Saturday, September 03, 2016
August Unemployment 4.9% - Have We Reached A Plateau ?
The Labor Department has released the unemployment numbers for August, and they show a very troubling trend. The August rate was 4.9%. The report showed that 151,000 new jobs were created, but that didn't even keep up with the number of workers entering the work force (which rose by 176,000).
That makes three months in a row that the rate was 4.9% -- and 12 of the last 13 months that the rate has been between 5.1% and 4.9% (with only May being the exception at 4.7%). They unemployment rate seems to have reached a plateau, and can't get back down to the percentage considered to be full employment (which is about 3%).
Why can't the economy return to full employment. It is because the Republicans don't want that. They want an economy that has millions of desperate people seeking jobs (which keeps wages down for their corporate masters). It also lets them try to blame President Obama -- in the hope that it will let them hang on to power (and maybe even put a Republican in the White House).
The congressional Republicans have imposed a severe austerity through budget cuts, which has taken money out of the economy. They have also killed efforts to fund infrastructure (both repairs and new building), killed veteran jobs bills, killed an effort to take tax breaks away from companies to export good American jobs, refused to raise the minimum wage, and cut subsidies for clean/renewable energy -- all of which would have spurred the economy (creating more demand and more job creation).
The Republicans (and their presidential candidate) have only one "solution" they claim will produce more jobs -- huge new tax cuts for the rich and the corporations. What they ignore is that the tax rate has no effect on job creation. New jobs are created when demand rises, regardless of the tax rate. One of the best periods of growth this country has had was the decade after World War II, when the top tax rate was about 90%. They also ignore the fact that the large corporations are already sitting on trillions of dollars (much of it hidden in overseas accounts to avoid taxes), and they are not using that money to create huge numbers of jobs.
The sad fact is that we will probably be stuck at around 4.9% unemployment until the Republicans are voted out of power, and a fairer and more sensible economic policy is instituted (which the Democrats have been trying to do for years).
Here are the relevant numbers for August:
SIZE OF THE CIVILIAN WORK FORCE:
OFFICIAL NUMBER OF UNEMPLOYED WORKERS:
OFFICIAL UNEMPLOYMENT RATE:
DEMOGRAPHIC BREAKDOWN OF OFFICIAL UNEMPLOYMENT:
No HS diploma...............7.2%
Bachelor's deg. or more...............2.7%
NUMBER OF MARGINALLY-ATTACHED WORKERS UNEMPLOYED (no longer counted because they didn't look for work in the last four weeks):
MORE REALISTIC UNEMPLOYMENT NUMBER (OFFICIAL COUNT + MARGINALLY ATTACHED):
MORE REALISTIC UNEMPLOYMENT RATE:
NUMBER OF UNDEREMPLOYED WORKERS (working part-time because they can't find full-time work):
REALISTIC UNEMPLOYMENT/UNDEREMPLOYMENT RATE: