# US recovery?



## sags (May 15, 2010)

A pretty bleak "employment" picture is developing in the US.

A "jobless" recovery.........say some.

92 million eligible to work Americans..........aren't working.

Only 62.8% participation in the workforce.

The lowest number since 1978.

Not good news at all.

Check out the charts.

http://www.zerohedge.com/news/2014-...million-participation-rate-plunges-1978-level


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## Nemo2 (Mar 1, 2012)

Hope & Change.


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## Causalien (Apr 4, 2009)

They gained 72k jobs while we lost 45k jobs. Who are we to talk down on them. If you normalize for population. In USA terms, we lost 450k jobs in december 2013 alone and about 600k of that are permanent jobs. Which means that window dressing of 150k temp job gains made the stats looked less bad. Is anyone alarmed yet?


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## Nemo2 (Mar 1, 2012)

Causalien said:


> They gained 72k jobs while we lost 45k jobs. Who are we to talk down on them. If you normalize for population. In USA terms, we lost 450k jobs in december 2013 alone and about 600k of that are permanent jobs. Which means that window dressing of 150k temp job gains made the stats looked less bad. Is anyone alarmed yet?


Different job count.......the US is currently way worse than it is shown to be....see Sags' link.


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## gibor365 (Apr 1, 2011)

Nemo2 said:


> Different job count.......the US is currently way worse than it is shown to be....see Sags' link.


So QE is alive and well  and rates gonna be low much longer ?!


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## HaroldCrump (Jun 10, 2009)

Nemo2 said:


> Hope & Change.


+ 100, LOL
Also hidden in the details is that there were exactly zero jobs created in health care and social services.
In fact, it lost 1,000 jobs.
Gee, I wonder why :rolleyes2:


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## james4beach (Nov 15, 2012)

In both countries it's really an issue of the types of jobs and quality of jobs that are being created.

Good quality jobs would be permanent full time, especially in the professional fields... that's the kind of backdrop a family needs to do activities like buying a home and building a family.

There's been very poor creation of those kinds of jobs. Instead there's been a lot of new lower paying jobs, contract work, temporary etc. It makes for good employment reports but really doesn't help the economy become robust.


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## Causalien (Apr 4, 2009)

Nemo2 said:


> Different job count.......the US is currently way worse than it is shown to be....see Sags' link.


Yeah I read it. The argument has been there about labor force participation since 2009. I have stopped buying it. I mean, it could be that people are retiring. In any case, the truth almost lies somewhere in between. US economy has been going to ****/recovery at the same time. I don't know how that is possible but that's what it looks like. Business is booming, but the gov is slipping in capital control under the carpet while the population gets distracted by some artificial problem. If they don't plan on pulling the rug from under at one point, why slip in the hidden capital control. 

Yesterday I just learned that I couldn't ship two round metal copper through UPS or USPS because it is considered coin/currency. Should've said memorabilia. I recommend to those who are moving to USA in the near future. To regularly transfer 50% of your pay back to a Canadian bank USD account. Something fishy is going on.


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## Nemo2 (Mar 1, 2012)

Causalien said:


> US economy has been going to *****/recovery** at the same time.


* Actuality.

** Propaganda/Manipulation.


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## richard (Jun 20, 2013)

Recovery in what? Government finances? Jobs? Average standards of living? Corporate profits? Frontier spirit?  The economy is a pretty big thing so you'll need to be more specific.

With regards to the labor participation rate I ran across a similar chart recently and started thinking about it. It seems like there were steep increases in the 70s and 80s and the modest increases in the 90s. After all that what goes up must come down. Just an idea but maybe a lot of new people started working decades ago which expanded the economy, and then once things settled down companies started to figure out they could use more technology to get better profit margins. A lot of things are changing and it won't benefit everyone.


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## OptsyEagle (Nov 29, 2009)

sags said:


> 92 million eligible to work Americans..........aren't working.
> 
> Only 62.8% participation in the workforce.
> 
> The lowest number since 1978.


