewer housing starts create fewer construction jobs that attract fewer crossings and, therefore, fewer SWB apprehensions. The correlation holds before and after the mid-2006 housing collapse.
What about welfare?
Here is a chart of the national real average TANF benefit level per family of three from 2003 to 2011 (2012 data is unavailable) and SWB apprehensions:
Prior to mid-2006, TANF benefit levels fell while unauthorized immigration rose. During the housing construction boom, unauthorized immigrants were attracted by jobs and not declining TANF benefits. After mid-2006, when housing starts began falling dramatically, real TANF benefit levels and unauthorized immigration both fell at the same time. If unauthorized immigration was primarily incentivized by the real value of welfare benefits, it would have fallen continuously since 2003.
The above chart does not capture the full size of welfare benefits or how rapidly other welfare programs increased beginning in 2008. As economist Casey Mulligan explained in his book The Redistribution Recession, unemployment insurance, food stamps (SNAP), and Medicaid benefits increased in value and duration beginning in mid-2008. Including those would skew welfare benefits upward in 2008 and beyond, but unauthorized immigration inflows still fell during that time.
In conclusion, housing starts incentivize unauthorized immigration while TANF does not.
View full post on Cato @ Liberty
Boeing to slash up to 2300 Seattle jobs
March 23, 2013
US aerospace giant Boeing plans to cut between 2000 and 2300 jobs by the end of the year in the Seattle region as it winds down development of its 787 and 747 aircraft.
About 800 workers of Boeing Commercial Airplanes will be laid off, with the rest of the cutbacks coming through attrition, redeployment and leaving vacant positions unfilled, the company said in an email to AFP on Friday.
"With 787 and 747 development efforts completing and disruption substantially decreasing, we require fewer resources," the company said.
"We will assess employment needs continuously and may need to hire in some areas to ensure we maintain critical skills. We continue to explore all options to lessen the use of layoffs," it said.
The workforce reductions will occur in the Seattle region of Washington state, where the Chicago-based company has its primary aircraft plants.
The job cuts primarily will affect work in post-assembly modification activities on the 787, the cutting edge jetliner that has been grounded worldwide since mid-January due to a battery problem, and on the 747 long-haul aircraft.
The activities, which Boeing calls "change incorporation and refurbishment", come during the development phase of new aeroplanes.
Aeroplanes that are not part of flight testing undergo "change incorporation", meaning they are configured to conform with the standards established as part of the effort to certify the air worthiness of the aircraft.
Aeroplanes used in test flights are refurbished after they complete the flight test activities.
Boeing noted it had already redeployed more than 500 employees since the beginning of 2013.
Boeing delivered its first 787 Dreamliner to All Nippon Airways in September 2011.
Lufthansa took delivery of the first 747-8 Intercontinental, an elongated version of the 747 wide body aircraft, in May 2012.
Statistics: Posted by yoda — Sun Mar 24, 2013 2:42 am
View full post on opinions.caduceusx.com
We’ve written before about what amounts to a “prison industrial complex.” And this is no stretch. In many places prisons are the sole employers, and in many cases they also pay quite well. Many prisons are owned and run by “private” companies with shareholders to satisfy. There are also prison guard unions to satisfy. Locking people up in the United States is big business and we lock up more people per capita than any other nation. More than China. More than Cuba. More than Iran.
A growing profit center for many prisons these days is prisoner labor. Prisoners paid less than a dollar an hour can compete quite well with workers overseas who demand $2 an hour. As a result many companies are “reshoring” jobs to the stony lonesome.
These wages constitute a nice subsidy for both the companies using the prisoners and the prison companies which hold the prisoners which get a cut. A wage of $1 an hour is not real. The cost of locking up that prisoner, feeding him etc, is a lot more than that.
So who pays?
As usual, the taxpayer. And beyond the taxpayer, society at large. To what degree do these profitable jobs (for the prisons and companies) encourage the perpetuation of laws (such as drug laws) which keep prisons filled? We don’t know, but I’ll bet it’s a factor.
However, as Bob Sloan, a prison industries consultant and Executive Director of the Voters Legislative Transparency Project, explains to me, Congress amended the 2011 Continuing Appropriations Act “to allow private companies access to the labor of federal prisoners and UNICOR facilities” under what’s known as the Prison Industries Enhancement Certification Program, or PIECP.“Additionally, the FPI board of directors authorized a ‘repatriation’ program where US companies can bring jobs back to the US making products no longer manufactured in the US,” Sloan tells me. “Prisoners will be paid standard prison wages.”
The post The good news? Jobs are coming back to the USA. The bad? Jobs going to prisoners. appeared first on AgainstCronyCapitalism.org.
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March 9, 2013
Part time work and second jobs increasing while full time work disappearing
A remarkable look inside the employment numbers from yesterday that saw the official unemployment rate drop from 7.9% to 7.7%.
From Market Watch:
According to the household survey (on which the unemployment rate is based), the economy added a healthy 170,000 jobs. The survey also shows a tremendous increase of 446,000 part-time jobs.
