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Unemployment rate falls below 4%

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  • Liberal Democrat
    Democrat
    Colorado Springs, CO
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    New York Times, May 4, 2018: Unemployment Rate Hits 3.9%, a Rare Low, as Job Market Becomes More Competitive

    The official unemployment rate for April fell to 3.9 percent. That's the lowest since 2000 when the rate also hit 3.9 percent, but you have to go back to 1970 to find a rate lower than 3.9 percent. The last time the unemployment rate remained below 4 percent for a sustained period was in the late 1960s.

    The jobless rate for black workers was 6.6 percent in April, the lowest level on record (Trump touts this number as a victory for him), but still much higher than the 3.6 percent for whites.

    If you include people who had given up looking for work, the unemployment rate is 7.8 percent, a level not seen since 2001.

    164,000 jobs were added in April, falling below the Wall Street economists expectation of about 193,000.

    The numbers , of course, are subject to later refinement and revision as is often the case. The Labor Department revised the job figures for February slightly downward, but revised the numbers for March sharply upward, resulting in a net increase of 30,000 jobs for those two months compared with previous estimates.

    Average earnings rose by 4 cents an hour last month and are up a modest 2.6 percent over the past year. Wage growth is not picking up as one would expect for these historically low unemployment numbers.

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    I will make a few observations on the numbers.

    1. There is wage growth in some sectors but not in others reflecting the disparities and inequalities in the economy both geographically and demographically. We've discussed that in other threads in the past, and in addition to education, age is one of the significant demographics.

    2. The uncertainty of what the Trump's actions including tariffs will do to the economy has many employers moving more cautiously on wage hikes. Some are giving one time bonuses instead of wage hikes.

    3. Globalization is here to stay, and US wages are more and more linked to the competitiveness of the global market. In particular, the strong dollar is hurting global competitiveness. The US dollar is stronger than its been in the last 13 years.

    4. The baby boomer effect is not talked about much (except by me). For the baby boomer generation (those of us born between 1946 and 1964) we are indeed retiring at increasing rates. We can retire and grab our social security benefits as early as age 62 (with reduced benefits), take full retirement benefits at age 66, or work until age 70 for increased benefits. If we wait until 70, our monthly benefit will be 32% higher than it would be at 66 and a staggering 76% higher than it would be at 62.

    So there are definite monetary benefits to delay taking social security benefits until age 70, but nothing beyond age 70. Those of us baby boomers born in 1946 and 1947 have turned 70 either last year or this year. I haven't seen any statistics on the numbers, but it would seem to me that many of those born in those years and who postponed retirement will now be leaving the work force for good. Those numbers are reflected in part in the 3.9 percent unemployment rate.

    Furthermore, as us seniors retire from the work force, we are replaced by younger workers at considerably lower salaries, and that factor can contribute in part to the anomaly of low unemployment but apparent stagnant "average" wages.

    My opinion...

  • Independent
    Ft.myers, FL
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    These numbers don't say much about the health of this country; looking at Trumps program, all of this may end up like as in 1929 because of cutting "regulations" and screwing up "trade agreements" like TPP and NAFTA etc. Also if they erase the Iran nuke deal, it will influence the oil prices etc. Already you are paying more at the pump.

    Thus this "labor" rate may go up in flames; thanks to Trump and his ignorant cronies.

  • Liberal Democrat
    Democrat
    Kenosha, WI
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    Watch for a readjustment by the BLS.
  • Independent
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    Well.

    An increase of 2.6 percent is virtually nothing as inflation is not that different. Trump’s claims of hitting 4% gdp growth will likely not come to fruition. The stock market has been treading water after almost 8 straight years of gains. I look for it to continue treading water at best and more likely drifting downwards. Cutting government R&D budgets for basic research is sure to have negative long term impact on growth as well. Trump and the rw meme of small government ignores the impact of cutting government. We hear rw bleating about cutting regulations and helping small businesses but most small businesses have always failed through history. So cutting regulations means nothing. Cutting government spending negatively impacts small businesses as well as damaging society as a whole. What the right deliberately ignores is the failed theology of the invisible hand as well as shrinking government. The invisible hand, only mentioned once or twice by Smith, fails for several reasons. Among them is ignoring or discounting the impact of money and the financial system. It also ignores the impact of declining profits forcing movement of business thereby depriving the public of bread to use Smith’s famous example of the baker.

    Society and social relations are far too interconnected to be explained by simplistic economic theologies. Growth in general and the idea of infinite, permanent growth is unsustainable. Capitalism must have permanent growth. And growth is nothing more than present use of future debt.

  • Independent
    Ft.myers, FL
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    lonely bird Wrote:

    Well.

    An increase of 2.6 percent is virtually nothing as inflation is not that different. Trump’s claims of hitting 4% gdp growth will likely not come to fruition. The stock market has been treading water after almost 8 straight years of gains. I look for it to continue treading water at best and more likely drifting downwards. Cutting government R&D budgets for basic research is sure to have negative long term impact on growth as well. Trump and the rw meme of small government ignores the impact of cutting government. We hear rw bleating about cutting regulations and helping small businesses but most small businesses have always failed through history. So cutting regulations means nothing. Cutting government spending negatively impacts small businesses as well as damaging society as a whole. What the right deliberately ignores is the failed theology of the invisible hand as well as shrinking government. The invisible hand, only mentioned once or twice by Smith, fails for several reasons. Among them is ignoring or discounting the impact of money and the financial system. It also ignores the impact of declining profits forcing movement of business thereby depriving the public of bread to use Smith’s famous example of the baker.

    Society and social relations are far too interconnected to be explained by simplistic economic theologies. Growth in general and the idea of infinite, permanent growth is unsustainable. Capitalism must have permanent growth. And growth is nothing more than present use of future debt.

    Lonely; most countries fail because of "greed"; capitalism is doomed from the start. It is simple; if you cater only to the rich and "money" and "greed" is your "god" then it is not sustainable; certainly if you also elect the "mob" to run the country.
  • Brooks, AB
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    I have heard that the actual unemployment rate is closer to 15%. Many workers have given up working and finding other means to sustain themselves. I am wondering if the statisticians are able to keep track of those numbers.
  • Liberal Democrat
    Democrat
    Kenosha, WI
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    @ Dave, yes, you have some very valid concerns, that's why I posted earlier to wait/watch for BLS, Bureau of Labor Statistics adjustments.

    In my state (Wisconsin), republican lawmakers are bragging about our low unemployment rate is at or below 2.9%, but, I do not believe it. I think that those statistics might be a bit fudged. Call me a non believer.

    Does the low unemployment rate figure in people who just stopped looking, people working one or two part time jobs, etc., etc., etc..

  • Liberal Democrat
    Democrat
    Colorado Springs, CO
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    That so called real unemployment rate of some 15 percent was the "U-6 rate" back in the heart of the Great Recession. That rate is now 7.8 percent. The U-3 rate is the official number. See the following:

    BLS unemployment rates

  • Independent
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    Schmidt Wrote:

    That so called real unemployment rate of some 15 percent was the "U-6 rate" back in the heart of the Great Recession. That rate is now 7.8 percent. The U-3 rate is the official number. See the following:

    BLS unemployment rates

    And the assumption is that those numbers are accurate, that people do not lie or that they always respond and respond accurately. My guess is unemployment is double digit and basically will be forever.
  • Brooks, AB
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    Another interesting statistic that might shed more light on this issue was created by a study commissioned by the CBC (Canadian Broadcasting Corporation) a few years back. This study said that only 17% of us Canadians were happy with our occupations. The other 83% would prefer to work elsewhere. Most of us are still employed as a means to provide a living, not out of some version of self-actualization.

  • Liberal Democrat
    Democrat
    Kenosha, WI
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    It's Canadian bacon.
  • Liberal Democrat
    Democrat
    Kenosha, WI
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    The economy is soooo good, my spouse has been unemployed for over a month now.

    I just took my car in for service. It won't be done till later this afternoon because the owner/manager of the garage said that he can't get his employees to show up on time every morning.

    Employers across this once great land, there are three prerequisites for employees, 1. walking 2. talking 3. breathing

    The economy is sooooo good, gas prices are up, diesel fuel prices are up, food prices are up, and there's a shortage of employees and employers.

    Steel makers and farmers will get their subsidies though.

    This isn't the USA I once knew, everything is going to hell.

  • Strongly Liberal Democrat
    Democrat
    Pensacola, FL
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    "One organization estimated that in 2015, 13.5% of Americans (43.1 million) lived in poverty. Yet other scholars underscore the number of Americans living in "near-poverty," putting the number at around 100 million"
  • Center Left
    Independent
    Central, FL
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    Under employment is when you have 3 jobs because they all pay far too little to survive. Good or bad news depends on your perspective.
  • Independent
    Ft.myers, FL
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    Chet Ruminski Wrote: "One organization estimated that in 2015, 13.5% of Americans (43.1 million) lived in poverty. Yet other scholars underscore the number of Americans living in "near-poverty," putting the number at around 100 million"
    Chet it was an report from the UN ; indeed 14% as stated, live below the poverty line; Of course the trump administration put this quickly into the garbage bin; the US UN representative made sure this publication did not hit the airwaves and refused to distribute this report. Lying and cheating are the motto of the Trump ruling.