Saturday, January 18, 2014

Is Unemployment High? No.

Historically, unemployment has always hovered at about 5-10%.  Today's unemployment rates are not really abnormal.

We hear about it all the time in the media.  The economy is rotten.  People are being foreclosed upon.  Unemployment is high.  Profits are down and the stock market is doing horribly.   The world is going to hell in a handbasket.

Well, actually not.  Sorry.

The stock market is at an all-time high, yet again, and profits are doing well, for many companies.  Sure, J.C. Penny and Sears are in the tank.   Why are they in business, again?   Why didn't they just throw in the towel two years ago?   There are always going to be obsolete companies going out of business.  New ones take their place.  And in the case of J.C. Penny and Sears, it is likely Amazon and Wal-Mart.

But I digress.

Unemployment rates are another number bandied about as "bad" when in fact, they are pretty much normal today, particularly compared to the rates in 2009, which hovered near 10%.   Since then, unemployment rates have dropped.

The media, always looking for a cloud in the silver lining, opines that "many have dropped out of the job market" which is why unemployment rates are down.

Excuse me, did I miss something?  Dropped out of the job market?   How exactly does one do that, and where do I sign up?  Because, sheesh, if I could just not work and still get paid, that sounds like a good gig to me.

Of course, what they mean by this is twofold.  First, we have people at or near retirement age who decide to stop working and retire.   But that doesn't mean they won't collect that 99 weeks of unemployment, first.   CNN ran a sob-story (do they run any other kind) about a woman who was 67 years old and was "laid off" and "couldn't find a job" as a receptionist or file clerk (both job descriptions are pretty much obsolete and have been replaced by computers).   She is old enough to collect Social Security and a Pension.  So she did - but not after she ran through her "unemployment" checks first.   You can't blame her, I guess.  The government throws money at you, you catch it, right?

Others might "drop out" because they were not really looking in the first place.   A spouse goes back to work, part-time and then loses their job.   They decide to go back to being a housewife or househusband.  They didn't so much "drop out" of the job market as made different choices.

But few people, I suspect, are "just getting discouraged and stopped looking" - as most of us need money to survive and thus don't have a "choice" about working.

But in any economy, there will always be unemployed - about 5% at least.   Some are people laid off when the factory closes and are looking for new work - and eventually find it.   These are the transient unemployed.   There are also seasonal workers (like construction workers) who may be laid off in the winter and collect unemployment.  Usually seasonal workers are excluded from unemployment statistics.

But still others are what you might call the slacker-class.   These are the folks whose resume reads "six months here, a year there, maybe two years somewhere else."   Chances are, you know someone like this, or had to work with them.  They usually smoke pot and will tell you how their old boss was a jerk and the company was "all screwed up" and they have endless excuses why it is not their fault they were laid off, fired, or quit, six times in five years.

This latter kind of person will always be in and out of that 5%, and the longer they play that game, the harder they will find it to get and keep a job.   A resume that is peppered with short-term employment is never going to sell to a potential employer.

Jesus said, "The poor will always be among us" - and so will the unemployed.   It is nothing to be alarmed or worried about.