Posted by: Doug Henwood | March 24, 2017

Fresh audio product

Just posted to my radio archive:

March 23, 2017 Chris Arnade on his travels through the busted heartland of America (Guardian author page) • James Livingston, author of No More Work, on how jobs suck and we should all get free money

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Posted by: Doug Henwood | March 23, 2017

Varieties of unemployment

This is the first in a series of lbo-news posts about the state of the U.S. job market.

On March 10, when the Bureau of Labor Statistics (BLS) released the employment report for February showing a robust job market, Donald Trump finally liked the numbers. His press agent, Sean Spicer, quoted him as saying “They may have been phony in the past, but it’s very real now.” Trump himself retweeted Matt Drudge’s gloss on the news that employers added 235,000 jobs in the month as proof that America was already “GREAT AGAIN.”

That was a remarkable turnabout from as recently as December when Trump said this:

The unemployment number, as you know, is totally fiction. If you look for a job for six months and then you give up, they consider you give up. You just give up. You go home. You say, ‘Darling, I can’t get a job.’ They consider you statistically employed. It’s not the way. But don’t worry about it because it’s going to take care of itself pretty quickly.

Almost none of that is true, but more on that in a moment. A Washington Post review found that Trump claimed the numbers were “cooked” or “phony” at least 19 times since 2012.

When asked to reconcile these strong claims with Trump’s celebration of the latest batch of numbers, which also showed the unemployment rate dropping 0.1 point to 4.7%, Spicer responded with his usual clarity and thoughtfulness:

I think there’s a question between the total number of people that are employed, and the President’s comments in the past have reflected that his big concern was getting to the bottom of how many people are working in this country, and that the denominator—meaning the percentage rate of the total number of people—is not the most accurate reflection of how many people are employed in this country.

How many jobs are created, how many people are getting back to work, how many companies are committing to hiring more people is a much more accurate assessment of where we’re headed as our country—where our employment is, where our economy is headed.

Aside from not knowing what a “denominator” is, not to mention how to express himself in terms that people can actually understand, Spicer also seems to know nothing about how the employment statistics are constructed.

But when I made the requisite fun of Trump and Spicer on social media, several of my left-wing pals also revealed some misunderstandings of the (un)employment stats. In the interest of accuracy, here are a few observations.

The monthly employment report, typically released on the first Friday of the month, is based on two surveys, one of employers and the other of households. The first, known as the Current Employment Statistics (CES) program, or informally as the establishment or payroll survey, covers almost 150,000 businesses and governments representing over 600,000 worksites. It is the source of the headline jobs number (e.g., “Employers added 235,000 jobs in February”), as well as information on hourly earnings and the length of the workweek. The other is known as the Current Population Survey (CPS), which polls about 60,000 households every month; it’s commonly known as the household survey. It asks respondents whether they were employed during the previous month (during the week containing the 12th, to be specific, known as the reference week); if so, at what kind of work; if not, why not, and did they want a job. It also breaks these numbers down by demographic categories like race, sex, age, nativity, and education. Both these surveys have extremely large samples—a typical opinion poll might survey just 1,000 people—which then get translated into national figures. No survey can ever represent the full universe it’s surveying completely, but these are about as good as surveys can get.

February’s gain of 235,000 in the payroll survey was a bit above the average over the last year of 196,000. But there’s just no way the February number was right and earlier ones were wrong—nothing has changed in the way the figures were gathered or processed. And every quarter, the survey results are compared with the near-full coverage of the employment universe provided by the unemployment insurance (UI) system, and the monthly estimates have been within one- or two-tenths of a percent of the definitive UI numbers. Gallup should be so good at predicting elections.

While the household survey also measures employment, it’s most noted as the source of the unemployment rate. Many people, not just Donald Trump, really don’t understand this number at all. It has nothing to do with whether someone is receiving unemployment benefits, for example; fewer than a third of the officially unemployed are getting checks. The count of the unemployed hinges on the answers that respondents give to the CPS. People are counted as unemployed if they didn’t work at all during the reference week, but only if they’ve been actively searching for work. (Work for pay, that is; even the “unemployed” often do plenty of unpaid work.) You need only work an hour to be counted as employed. If you’re not looking for a job, you’re considered to have dropped out of the labor force.

That minimalist definition of employment, along with the requirement that you search for work to be counted as officially jobless, is often criticized as a ridiculously loose standard. It would be if the unemployment rate were meant to be a measure of human deprivation. But it’s not—it’s really a measure of labor market tightness. Employers want to know just how desperate or demanding workers will be. When jobs are easy to find, the help wants higher pay and nicer working conditions; when jobs are hard to find, employees will take whatever the boss wants to shove down their throats. The unemployment rate is a measure of the balance of class forces between capital and labor. People who are neither working nor actively looking for work—who are outside the labor force by the official definition—are near-irrelevant to calculating that balance of forces.

But the BLS also calculates a broader measure of unemployment, one that does a much better job of measuring deprivation. It’s called the U-6 measure, the broadest of the six measures of unemployment that it publishes. (The headline rate is called the U-3. For a history of these measures and detailed explanations, see here.) The U-6 rate includes “discouraged” workers—people who want a job but didn’t search in the last month but did within the last year—and half those who want full-time work but can only find part-time. In February 2017, the U-3 rate was 4.7%, the U-6, 9.2% Here’s a graph of both since 1994, when the current series began.

U-3 and U-6

The graph on the bottom is the ratio of the two rates, along with a line capturing the underlying trend of the volatile monthly numbers. A couple of things stand out from that graph: one is that the ratio falls during recessions (though we only have a sample size of two since 1994), and the other is that it rose during the weak 2002–2007 expansion, as well for most of the recent (also weak) expansion. (The trendline also rose from 1994–1996, the adolescent years of the 1990s expansion.) It rises in expansions because the U-3 unemployed find work more quickly than the U-6 unemployed, and falls in recessions because as people are laid off they join the U-3 ranks, swelling them relative to the U-6. But as an expansion goes on, it finally draws some of the U-6 crowd into the job market.

The ratio fell for several years in the late 1990s, which featured the strongest labor market in a generation. More recently, it started falling in late 2015. One way to read these declines is that it takes a really long expansion to draw in people on the margins of the labor market. A more pessimistic way of reading it is that that only happens as an expansion is approaching the end of its life. One hopes that we’re not in a similar place now.

But let’s return to Sean Spicer, and his word salad around the word “denominator.” It’s likely that what he had in mind was two things called the employment/population ratio (EPOP), the share of the adult (over-16) population in paid employment, and the labor force participation rate, the share of that population either working or looking for work. Those give a much less upbeat picture of the job market than the unemployment rate, as the graph below shows.

LFPR and EPOP

Even though the unemployment rate is close to its 2000 and 2007 lows, both these measures are considerably weaker. The reason is that millions of people have dropped out of the labor force since the Great Recession. Part of the reason for this is that the population is aging; older cohorts are less likely to be in the labor force and older boomers are retiring. But that only explains about half the decline. I’ll have more to say about all this in the next installment of this series.

Posted by: Doug Henwood | March 22, 2017

Never demand.

Matt Bruenig already wrote about this (now deleted) tweet from Paul Waldman, which was a response to one from Bernie Sanders…

Waldman tweet

…and before typing any more, I must confess to feeling guilty about writing a second blog post (god knows there are probably more) about a tweet. But, onwards.

As Bruenig writes, “The difference between Obamacare and AHCA is 24 million uninsured people while the difference between single-payer and Obamacare is 28 million uninsured people.” Obamacare, with all its omissions and cost-shifting, isn’t innocent of monstrousness.

There’s a point about political strategy here worth drawing out here. Waldman, who self-identifies as “Washington Post blogger. Columnist for The Week. Senior Writer at the American Prospect.,” was on the Cabalist, a secret listserv for liberal pundits which I strangely spent two or three years on. (I assume he still is, though I can’t know now that I’m off the thing.) I was invited on, I suppose, for ideological diversity, but left as what most members probably saw as an annoying provocateur.

Waldman’s tweet reflects a consensus on the list that one must never make demands or express ambitious political goals in the way Sanders’ tweet does. All we can do it defend what we have, because the right holds all the cards. I never could convince them that this was a doomed strategy—that, principle aside, if you don’t make big demands you can’t win even small victories, or that without radicals pushing things in threatening ways their wimpy appeals to compromise will have no audience. To your modal Cabalister, to push for single-payer would be to “relitigate” (a favorite word of theirs, reflecting I suspect their preference for litigation over actual politics) Obamacare, and so expose it to repeal. That was their line a couple of years ago, when no one could have imagined President Trump. Now that it is under the threat of repeal, it’s more urgent than ever to assume a defensive crouch.

You can see this sort of thinking behind the Democrats’ responses to Trump. They’re still stuck in the Hillary mode of treating him as an anomaly, something different from a “normal” Republican. They obsess about his alleged Russia ties, but offer nothing as a serious alternative to the Trump (or Ryan) agenda.

