By Hugh, who is a long-time commenter at Naked Capitalism. Originally published at Corrente.
The Bureau of Labor Statistics announced a 386,000 adjustment to its 2012 jobs figures, putting Obama in positive (+125,000) jobs territory for the first time in his Administration. This will no doubt make for good cheering material for the Obama campaign, but it rather misses the larger and far more important point that we still have a jobs deficit since the January 2008 jobs peak of nearly 11 million. That positive 125,000 is achieved by ignoring two major factors: job losses in 2008 before Obama became President (recessions are impolitic and don’t wait for Presidential Inaugurations to begin) and 4 1/2 years of population growth in the labor age population.
The Obama story runs something like this. When Obama took office in January 2009, employment (jobs) stood at 133.561 million. Job numbers fell 4.317 million to a low of 129.244 million in February 2010. Since then they recovered to 133.300 million in August. Add in the 386,000 from the latest announced adjustment (which won’t be officially added to this year’s tally until February of next year) and you get 133.686 million. That gives us the 125,000 jobs more than when he started, or 4.442 million from the February 2010 trough. As we are 30 months out from the trough, that yields a job creation rate of 148,000/month.
It’s a good story as far as it goes, but that isn’t very far. Indeed it is so incomplete as to be meaningless. Obama came to office halfway down the cliff of job losses. Between January 2008 (with jobs peaking at 138.023 million) and January 2009 (133.561 million) when Obama assumed office, the economy lost 4.462 million jobs. When Obama assumed the Presidency, he did not just take on the responsibility for those job losses which occurred on his watch but all of them. As I said at the start, recessions do not wait on the convenience of Presidents. Neither do Presidents get to pick and choose which parts of a recession they wish to own. Obama’s story touches none of the 2008 job losses.
A common problem with all these stories that start at point X and eventually after much wandering return us back to it is that all the time this journey is taking place, our population is growing. Jobs are covered in the Establishment survey, but we can use data from the Household survey (people) to estimate how many jobs are needed to keep up with population growth in the working age labor population (also known as the non-institutional population over 16). From January 2008 to August 2012, the last month for which we have data, the non-institutional population over 16 increased by 10.950 million. Multiplying this by the average of the employment-population ratio over this period (59.4) gives us our estimate of jobs needed to keep up with population growth: 6.504 million.
Add the uncounted 2008 part of the cliff and jobs needed just for population growth and credit Obama with his net 125,000 jobs and you arrive at a jobs deficit from January 2008 through August 2012 of 10.837 million. This is the size of the story that the BLS announcement doesn’t tell.
And perhaps I am piling on here but if we apply population growth to Obama’s Presidency his small jobs surplus quickly turns into a jobs deficit. Looking at his time in office, the non-insitutional population over 16 increased by 8.827 million and the average of the employment-population ratios was 58.7 or a figure of 5.181 million needed to keep up with population growth. Applying Obama’s 125,000 jobs surplus to this still leaves us with a jobs deficit of 5.056 million for his time in office alone.
Context is everything and so easily overlooked. 5 million for Obama to date. Nearly 11 million to take us back to a situation similar to January 2008. But even this is not the end of the story because January 2008 was a peak but a peak after 8 years of crappy job growth. And during those 8 years the population did not stop growing either. Nor did the number of people who would have worked if jobs had been available to them. Finally, beyond the numbers, there is the question: what kind of jobs? What kind of jobs have been lost? What kind of jobs have been created?
It is a lot to keep in mind, but when we forget all these levels of context, it is precisely then that a miniscule fluctuation in the data can be portrayed as a great victory and significant change.
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Excellent! This is the sort of reporting of employment numbers that needs to be done on Prime Time TV. Kill the Big Lie technique that everything is just fine.
And this is not even considering underemployment.
I have never had a clear picture of the jobs situation in the early 2000s; it seems that every person working P/T as a realtor was included in labor stats, and the numbers seemed squishy — I never had much confidence that the numbers were accurate.
Meanwhile, something that would actually help would be to hire more demographers and other skilled employees onto the government payroll, so they could better collect and analyze the data.
But of course, in the current ‘government-can’t-ever-do-anything-right’ era, that would be anathema.