Well, let's look at this through some rosier glasses. Many of those 37.2% of American's not working would be retirees, who in 1978 would most likely have been dead at the same age. So lets not compare 1978 apples to 2013 oranges.

2ndly, in 1978 we didn't have dollar stores and Ebay and Kijiji, allowing the frugal to live on almost nothing, giving them a lot less incentive to look for a job. Today, many American's simply do not need to work, who in 1978, did.

Lastly, those 72K jobs, most likely went directly to people who really needed a job, and will immediately start spending those earnings within the economy. Since the labour force dropped, it tells me that the people who were looking for work previously, simply to fill in some spare time, who didn't really need the money and probably would have just saved the money anyways, went away. 

I mean, people do not just get to choose to leave the workforce. You either need the money and need a job and keep looking until you get one, or die, or you do not need the money and can decide to drop out of the workforce. Am I missing another category of workers, here?


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## Causalien (Apr 4, 2009)

richard said:


> Recovery in what? Government finances? Jobs? Average standards of living? Corporate profits? Frontier spirit?  The economy is a pretty big thing so you'll need to be more specific.
> 
> With regards to the labor participation rate I ran across a similar chart recently and started thinking about it. It seems like there were steep increases in the 70s and 80s and the modest increases in the 90s. After all that what goes up must come down. Just an idea but maybe a lot of new people started working decades ago which expanded the economy, and then once things settled down companies started to figure out they could use more technology to get better profit margins. A lot of things are changing and it won't benefit everyone.


Recovery in corporate profits. That's the metric I look at.

Workers are going to be replaced with robots. That's my specialty and that's what I see the manufacturing industry moving towards. What are those people going to do? I have no idea, but we as a society will figure something out, if not. Famine/disease/war is the historic norm. I think this is why Japan and America is war mongering and looking for a fight.


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## Nemo2 (Mar 1, 2012)

http://milescorak.com/2012/05/04/th...unemployment-rates-is-bigger-than-it-appears/



> The US makes a distinction between job search activities that involve “active” measures (activities that on their own could lead to a job offer), as opposed to “passive” measures (activities that require some additional effort to obtain an actual job offer).
> 
> Placing or answering a job ad, visiting employment agencies or businesses, making job inquiries and sending applications as well as attending interviews are all examples of active search methods. Asking family and friends for jobs or leads is also considered an active measure.
> 
> ...


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## gibor365 (Apr 1, 2011)

Causalien said:


> Recovery in corporate profits. That's the metric I look at.
> 
> Workers are going to be replaced with robots. That's my specialty and that's what I see the manufacturing industry moving towards. .


I don't agree! Workers are going to be replaced by Indian "workers" offshore. I work in IT Financial company and this is what I see this industry moving forward


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## richard (Jun 20, 2013)

gibor said:


> I don't agree! Workers are going to be replaced by Indian "workers" offshore. I work in IT Financial company and this is what I see this industry moving forward


That's the first step of cutting labor costs while keeping the same structure. A lot of businesses may find they can change their structure altogether to get even better improvements. If they use less labor and more technology, and a mistake from a worker can have bigger costs because it screws up all the machines and all the other vendors and customers they're working with that depend on everything going right every day because they're in a JIT supply chain, does that lead to more offshoring?


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## james4beach (Nov 15, 2012)

This is probably the kind of "recovery" where everyone is going to get laid off, while their company stocks go up. That's certainly what's been happening within my circles.


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## HaroldCrump (Jun 10, 2009)

The entire effect of Q/E has been to disconnect the financial markets from the reality of the economy.

At a time when 91 M workers have been completely discounted out from the statistics (the labor participation rate), about 11 M are on disability, and about 2 M (belonging to certain racial and ethnic groups) have been thrown into prison using fallacious excuses under an Orwellian style police state, there is no real economy and no real recovery anymore.

The idea of Q/E is to disconnect reality from financial markets so that it can function on its own, without having to depend on the real economy - pesky things such as jobs, consumer spending, productivity, and other real metrics.