What this means is that the economy actually shed 276,000 full-time jobs.
The Bureau of Labor Statistics labeled those 446,000 part-time jobs as "voluntary," but I am not so sure.
A Gallup survey on jobs released Thursday shows the percentage of workers working part time but wanting full-time work was 10.1% in February, an increase from 9.6% in January and the highest rate measured since January 2012.
Gallup notes "Although fewer people are unemployed now than a year ago, they are not migrating to full-time jobs for an employer. In fact, fewer Americans are working full-time for an employer than were doing so a year ago, and more Americans are working part time.
Although part-time work is clearly better than no work at all, these are not the types of good jobs that millions of Americans are still searching for.
Obamacare is in play. Recall that under Obamacare, the definition of full-time employment is 30 hours. The BLS cutoff is 34 hours. At 30 hours, companies gave to pay medical benefits so they have been slashing the number of hours people work. This reduced the number of hours people worked and provided an incentive for many to take on an extra job.
We can see the effect in actual BLS data.
After declining for years, the percentage of those working two or more jobs is again on the rise.
In the past month there was a surge of 679,000 in the number of people working multiple jobs. The seasonally-adjusted increase was 340,000. (Emphasis mine)
James Pethokoukis of AIE has an even gloomier assessment:
2. The labor force participation rate fell again as potential workers stopped looking for work. If the LFP rate was just where it was a year ago, in February 2012, the official unemployment rate would 8.3%. And if the LFP rate was where it was in January 2009, the unemployment rate would be 10.8%. Does the the aging of the US workforce make that 2009 number less relevant? Probably. But have demographics changed that radically over the past 12 months? Doubtful.
3. The February U-6 number, the broadest measure of unemployment and underemployment, was down a tick to 14.3%. This probably gives a better feel for the real state of the labor market.
4. During the past three months, the economy has added an average of 191,000 jobs. At that pace, according to the Jobs Gap calculator from the Hamilton Project, it would take 101 months to return to pre-Great Recession employment levels while also absorbing the people who enter the labor force each month. Oh, and that calculation assumes no recessions between now and late 2021.
With Wall Street at an all time high and businesses enjoying large profits, it is idiotic to say that the employment situation is the result of the financial meltdown and housing crash. These numbers – especially the part time and second job numbers – are a direct result of the policies of this president.
But it is doubtful that the ordinary American will ever realize it.
Statistics: Posted by yoda — Sat Mar 09, 2013 8:59 am
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J.C. Penney Cutting 2,200 Jobs as Sales Plunge
By Sapna Maheshwari – Mar 7, 2013 10:00 PM MT.
.J.C. Penney Co. (JCP) is cutting an additional 2,200 jobs to trim costs as Chief Executive Officer Ron Johnson’s revamp of the department-store chain causes sales to plunge.
The positions to be eliminated include back-office administrators in stores and district offices as well as store leadership positions, Joey Thomas, a spokesman, said in an e- mail yesterday. About 10 percent of J.C. Penney’s 1,100 stores cut their headcounts because of sales volume shifts, he said.
Johnson said last week that 19,000 J.C. Penney employees have lost their jobs in the past year as his turnaround struggles to gain traction. The retailer’s revenue fell 25 percent to $13 billion in the year ended Feb. 2, the lowest since at least 1987. Customers have been alienated by marketing missteps, a failed attempt to transition away from sales and coupons and Johnson’s plan to turn most stores into collections of boutiques.
“As with any reduction in force, we do our best to absorb those impacted into other positions if they choose to do so,” Thomas said. “Impacted team members were given 30 days notice, so their last day would not be effective until April 6. Those who are benefits eligible will receive a severance package and outplacement assistance,” he said.
J.C. Penney rose for the first time in four days, climbing 2.7 percent to $14.82 yesterday at the close in New York. The shares have fallen 25 percent this year through yesterday, after a 44 percent plunge in 2012.
Johnson said on the company’s Feb. 27 earnings call that frequent rumors about job cuts are hard on the retailer’s teams.
“This idea that we’ve got massive headcounts reductions on the way is just really rumored, and we will tactically make changes, but this has been much more rumor than it is fact,” Johnson said on the call in response to a question about workforce reductions.
He mentioned the 19,000 job losses during testimony in New York state court in Manhattan last week as the company defends itself from a lawsuit by Macy’s Inc. (M) over Martha Stewart-branded goods.
Former J.C. Penney CEO Allen Questrom said in a telephone interview March 6 that he was concerned about additional job cuts.
“Penney is an American institution, and people who work there will have their lives affected if they lose their jobs,” Questrom said. “That’s who I worry about.”
The retailer operates about 1,100 stores, according to a Feb. 27 statement. J.C. Penney employed 159,000 people as of January 2012, according to data compiled by Bloomberg.
To contact the reporter on this story: Sapna Maheshwari in New York at email@example.com
To contact the editor responsible for this story: Robin Ajello at firstname.lastname@example.org
Statistics: Posted by DIGGER DAN — Fri Mar 08, 2013 7:49 am
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