Obamacare has never been so popular now that it may go away. Millions of people have gotten something good out of it, as flawed as it is. Imagine how popular a program that offered everyone full coverage would be.

Posted by: Doug Henwood | March 22, 2017

How unpopular is Trump?

Trump’s low approval ratings have gotten notice, but the closer you look the worse they are. At the risk of engaging in wild psychoanalysis, this must be very hard on a pathological narcissist, assuming he’s been fully briefed on the issue.

Here’s a graph of the history of Gallup’s presidential approval question. They started asking the question—“Do you approve or disapprove of the way X is handling his job as president?”—in 1942. But timing was patchy at first, and didn’t approach a monthly schedule until around 1950. Polling has been daily since Obama took office (who, by the way, spent almost all of his time below the average line).

Presidential approval

Trump was at 40% on March 21, up from a low of 37% three days earlier. (That’s the dot on the right end of the graph. Daily updates here.) His average for March so far, 41%, is at the 13th percentile of monthly readings since 1950 (meaning that in only 13% of all months since January 1950 has a president’s approval rating been lower). It’s 12 points below the average of the 67-year history shown.

More remarkably, March is only Trump’s second full month in office. The average for his predecessors’ ratings for their first two full months in office is 64%; Trump is 24 points below that average, and 15 points below the previous basement-dweller, Bill Clinton. Trump is well-practiced at the art of the honeymoon, but that experience isn’t carrying over to the presidency.

As satisfying as this information is, it’s not clear what can be done with it. It’s sometimes said that approval ratings affect a president’s ability to get things through Congress, but Trump is an unusual president and Congress is controlled by reactionary loons. Together the two branches don’t yet look like a well-oiled machine. Perhaps that will change. But Trump’s unpopularity does argue against reading him as the true expression of a toxic American inner essence. We’ve got problems, but we’re not quite that bad.

Posted by: Doug Henwood | March 16, 2017

Fresh audio product

Just posted to my radio archive:

March 16, 2017 Steffie Woolhandler of Physicians for a National Health Program on Ryancare, Obamacare, and the prospects for single-payer • Cinzia Arruzza on the women’s strike

 

Posted by: Doug Henwood | March 9, 2017

Fresh audio product

Just added to my radio archive:

March 9, 2017 Yanis Varoufakis back on BtN for the first time in over two years! He discusses the interminable eurocrisis, austerity, Brexit, the nationalist international (Trump, Le Pen, etc.), and DiEM25, among other things. The full Varoufakis–Ali–et al. debate is here.

The version of this show that ran on KPFA was truncated because the station is fundraising. Please donate and keep this worthy enterprise going. If you do, please mention Behind the News!

Posted by: Doug Henwood | March 2, 2017

Fresh audio product

Just added to my radio archive:

March 2, 2017 Mark Blyth on neoliberalism and global Trumpism (the Guardian/Observer article on Mercer and Cambridge Analytica he talks about is here)

The version of this show that ran on KPFA was truncated because the station is fundraising. Please donate and keep this worthy enterprise going. If you do, please mention Behind the News!

Posted by: Doug Henwood | February 23, 2017

Fresh audio product

Just added to my radio archive:

February 23, 2017 Angela Nagle, author of this and the forthcoming Kill All Normies, on the alt-right •  Laleh Khalili on Lt. Gen. H.R. McMaster, Trump’s new national security advisor

This show didn’t run on KPFA because the station is fundraising. Please donate and keep this worthy enterprise going. If you do, please mention Behind the News!

Posted by: Doug Henwood | February 16, 2017

Fresh audio product

Just added to my radio archive:

February 16, 2017 Sean Guillory (author of this) on the rich history of Western Russophobia • Larry Bartels, co-author of Democracy for Realistson the prospects for democracy with a detached, ill-informed electorate

Posted by: Doug Henwood | February 9, 2017

Fresh audio product

Just added to my radio archive:

February 9, 2017 John Ackerman on Trump and Mexico • Art Goldhammer surveys the French political landscape as a presidential election approaches

Posted by: Doug Henwood | February 9, 2017

Strikes?

The strike—labor’s most powerful weapon against capital, except maybe sabotage—is disappearing even more rapidly than unions, which is saying a lot. The Bureau of Labor Statistics reported this morning that there were 15 work stoppages involving 1,000 or more workers in 2016. That’s 1 above the average of the past five years, and down 96% from the average of the late 1940 and 1950s.