In a recent interview with Bloomberg, Jim Rickards said something like : _When we will have 310M workers drop out of the labor force, 50 without jobs, and 1,000 people employed, the unemployment rate will be 5% and the Fed will declare its job done._


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## sags (May 15, 2010)

Causalien is right about Canada having concerns of our own,........I think.

Garth Turner rounded up some Canadian economy facts on his blog today, and we are heading in the wrong direction.

http://www.greaterfool.ca/

And then I wonder about the "bitcoin" frenzy. Despite all kinds of bad news, people are still buying at $960 each.

Perhaps it is a last gasp attempt to "partake of the wealth", by people desperate for some hope. 

Sort of like.........what is it around 30% of people..........who are counting on a lottery win for their retirement.

Signs of our times perhaps.


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## richard (Jun 20, 2013)

james4beach said:


> This is probably the kind of "recovery" where everyone is going to get laid off, while their company stocks go up. That's certainly what's been happening within my circles.


The majority of people in North America get some kind of benefits from the stock market, directly or indirectly (just think of every pension plan not to mention government plans like the CPP). Marx has won!



HaroldCrump said:


> At a time when 91 M workers have been completely discounted out from the statistics (the labor participation rate), about 11 M are on disability, and about 2 M (belonging to certain racial and ethnic groups) have been thrown into prison using fallacious excuses under an Orwellian style police state, there is no real economy and no real recovery anymore.
> 
> In a recent interview with Bloomberg, Jim Rickards said something like : _When we will have 310M workers drop out of the labor force, 50 without jobs, and 1,000 people employed, the unemployment rate will be 5% and the Fed will declare its job done._


What is the correct labor participation rate?


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## james4beach (Nov 15, 2012)

richard said:


> The majority of people in North America get some kind of benefits from the stock market, directly or indirectly (just think of every pension plan not to mention government plans like the CPP). Marx has won!


Well excellent, because once we're all laid off and the young people can't find work, we'll all just watch the stock market go up and "get rich".

Right?


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## richard (Jun 20, 2013)

james4beach said:


> Well excellent, because once we're all laid off and the young people can't find work, we'll all just watch the stock market go up and "get rich".


It turned out that when you divide it up between everyone we don't get all that much. Still, better than millions of people starving.


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## james4beach (Nov 15, 2012)

Lots of great hopes for the stock market, isn't there?

CPP depends on the stock market to provide retirement for everyone.
Boomers need a high stock market to live off/cash out and survive retirement.
Young people need a strong stock market since they can't find jobs but stocks will save them
Everyone earns too little income... but don't worry, the stock market will make us whole!

lol... not gonna happen guys... plan for the worst, hope for the best. IMHO


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## CadMan (Apr 16, 2010)

Gosh, this is the most depressing doom and gloom thread I've stumbled across in a while.


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## HaroldCrump (Jun 10, 2009)

richard said:


> What is the correct labor participation rate?


Higher than the lowest in 35 years.


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## Siwash (Sep 1, 2013)

"Only 62.8% participation in the workforce."

Seems to me like a lot of people don't want to "participate" - there are a lot of entitled lazy asses out there who can't bring themselves to working a "modest" job… maybe we should discourage people from attaining useless degrees (like psychology degrees) and lower our expectations… are we all entitled to 100K per year? I don't think so… 

I personally know several under 30 year olds who refuse to take retail jobs b/c their too good for it… so, instead, they stay at home and collect EI and live with mommy and daddy who pay for their cell phones, internet and car insurance… 

North America is imploding. This will not end well..


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## richard (Jun 20, 2013)

HaroldCrump said:


> Higher than the lowest in 35 years.


In 2000 the US had the highest labor participation rate in at least 60 years. Maybe the highest rate ever, if you can find a long enough chart. This is the best I can find: http://en.wikipedia.org/wiki/File:US_Labor_Participation_Rate_1948-2011_by_gender.svg. Are you saying that since it was unusually high in 2000 that was also bad? Just like unemployment rates or inflation have a target range and a deviation on either side will harm enough people to slow down the economy. Just to take one example if everyone was working full-time from 18 to 65 when would education happen?


