Time-lapse map of unemployment rates by U.S. county during recession
cohort11.americanobserver.net
cohort11.americanobserver.net
"Perpetual misery" might be a caustic, but appropriate, description. (Spent much of my life in them.)
The units are the real issue here. If they'd set the top bracket at 20%, this chart would be ho-hum. You'd have some splashes of color in Detroit, the Rust Belt, and Central California, and most of the country would be a moderate yellow or orange.
Deeply interesting nonetheless. Is there some expectation of recovery hidden within the spatial graph?
I don't mean whether each individual was benefiting from the income from his or her job. Collectively, were the jobs a net benefit or drag on the rest of us?
Unsurprisingly, the difference in education was enormous. It's not too large a logical jump to say that some of the existing unskilled jobs were waiting for automated replacement.
Well, that's one of two options I'm pondering. The other is that the economy's split into a very literate, "wired", and economically-stable educated class, and a second "unwired" and economically-unstable class. I don't want to say illiterate as much as doesn't-read-terribly-much: television news, product information from salespeople, etc. People who phone or walk in for customer service, use cash and other forms of nonelectronic payment, shop nearly exclusively at brick-and-mortar stores, etc. Essentially, an entire, nearly-closed economy of people who both want human interaction for business and work as the human actors for the businesses that hire them. If we look at the economy through this dichotomy, it appears only one of the two fell.
These unskilled laborers were let go not because they didn't provide value, but because in lean times customers are willing to accept the inconvenience. They weren't and probably won't be replaced by automation. When the economy is strong again, customers will complain about such inconveniences and WalMart will be aggressively hiring again.
Imagine that the economy of every country in the world is a lake. The depth of the hole in which the water resides is roughly proportional to the population of a country, and the amount of water inside the hole is roughly proportional to the average persons quality of life in that country.
America has a relatively high water mark compared to the rest of the world. When America opened trade with China, we essentially dug a hole between our lake and their lake. Because China's lake has such a low water mark, water from our lake (jobs basically) will flow to their lake until their lake and our lake are roughly at equilibrium. Same goes for India and the rest of the world we trade with globally. The lowest water (lowest paying, lowest education req jobs) flows over first, which is why lots of the manufacturing and call center type jobs went overseas first. The current downturn was likely caused by things not related to this flow, but as the recession makes its way through the economy it increases the flow as companies look for ways to cut costs.
I would further the analogy but I don't really have time. End result is: More education = less likely to lose your job. What sector of the economy you are in has little to do with your actual job security.
While I think their worldview is fundamentally flawed, there are a lot of them, they're increasingly angry, and they vote. Just because they're on the internet doesn't mean they have the same kind of enthusiasm for technical progress that we do, far from it.
The elderly?
That said, the double whammy that we take on a lot of jobs is pretty interesting. Clearly a non trivial number of Americans have jobs that are net losses for them individually, since they use credit card debt to get by, and net losses for the larger economy since access to credit provided by the financial markets is the only thing that makes their paychecks clear.
It makes you wonder, if access to credit were to dry up tomorrow, what would that look like? Who would still have a job?
I don't know, it's just interesting brainstorm material.
The financial industry in particular is filled with incredibly brilliant people who spend their days trying to figure out how to outsmart each other, the government, and the public at large instead of inventing things that make peoples' lives better. Wall Street could easily support another dozen Googles or so, but rather than organize the world's information, they prefer to use it to siphon off the world's money.
Output is still down on a year ago, so it's not like productivity has gone up and all those jobs were examples of inefficiency.
Unless you want to throw in on the heating bill?
However, that doesn't mean the work those people are performing for that income is actually necessary to anyone else. The question is: through easy and cheap credit, was the economy paying a bunch of paychecks to some people in exchange for unnecessary labor?
If I hire a guy to dig a hole in the morning and fill up the hole in the afternoon, the guy I hired very well may need his job, but his job isn't anything anyone needs done. When my line of credit runs out, I'm going to lay that guy off. The question is: how much of the economy pre-recession consisted of people getting paid for more convoluted but equally unproductive labor?
Perhaps a better metaphor: if I hire a guy to do all my long division, when my line of credit runs out, I'm going to lay that guy off and buy a calculator. How much of the economy consisted of (often unionized) long-dividers running their employers into bankruptcy until their employers had to buy calculators?
An economy has to produce wealth to survive, not just distribute it to people in exchange for mere effort.
"But if, on the other hand, you come to the conclusion, as is too often the case, that it is a good thing to break windows, that it causes money to circulate, and that the encouragement of industry in general will be the result of it, you will oblige me to call out, "Stop there! Your theory is confined to that which is seen; it takes no account of that which is not seen."
It is not seen that as our shopkeeper has spent six francs upon one thing, he cannot spend them upon another. It is not seen that if he had not had a window to replace, he would, perhaps, have replaced his old shoes, or added another book to his library. In short, he would have employed his six francs in some way which this accident has prevented.
Let us take a view of industry in general, as affected by this circumstance. The window being broken, the glazier's trade is encouraged to the amount of six francs: this is that which is seen.
If the window had not been broken, the shoemaker's trade (or some other) would have been encouraged to the amount of six francs: this is that which is not seen." - Frederic Bastiat
Did we jump from 8.5 in September to 10.2 in October? That seems excessive.
Seems like the vermin come out to play when the economy is bad.
Funny/sad part is that he got this lead from a posting on my college's alumni jobs system.
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