With unemployment stuck above 9 percent, Washington is trying to “pivot to jobs” once again. And already the discussion feels tired. The White House’s much-hyped ideas don’t seem bold enough, and Republicans have had little to offer aside from the idea that reducing government regulation will somehow let the free market work its magic.
A range of less conventional ideas for creating jobs can be found beyond the narrow Washington conversation, however. They aren’t necessarily politically correct–but that doesn’t mean they would not be effective. It’s not like anything else we’ve been trying lately has been working.
Here are five of the best so-crazy-they-just-might-work ideas to get the economy back on track.
1. Bulldoze excess housing stock
The struggling housing sector continues to exert a drag on the economy as a whole.
This is Part 1 of a 3 part series about economic myths. Parts 2 and 3 will follow, hopefully this week 🙂
What nonsense that is. The official jobless rate, at 9.7%, is a fiction and should be treated as such. It doesn't even count lots of unemployed people. The so-called "underemployment" or U-6 rate is an improvement: For example it counts discouraged job seekers, and those forced to work part-time because they can't get a full-time job.
That rate right now is 16.6%, just below its recent high and twice the level it was a few years ago.
And even that may not tell the full story. Many people have simply dropped out of the labor force statistics.
Consider, for example, the situation among men of prime working age. An analysis of data at the U.S. Labor Department shows that there are 79 million men in America between the ages of 25 and 65. And nearly 18 million of them, or 22%, are out of work completely. (The rate in the 1950s was less than 10%.) And that doesn't even count those who are working part-time because they can't get full-time work. Add those to the mix and about one in four men of prime working age lacks a full-time job.
Dean Baker, economist at the Center for Economic and Policy Research in Washington, D.C., says the numbers may be even worse than that. His research suggests a growing number of men, especially in deprived, urban and minority neighborhoods, have vanished from the statistical rolls altogether.
The verbiage above tells the right story. The official unemployment rate has always been a poor gauge of the employment picture. Only now, it's worse. I'll try to find data to back it up, but my gut tells me there are a lot of people underemployed (not working full time but who need or want to).
By "underemployed," I also mean that people aren't getting paid what they need to survive. Perhaps you lost your cushy 9 to 5 six-figure banking job and now you're working as a retail store manager (big pay cut there). You're working longer and harder but getting paid significantly less than you had been.
That's underemployed. Yes, you have a job and good for you! But you've certainly had to make some lifestyle changes, wouldn't you say?
A lot of personal finance bloggers would tell you that you should always live the frugal life; that's a great opinion to have and if you walk your talk, you're good to go. However, many people cannot live the way you do.
They are married and are the sole providers of their families. Or they have kids or parents to care for. Obligations that they may have acquired at a younger, less financially-aware age.
No matter. For the average man or woman on the street, having a job that fits their basic lifestyle needs is hard to come by right now. And I don't really see any relief on the horizon.
I will say, though, that lots of times the turn in the business cycle is unseen until it happens right in front of your eyes. That is to say, often times nobody sees it coming. Leading indicators are only so good. As they say, "hindsight is 20-10."
Let me know your thoughts in the comments.
Next up: Deficits are bad
I want to start off this post by saying that I’m sorry I haven’t posted in quite some time.
You see, at the end of July, July 31 to be exact, I was laid off. I knew it was coming as it was part of the transition plan to acquire Washington Mutual by JP Morgan Chase.
So what have I been up to the past few months? At the beginning of August, I took the family on a long vacation (3 weeks) up through Oregon, then west to the Oregon coast, and back down. We stayed at a large ranch, visited Ashland (the Shakespeare Festival), saw my cousins in Junction City near Eugene, then we stayed 5 days in Portland.
Portland is a beautiful city. We took bike rides (that first mile up the trail in Forest Park is a killer, what with me towing a double-wide Chariot bike trailer loaded with my two boys), went to the Children’s Museum and the Portland Zoo, visited Powell’s (a killer bookstore).
Then we went to Astoria (nice coastal city) and stayed a few days. Then we went south, through Gold Beach (the 25 miles south of Gold Beach is the most spectacular coastline I’ve ever seen and I live in California), and many coastal towns between there and my home.
We had a wonderful time.
I am in no mood to look for more work, either. I kind of like staying home. But for now, that’s a big dream I have. October might be the month where I get really serious about a job. I will be looking in the Portland and Seattle areas, though — that’s for sure. Places like REI, Columbia, Yakima, Nike, and a few others come to mind as places I’ll target to find gainful employment.
I’ve let the blog carnivals slip. I kind of dread sifting through all the posts because there’s got to be a ton of them. I most likely will break them up into 5 or 10 bit chunks, just to manage them better and give each post more attention. Sound good?
In the meantime, I’ve got a ton of stuff to do around the house. I’ve reorganized the office closet and have eliminated a lot of clutter (but there’s a lot more). We’re going to be redoing the front patio with tile. We’ll also being laying down some more sod in the front and back yards.
Plus, we’ve got our back yard landscaping plans back. I haven’t even looked at them yet. This is one project where I’ll have to really think about how to chunk it up into much smaller pieces because if I tackle it all together, I will literally kill myself!
Also on my list of to-dos is to install (or have installed) a door in the office that leads to the new back yard.
Boy, have I got a lot of work to do!
I don’t have time to look for a job.
Meanwhile, I am still laying the foundation for my eventual exit from the corporate world. I have redesigned a lot of my sites and hopefully will be able to put a lot of them on semi-autopilot (I have tried “autoblogging” software and I just really don’t like the outcome on anything other than a news blog), so I’ll be posting a lot to my sites:
Computer Monkeys will get a redesign, too (at least the blog will) as well as a lot more posts added.
Photo-dodo is on hiatus. I love photography and took a ton of photos while on vacation, but I just don’t foresee finding the time to devote to the site.
That’s it for now. I hope to make some contributions to this site in the very near future.
By the way, if anybody wants to guest-post, I’m all ears! 🙂
Leave me a comment if you want to make a guest post or two about personal finance (please, no topics other than PF).
Is it really? It sure doesn’t feel like it! (I’m losing my corporate fat-cat job at the end of this month. Yikes!)
No, two of the best and most objective forecasters, who are not connected to investment banks or to the CNBC noise machine, have recently called the upturn. Macroeconomic Advisers, the St. Louis-based consulting firm that compiles a monthly GDP index, reported to its clients Monday that while second-quarter GDP was tracking at negative 0.1 percent (recession), the third quarter was tracking at 2.4 percent growth.
Clearly, employers are not hiring at the pace they normally do in a recession. I have anecdotal evidence from laid off colleagues that makes it crystal clear that employers are not hiring, but here’s solid, statistical proof –
What makes the Great Recession different from all other recent recessions is not mainly the number of workers being laid off. It’s how few workers are being hired.
Read the full story here –Layoffs Aren’t the Main Problem – Economix Blog – NYTimes.com