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## richard (Jun 20, 2013)

CadMan said:


> Gosh, this is the most depressing doom and gloom thread I've stumbled across in a while.


Invent any story and you can find real statistics to make it sound credible. It works both ways


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## richard (Jun 20, 2013)

Siwash said:


> "Only 62.8% participation in the workforce."
> 
> Seems to me like a lot of people don't want to "participate" - there are a lot of entitled lazy asses out there who can't bring themselves to working a "modest" job… maybe we should discourage people from attaining useless degrees (like psychology degrees) and lower our expectations… are we all entitled to 100K per year? I don't think so…
> 
> ...


If we don't know where we want to be, how do we know we're in the wrong place? Something that's often overlooked is that despite the decline in manufacturing jobs, North American manufacturing output has increased steadily. If we just don't need as many workers, then what? Some people might be quite content to settle for less. Of course when they run out of easy options they might change their minds and take a low-income job.


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## HaroldCrump (Jun 10, 2009)

richard said:


> Are you saying that since it was unusually high in 2000 that was also bad?


No, I am saying that the current rate is too low and not healthy for the economy.
There are way too many people out of work, for way too long (for a variety of reasons, including disability, imprisonment, etc.)
If this is the best level that the US can sustain, then a lot of expectations and assumptions will have to be reset.



> Just to take one example if everyone was working full-time from 18 to 65 when would education happen?


You are putting words in my mouth.
No one is saying that every country should be a labor camp (because that is what you are implying).
The current levels of labor force participation, wage growth, and income disparity does not indicate a recovery.
It indicates a _depression_.
The massive amounts of Q/E and ZIRP also indicate a depression, not a recovery.


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## james4beach (Nov 15, 2012)

HaroldCrump said:


> The current levels of labor force participation, wage growth, and income disparity does not indicate a recovery.
> It indicates a _depression_.
> The massive amounts of Q/E and ZIRP also indicate a depression, not a recovery.


I agree. Prolonged ZIRP is one sign of how poor the economy is; the fact that Canada will soon be cutting rates to join USA at ZIRP shows how poorly we're doing too.

When you enter a ZIRP policy you don't do it because things are booming. It's an emergency measure when you're out of options. The USA has been in emergency mode for 6 years straight now.

Also don't forget that 1/6th of the US population is on food stamps.


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## My Own Advisor (Sep 24, 2012)

"Also don't forget that 1/6th of the US population is on food stamps."

Insane when you think about it...in a scary way. 

I have to worry what really happens, when, the QE-pumping-money-into-the-machine stops.


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## sags (May 15, 2010)

To conclude the problem is that people don't want to work, even in low income jobs........ignores a lot of evidence besides the employment "participation" rate. 

A NY union had 1500 people lined up for 3 days in the bitter cold.......for job interviews for a handful of openings paying 17.20 per hour as painting and decorating apprenticeships........that "might" lead to full time jobs.

http://www.zerohedge.com/news/2014-...new-yorkers-camp-out-three-days-1720-hour-job

Cap spending by corporations has been low for a long time. Corporate polls show that executives don't expect to expand their workforce.

The trade deficit for Canada is 9 times worse than economists expected. We are selling and shipping diddly squat, beyond raw commodities.

Commodity prices are in decline. Wheat prices are down. Canola prices are down. Oil prices are down. Potash prices are down.

I don't know how anyone can view the litany of statistics with any sense of contentment.

It is bad.........and when housing prices start to decline........it will affect everyone,..........working or not.


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## richard (Jun 20, 2013)

HaroldCrump said:


> No, I am saying that the current rate is too low and not healthy for the economy.
> There are way too many people out of work, for way too long (for a variety of reasons, including disability, imprisonment, etc.)
> If this is the best level that the US can sustain, then a lot of expectations and assumptions will have to be reset.
> 
> ...


So a 63% participation is too low (apparently not in the past when it worked out fine, but it is now) and 100% is too high - can be we more specific? Does the economy need 1000 new jobs, 1m, 10m, or 100m? That's a pretty wide range and the answer would affect a lot of things.

If a recovery means going back to the past - like the 60s, which were apparently pretty nice but had a lower labor participation rate - then that will never happen. We are going towards something different from what we have now. Maybe it's not all bad. Considering that even with large income disparities most people live with AC... how far to you have to go back to find the majority of people living with less than the lower end today?

Coincidentally I just finished reading Tyler Cowen's latest book which has a lot of data and predictions that are closely related to this. I won't give it away but some entirely acceptable ways of handling the pressures might be very surprising to many people in North America today. I don't know if it's half true but it certainly expanded my perspective.


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## HaroldCrump (Jun 10, 2009)

richard said:


> If a recovery means going back to the past - like the 60s, which were apparently pretty nice but had a lower labor participation rate


You are comparing against a time when the women's participation rate in the labor force was much, much lower.
The participation rate right now is much worse than the 60s from that perspective.



> So a 63% participation is too low (apparently not in the past when it worked out fine, but it is now) and 100% is too high - can be we more specific? Does the economy need 1000 new jobs, 1m, 10m, or 100m?


All of the above - you need enough jobs such that 50M people are not living on food stamps, 91M not dropped out of the workforce involuntarily, 11M not on LTD involuntarily, and so on.
We didn't have that in the 60s.
Are you seriously saying that the job market is hunky dory?

Keep in mind that many of these so-called jobs being created are temporary part-time, service sector jobs.

Someone else above said that the unemployment rate is high because people don't want to work.
The term used was "lazy asses", I believe.
It is nuts to call 150M people lazy asses.

The poster said that many people do not want to work in low-end service jobs, which is why the unemployment rate is too high.
But the data shows that those are precisely the types of jobs that are getting created and filled.

Another tidbit is that there were less net new jobs created in 2013 than in 2012.
We seem to be regressing, not progressing, when it comes to the labor market.

Also, do not ignore how the Obama administration is constantly extending the duration of unemployment benefits.
This skews the data because all those folks with extended UI benefits get counted as part of the participation rate.
Many (perhaps most) of those on extended UI have given up looking for FT work.
But they are being counted as part of the labor force, not outside.

This is the first time since the Great Depression of the 1930s that a so-called "recovery" is taking 6 years.
There hasn't been a recession in the last 70 years that has required a 6 year "recovery".
This is a depression, being masqueraded as a recession/recovery cycle because of Q/E and ZIRP.

Putting lipstick on a pig thing of thing.

The period from 1929 - 1940 was also a depression, although there were periods of strong stock market rallies, and lots of upbeat optimism around growth and recovery.

I am not saying the US is doomed, of course not.
So if that is the position you are trying to defend, I am not saying that.
But to claim that everything is hunky dory with the labor market sounds misleading, and in fact bizarre, when clearly the conditions point to something entirely different.


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## Nemo2 (Mar 1, 2012)

https://www.youtube.com/watch?feature=player_embedded&v=BNRT0P-oZfw


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## peterk (May 16, 2010)

Well put Harold. And I didn't know about how employment insurance fitted into the stats. Shouldn't those people be counted as _double_ unemployed haha? Not making money AND sucking at the teat...

What a crazy world. I hope the US can pull out of this, but I'm beginning to suspect they may not...

Next book on my reading list is Enjoy the Decline: Accepting and Living with the Death of the United States


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## dogcom (May 23, 2009)

+1 for Harold from me as well.


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## james4beach (Nov 15, 2012)

HaroldCrump said:


> This is the first time since the Great Depression of the 1930s that a so-called "recovery" is taking 6 years.
> There hasn't been a recession in the last 70 years that has required a 6 year "recovery".
> This is a depression, being masqueraded as a recession/recovery cycle because of Q/E and ZIRP.


It can't be a depression, because Bernanke (and the Federal Reserve in general) promised us: "no more depressions"

Acknowledging this is a depression would do irreparable harm to the Federal Reserve and possibly put an end to its mandate. This is the core reason why Bernanke has pulled out all the stops and is doing wild, likely _illegal_ things. They have to make this work or at least create the facade of a non-depression. They are a very desperate, anxious organization.

Great post, Harold


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