Archive for the ‘Government’ Category
Let’s start with the big one. The piece of data that would sway the electorate one way or the other in the upcoming elections, determining once and for all which party knows best when it comes to job creation. That’s right: we’re talking the final monthly jobs report prior to the mid-terms. In political punditry, it doesn’t get much more fevered than that—especially when the best you’ve got to on otherwise is speculation over whether one of the candidates happens to be a witch.
As with most regular events that get a fevered build-up (New Year’s, anyone?), the announcement just had to fail to live up to expectations—and it surely did, with the economy leaking just enough jobs to ensure that the overall number came in at an unchanged 9.6 percent. Politically, that’s the worst outcome either party could have hoped for: the failure to get the expected rise to 9.7 percent leaves Republicans without an easy case to make when it comes to accusing Democrats of job-killing policies, while the fact that things haven’t improved means the Democrats can’t claim to have figured out anything approaching a solution either.
(Incidentally, a recent Vault poll found that the public is more or less aware of that: when asked which party was most likely to make a difference to the unemployment crisis, the number of respondents who plumped for one side or the other came to less than 50 percent combined. That compares to 38 percent who stated that the two parties need to work together, with the remainder suggesting that government should get out of the way altogether and just let business get on with it.)
By far the most interesting employment-related number of the week came from the Pew Economic Policy Group, which found that a record 30 percent of unemployed Americans had been out of work for at least in August. And it gets worse: the technical definition of “long-term unemployed” is someone who’s been out of work for over 6 months. In August, 71 percent of the “long-term unemployed” had been out of work for at least a year—dating their layoffs back to some of the darkest days of the recession. The risk, of course, is that the longer someone is out of work, the harder it is for them to find a new position—especially if the type of job that person did isn’t likely to return. That scenario gave rise to perhaps the most depressing sentence of the week, courtesy of USA Today (emphasis added): ” Many of the long-term unemployed will struggle to find work even after the job market picks up, and some will never work again.”
Things don’t look much rosier when considering the major hiring announcements from the past week, either; notwithstanding the announcement that Kohl’s is hiring 40,000 seasonal workers, any other significant announcements of new opportunities tended to be in overseas markets.
It’s unlikely that we’ll see much improvement in the job market before the elections take place at the end of the month, but at least there’s one thing to be thankful for: the attempted politicization of the unemployment number should die down, at least for the foreseeable future.
If one thing has become clear over the last week, it’s that the road to the midterm election is going to be a long, long, slog—especially for those of us who have set up alerts for the words “economy” and “jobs” in Google Reader and.
In case you somehow missed it, the biggest thing that happened to the world of jobs this week is that President Obama came out swinging as he attempts to save the Democratic majority in the House come November. Accordingly, almost everything he said throughout the week was tailored towards the issues that voters are most concerned about right now. Don’t know what that is? Here’s a clue: starts with “j”, ends in “obs.”
Mindful of the tarnished reputation of Stimulus I, the President was careful to avoid the term when rolling out his latest plan to, uh, stimulate the economy. His new plan has three main prongs, with each designed to spur hiring and investment in the economy: infrastructure spending, a 100 percent tax break for companies on new investments in plant and equipment, and increasing the budget for an R&D tax credit while also making it permanent. Oh, and there was also something about “holding the middle class hostage” that didn’t get any press attention at all.
Outside of Washington, one of the biggest hiring stories of the week turned out to not be much of a story at all. There we were all breathless with excitement over the news that Spanish bank Santander was hiring 6,000 in the UK. There was speculation on what it could possibly mean in terms of their plans for expansion (the company only has 22,000 employees in the UK).. And then there was another announcement: the company is hiring a mere 600 employees. Typos, eh?
Compounding the bad news for the finance industry was the prediction from Wall Street analyst Meredith Whitney that some 50,000 jobs related to the securities industry could be at risk. Her reasoning: that ” underwriting and advisory fees account for around 80 per cent of investment banks’ revenues and those areas have suffered badly.”
It was a bad week for those in aerospace and defense contracting as well: BAE Systems, Boeing and Lockheed Martin all announced layoffs, with tightened spending at the Pentagon prompting the firms to cut costs.
Elsewhere, it was another better-than-expected week for new jobless claims, with further “good” news to be found in the fact that there are now only five jobless workers for every open position. Woeful as that figure sounds, it’s a significant improvement from just a few months ago, when it was as high as six per opening.
There’s fresh hope on the horizon regarding that number as well: the birth rate appears to be among the many things negatively affected by the economy. All we need to do is hold on for a generation or so, and there will be more jobs than people. Right?
Employment-related news hasn’t been difficult to come by this week; the fevered speculation over the August jobs report made sure of that. As it turned out, the report was neither as good or as bad as feared: a loss of 54,000 jobs overall was offset by the fact that the private sector increased hiring by 67,000. And, with the overall rate climbing only slightly to 9.6 percent, the abiding concern now seems to be stagnation. Or to put it another way: employers aren’t laying off anymore, but they don’t seem to be hiring either.
That reality is reflected not only by the flat response to Vault’s job seeker sentiment poll, but also in the postings on the Employment Tracker this week. Sure, there’s news of a major restructuring at JAL—with the airline cutting 16,000 jobs–but that event stands out precisely because it’s no longer the norm.
A look at the hiring news on the tracker seems to confirm the thesis that hiring is stuck too. While there are some fifteen reports of firms seeking to add employees, collectively they will add less than 15,000 jobs to the economy—and that doesn’t factor in the fact that many of the positions are in international markets, or that the biggest U.S.-based announcement came from the government, which is seeking 1,700 cybersecurity pros.
If that isn’t indication enough of the kind of difficulty the economy is seeing, check out the following chart from The New York Times’ Economix blog. It compares this recession to previous ones in terms of percentage of jobs lost (left axis) over the duration of the recession (bottom axis). As you can see from the chart, we’re definitely in unfamiliar territory—and bottoming out to boot.
With all of that in mind, perhaps the most telling story of the week—and certainly the most unusual—has nothing to do with unemployment figures or projections of where the economy might go next. Rather, it’s the slightly absurd news that the Irish agency tasked with job promotion was forced to lay off staff as part of the government’s efforts to balance its budget.
All told, then: lots of talk about the unemployment number, but very little action.
–Phil Stott, Vault.com
If you haven’t read the news lately, the phrase on the lips of every politician, pundit and pollster is still “jobs.” Now, however, the debate has shifted to the necessity of unemployment benefit extensions, with some suggesting that continued funding of jobless citizens only breeds laziness and complacency. As if being out-of-work wasn’t bad enough, America’s unemployed find themselves as a two-sided token for political debate, either martyred as faceless victims of economic turmoil or vilified as shiftless layabouts.
The result has been an increasing number of disparaging public remarks from political figures, most of whom assume the worst about jobless professionals’ circumstances. The foremost example of this came in a recent editorial by pundit and former game show host Ben Stein, wherein he opined that those still without jobs perhaps deserve it:
“The people who have been laid off and cannot find work are generally people with poor work habits and poor personalities. I say ‘generally’ because there are exceptions. But in general, as I survey the ranks of those who are unemployed, I see people who have overbearing and unpleasant personalities and/or who do not know how to do a day’s work. They are people who create either little utility or negative utility on the job.”
Similar assertions have been made by former House Majority Leader Tom Delay, who claimed in a CNN interview to know of studies “that show that people stay on unemployment compensation, and they don’t look for a job until two or three weeks before they know the benefits are going to run out.” Ron Johnson, a U.S. Senate candidate in Wisconsin, echoed Delay’s sentiment during a public television interview: “When you continue to extend unemployment benefits, people really don’t have the incentive to go take other jobs. They’ll just wait the system out … Then they’ll go out and take probably not as high paying jobs as they’d like to take.” Johnson advised, “That’s really how you have to get back to work. You have to take the work that’s available at the wage rates that’s available.”
In the spirit of fairness in the face of these allegations, I’ve offered an opportunity for rebuttal to one such unemployed citizen: Joe the Computer Operator. At age 51, Joe handled systems administration for a chemical company until three years ago, when he was laid off and saw his job outsourced. Without a source of income, he says, “I had to move in with a friend because I could no longer pay my rent.” Joe states he will “send out hundreds of resumes,” but “99 percent of the time I do not get any response.”
So what does Joe say about Delay and Johnson’s comments? Quite simply, “I do not agree.” “I have continued to look for work while I was receiving my unemployment benefits. I am sure that some do not look for a job while collecting benefits but I feel the majority of us want to work and do look for employment.” Of particular note was Johnson’s “take the work that’s available” remark, to which Joe retorts, “It is easy for someone to say ‘You should take a minimum wage job,’ but then when I ask ‘Well, how do I pay my bills and survive while making $8 an hour?’ they never have an answer. The math just doesn’t add up.”
At Ben Stein’s descriptions of “poor work habits” and “unpleasant personalities,” Joe bristles, “This sounds like profiling and discrimination to me. Just once I would like to see a dope like this have to walk in the long-term unemployed shoes. The bottom line is that there are no jobs—just look at the numbers. We can’t all have poor personalities and bad work habits, can we, Stein?”
For Joe, meanwhile, the search for work continues. “I am sending out my resume today for a Computer Operator position I found on one the many job boards I receive daily email alerts for. Maybe I will get a positive response from this one, but I doubt it.” Discouraged words, to be sure. But after seeing the insensitivity toward unemployed professionals like Joe, it’s not hard to understand the frustration.
Okay, so the week kicked off with the news that companies aren’t hiring despite holding record amounts of cash. And, yes, by the end of the week it had become apparent that the reluctance to spend money had also taken hold of consumers, slowing the recovery. But, really, those are no reasons to despair.
On a more optimistic note, there were at least a few decent hiring-related pieces of news over the past week:
- President Obama brought the issue of hiring people with disabilities firmly into the spotlight. He ordered federal agencies to hire 100,000 employees with disabilities. Oh…and in a TV appearance almost no one noticed this week, he also pointed out that the auto industry has added back 55,000 jobs this year.
- The New York economy needs office workers, at least according to the Wall Street Journal, which reported that “while there are ongoing layoffs in certain areas related to mergers and restructuring, major firms are hiring in the areas of accounting, compliance, and systems development.”
- Where would we be without Google? (Probably not reading this, that’s for sure.) Not only has the company added a couple of thousand jobs this year, it announced plans to continue hiring for the rest of the year.
- Nomura. Wow. What else is there to say about a bank that “offered jobs to 40 students at triple the normal starting salary under a new plan to strengthen its international business.” And is planning to hire 560 more graduates in the near future. No word on whether those jobs are likely to be in Japan, though. (We suspect they are.)
- It’s not exactly C-suite stuff, but it sure sounds like you won’t ever be too far from a sandwich: Panera Bread announced plans to hire 25,000 workers. That’s all over the country, not in one store. We hope.