The idea that people should actually go out and do jobs really pisses me off at a fundamental level. Personally I really hate work, but more than that I really, really hate seeing these corrupt politicians and banksters explaining how they plan to get more people working, as if that were a actually worthy goal to aim for.
What we need is less work and less consumption. Not more. And if peak oil doesn’t do a good enough job of ruining this profligate jobs-based market economy that burns through the earth’s irreplaceable life and natural resources as if they are disposable trash, then the ever increasing levels of automation and artificial intelligence operating within the economy surely will. This is the end of jobs, and they ain’t never coming back.
So, get some hand tools, get a garden, and get used to not having paid employment. But look on the bright side: at least you’ll be able to live like human beings again.
Well said…But as for the getting used to it…There are millions of people who will go to their graves unable to comprehend, and nevermind accept, this truth…Could even be billions I suppose. I cannot properly estimate the penetration of the dogma of the western industrial paradigm globally. I do bet that most Americans will choke on the idea…And personally my own father’s inability in this regard is a daily source of pain.
I have always felt this focus on jobs to be misplaced. As a kid I hated every job I could get and as an adult I found every job I ever had (all four of them) an insult and a waste of time and energy. At age 32 I realized I would never find a job worth having and stopped looking for one. My second wife found this disturbing and left me. I missed her for about six months then forgot her completely. It took nearly a year to create what looked like a business but didn’t make money, but meanwhile I discovered how little money I needed to simply live. I also realized that work was not so bad when the boss was myself. I figured out what skills I had that could be useful to others and put them to work without bells and whistles. It was pointless and probably illegal for me to advertise, so the only customers I got were those who heard about me from somebody else. I had lots of free time and used it to do things I hadn’t done in years but thoroughly enjoyed. For five years I barely stayed ahead of the landlord but in ten years I had saved enough to quit working when my peculiar end of the legal service business was eliminated by counterproductive legislation. A critic could say, well, you were a lawyer with all those advantages. True enough, but I know plenty of lawyers who starve since almost nobody who needs a lawyer can afford one. What anyone needs to do to support himself is reduce his consumption as much as possible and stay in the game long enough to get lucky. More people than anyone thinks are able to do this, which is one reason why those depressing employment numbers are not the whole story. If things are to change in America we must shake loose of the idea that people need jobs. A job is dependence on The Man, and The Man makes very nasty terms. To anyone who finds himself unemployed, figure out what you can do and find a way to do it. Those legendary Job Creators have moved on to work their magic in Vietnam and Cambodia, Manilla, Sinapore, Bangaladesh. They aren’t coming back for you, and shlepping around from interview to interview isn’t doing anything for your mental or physical health. Note to LS: go ahead and moderate this comment. I am now saving copies.
Jake, you just summed up a chunk of my world view. (I even have the law degree, too). The difference is that it’s easier to be female, if this is how you see things – as long as you don’t have the lamentably common urge to reproduce. To my amazement, it turned out that my husband didn’t especially want me to work. Or have kids. He gets better food and more attention this way. He’s a workaholic. I do volunteer, and am extremely frugal. We’ve been together for 26 years now, so I guess it’s sustainable.
Ladies, consider this. Do you really want to have kids? Or do you simply want to get the hell out of the workforce, and having a kid is an excuse?? If you really want a kid, fine. But if not, your husband may not mind your not working anyway. You never know. OINK – one income, no kids. It’s easier on the planet, and leaves free a job for someone who really needs one.
Doesn’t two people living off one income primarily work if the income earner has enough job security to risk it and is making enough to support two people? A lot of people have neither luxury.
You don’t need a large salary *if you don’t have kids.* Two adults can live on a small salary and save pretty easily. Plenty of people don’t want to live that way – fair enough. I hate work enough that I’m willing to be frugal in ways that people avoid by having a second salary. I’m probably the only person in my condo complex who doesn’t hire a house cleaning service – imagine that!! (I’m being snarky, but it’s true). Our car is a 1996 Civic. And so on.
Re job insecurity: of course the non-earning spouse has to be willing to work if things go south for the first one’s job. Given that only a workaholic is likely to want to support a nonworking wife without children, that’s less likely to happen than you might think.
I should add that I am all for women working. Just not me. And I guess I should add that of course men should have this option, but alas I’ve never met a woman who wanted to support a man economically.
