Thinking About Jobs On Labor Day
Continuing the third world
transformation of the US labor force established by the
Bush recovery, the new payroll jobs are concentrated in
nontradable services. Health care and social
assistance account for 42,000 of the new jobs.
Employment services and temporary help provided work for
18,000, as did financial services.
Construction added 15,000 workers to payrolls. These
four payroll classifications account for 78% of last
month`s net new jobs.
Manufacturing jobs increased by
22,000, leaving the economy with a net loss of 2.7
million manufacturing jobs since Bush was sworn in as
Today`s economy has 4,000 fewer
jobs in architectural and engineering services and
200,000 fewer jobs in computer systems design and
related than in January 2001.
America`s continuing decline as a
manufacturing power is further evidenced by a decrease
in total manufacturing hours worked during almost three
years of economic recovery–a first according to
Charles McMillion of
MBG Information Services.
McMillion notes that total hours
worked for all non-supervisory jobs has not increased
over the economic recovery. In contrast, past recoveries
experienced growth in hours worked by 5-12%.
Let`s get real: neither employment
growth nor growth in consumer income is driving the
current recovery. July`s increase in personal spending
was financed by a drop in the savings rate to 0.6% of
Face it: the current recovery has
been driven by the Federal Reserve`s low interest rates,
which have driven up housing prices, allowing people to
refinance their homes and to spend their home equity.
Both households and government alike are loaded with
At least the Census Bureau is not
in denial: according to a
recent report, the number of Americans living in
poverty increased by 1.3 million during 2003. The number
of Americans without health insurance rose by 1.4
million to 45 million.
It`s a fact: Americans are not
prospering. When US companies
locate manufacturing abroad, where costs are lower,
and outsource high value-added jobs to foreigners, who
can be hired for less, foreigners, executives and
shareholders gain income at the expense of the US labor
Stagnant real income growth in the
US results from the loss of career occupations to
outsourcing, forcing many Americans into less
remunerative employment, while executive pay explodes.
Standard & Poor`s reports that in
2003 the median earnings growth for the Fortune 500
largest companies was 9.6%, but median pay for Fortune
500 CEOs rose 22%.
Prosperity only for the few
undermines Americans` political tolerance for
the rich. This is especially the case when the
traditional ladders of upward mobility are lost to
outsourcing and offshore production.
According to William McDonough,
chairman of the Accounting Oversight Board, in the bad
old days of
President Reagan`s “trickle-down economics,”
the average Fortune 500 CEO made 40 times more than the
average person who worked for him . . . "By 2000, it
was between 400 and 500 times, and last year I believe
it was about 530 times.
What will bring executive pay under control?,
By Adrian Michaels, August 23 2004
Pity the policymaker who attempts
to make a case for across-the-board tax cuts in the face
of such politically explosive economic inequality.
Nothing can better revive the
American political left than the loss of good
American jobs to foreigners while executive pay
skyrockets–particularly if the two are closely related.
One might expect that conservative “free market”
economists would be alarmed. Instead, they either turn a
deaf ear or shoot the messenger.
Recently, Steve Roach, chief
economist at Morgan Stanley, wrote: “Economists,
market strategists, and even analysts are all too often
becoming identified with a political cause; that is a
disturbing development–it has the potential to
compromise credibility and leave investors without the
security of independent advice.”
Mr. Roach could just as well have
said that the politicization of economic analysis leaves
presidents and legislatures with no awareness of the
true consequences of their actions. “You are with us
or against us” means no market for independent
thought and no hearing for independent advice.
Paul Craig Roberts is the author with Lawrence M.
The Tyranny of Good Intentions : How Prosecutors and
Bureaucrats Are Trampling the Constitution in the Name