(Stoppages include both strikes and lockouts—the data series doesn’t distinguish between the two. The overwhelming majority are strikes. Notable exceptions in recent years have been in professional sports, but in a bizarrely hostile and destructive move, Long Island University locked out its employees in September 2016. From here on, I’m using the word “strike” rather than stoppage because it sounds far better with only a minor loss of accuracy.)

As the graph below shows, the collapse in the strike began in the late 1970s, and accelerated during the Reagan years, a time of massive union-busting. It’s continued to drift lower as it approaches the zero line. The last time we saw over 50 strikes was 1989. The last time we saw over 20 was 2008.

strikes-to-2016

This decline is even more impressive—or distressing, if you prefer—when you consider that employment has more than tripled since 1950. That is brought out by another series from the BLS, days of “idleness” (a nicely Victorian word, as if striking was a leisure activity) as a percent of total working time. (See graph below.) Even at its peak in 1959, at a mere 0.43%, idleness was never that big a thing, but in every year since 2009, it’s been statistically indistinguishable from 0.

idleness-to-2016

It’s wonderful to hear people talking lately about a general strike and a women’s strike. It would also be good to see some of the old-fashioned kind too. Employers hate them, because they disrupt production, raise wages, cut into profits, and remind them of the potential power of labor. When I wrote up the 2013 data in April 2014, I ended the post with this:

Jane McAlevey, the ace labor organizer and author of Raising Expectations (And Raising Hell)says that her mentor, Jerry Brown of 1199 New England, used to say that workers should strike at least once every two years just to remind them of their power. Those were the days.

With the labor movement about to face an unprecedented attack by every level of Republican-dominated government (not that the Dems have been all that supportive, but this is going to be a whole new kind of hell), it’s alarming to see the working class so out of practice at deploying its most potent weapon.

Posted by: Doug Henwood | February 2, 2017

Fresh audio product

Just added to my radio archive:

February 2, 2017 Mae Ngai and Avi Chomsky(separately) on Trump’s immigration decree • Joel Whitney, author of Finkson the CIA, the cultural Cold War, and particularly the Paris Review

Posted by: Doug Henwood | January 27, 2017

Unions continue to fade

After four years of relative stability, union membership resumed its decline in 2016, with overall and private sector membership at record lows, and public sector membership continuing to tumble. The glum story is told by the graph below.

Stats released Thursday by the Bureau of Labor Statistics (BLS) show that 10.7% of wage and salary workers were union members in 2016, down 0.4 point from 2015. Union density (the term of art) fell 0.3 point to 6.4% in the private sector, and 0.8 in the public, to 34.4%.

Overall density is the lowest ever, as is private sector density, which is less than half its 1930 level, before the great organizing drives of that decade got going. And thanks to the likes of Wisconsin Gov. Scott Walker, public sector density, down four of the last five years, is back to where it was almost 40 years ago.

Perhaps I’m old-fashioned, but I find it hard to imagine a better society without better unions to help lead the way. With AFL-CIO president Richard Trumka and a bunch of union presidents genuflecting towards Donald Trump, even as a federal assault on organized labor in the coming years looks inevitable, it looks like they’re helping legitimate a far worse one.

union-density-2016

sources: 1930–1999, Barry T. Hirsch and David A. Macpherson; 2000–2016, BLS

Posted by: Doug Henwood | January 26, 2017

Fresh audio product

Just added to my radio archive (date is link to show):

January 26, 2017 Asad Haider, author of this, on the problems of “white privilege” discourse • Lucinda Rosenfeld, author of the new novel Classon race and class in the world of Brooklyn public schools

Posted by: Doug Henwood | January 23, 2017

Federal employment is already frozen

This morning, chief bloviator Donald Trump issued an executive order freezing federal hiring. Such a move probably appeals to those who think that the growth of government is “out of control.” That might be true in some senses—surveillance and the warfare state certainly qualify, but Trump only wants accelerate their growth. But one thing that doesn’t qualify is the subject of the order: federal employment.

Graphed below are federal employment in thousands and as a percentage of total employment, from the Bureau of Labor Statistics’ monthly survey of employers. The absolute number of federal employees at the end of 2016 (2.804 million) is actually slightly below what it was 20 years earlier (2.839 million) and 40 years earlier (2.850 million). During the Obama years, federal employment grew by a whopping 29,000 workers. Measured as a percentage of overall employment, the federal sector has been in a steady decline, from a peak of 5.3% in 1952 to 1.9% now. It was 2.1% when Obama took office.

No doubt this will matter little to the bloviators. But it’s true.

fed-empl

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