My parents find this peculiar (all the women in my family have always worked, whether they needed to or not), but hey, my husband (age 52) and I (age 49) cost them nothing. Whereas my brother (50) and his wife (44) are big money sinks, even though both have jobs that are secure and pay well – there was the fancy wedding, the 100k in adoption costs, the swimming pool repairs, etc. etc. etc.
In many cases, hand tools and a garden are not a realistic proposition if you live in an apartment in the city, the closest planting dirt you’ll find or have is plant pot or an empty lot with garbage and animal poop if it isn’t fenced off. Should these people go to Woodstock?
Spending 40 hours a week plus at work being miserable is a drag. It’s also madness.
In our political and economic system, madness for many is preferable to living in a homeless shelter.
There’s a lot of propaganda propagated by white collar laborers themselves that extol the virtues of being happy at work. The good worker is the worker that devotes nearly all his/her time to the Job.
Great article! Thanks Hugh (and Lambert)
“Homo economicus was surreptitiously taken as the emblem and analogue for all living beings. A mechanistic anthropomorphism has gained currency. Bacteria are imagined to mimic “economic” behavior and to engage in internecine competition for the scarce oxygen available in their environment. A cosmic struggle among ever more complex forms of life has become the anthropic foundational myth of the scientific age.”
― Ivan Illich
In this age of robotics now doing a variety of tasks better than humans, the best solution to the jobs problem is birth control. The alternative favored by the religious right appears to be war, pestilence and famine. What a disconnect from the Sermon on the Mount!
From John Cage’s Lecture on The Weather:
” Our leaders promise they will solve the unemployment problem: they will give everyone a job. It would be more in the spirit of Yankee ingenuity, more American, to find a way to get all the work done that needs to be done without anyone’s lifting a finger. Our leaders are concerned with inflation and insufficient cash. Money, however, is credit, and credit is confidence. We have lost confidence in one another. We could regain it tomorrow by simply changing our minds.”
circa 1974 – deflation/inflation but lost confidence either way. A better system of human organization is needed altogether – not more grinding jobs to prop up this failure.
“what kind of jobs? What kind of jobs have been lost? What kind of jobs have been created?”
Exactly, Yves. One of the stories that has stuck with me through all of this was that of a law school graduate waiting tables. Is this really the direction we are going in as a country?
I bet that if you went back to the early 1980s and told economists back then the economic changes that would take place through 2010 (union busting, low taxes, enormous growth in international trade, etc), they’d tell you employment would be 100%. Didn’t quite work out that way, did it?
Economists are paid to lie. Surplussing labor is the goal, and state managed capitalism fills tge demand vacuum.
Why would a society organize itself in a manner that is so destructive of its majority?
Tenor of comment threads this Sat AM on NC:
Beware the Jobberstats, my son!
The jaws that bite, the claws that catch!
Beware the ‘Bama Bird, and shun
The frumious Laborscratch!
Haha!
Top notch!
What kind of jobs does our ruined economy create? Piss-poor service sector jobs, temp work, and the like. Jobs with low pay, few benefits. The precariat are capitalism’s latest contribution to our society..how can we ever repay our capitalist rulers?
Anyone know of a guillotine maker?
There’s significant growth in the collections and foreclosure clean up business.
Answer one or both.
1. Which is worse, getting pissed off or getting pissed on?
2. Which one are you?
“Anyone know of a guillotine maker?” Sorry, the ARTISANS who made those were among the first people to lose their jobs when the beloved Industrial Revolution began.
As a long time lurker, I just wanted to say that Hugh’s astute comments are among the numerous reasons I read this blog every day. It’s terrific to see him posting here now and then. I hope we’ll be seeing more of his work!
I am too afraid (financially) to ever have kids. I’m thinking of saving money as if I was going to have them, and then if I happen to find myself 70+ years old and still in possession of that money, I’ll start a tiny scholarship or something.
“A common problem with all these stories that start at point X and eventually after much wandering return us back to it is that all the time this journey is taking place, our population is growing.”
Read more at http://www.nakedcapitalism.com/2012/09/o-frabjous-day-callooh-callay-a-jobs-story.html#x8bYtpcqKVw6hKRK.99
Here’s a simple solution. MAYBE OUR POPULATION NEEDS TO STOP GROWING.
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