unemployed workers

Home » unemployed workers

The Sequester

Yesterday, our lawmakers allowed us the privilege of $85 billion worth of spending cuts. Republicans promise that this will help put the United States back on solid fiscal footing. I don’t see it that way. The sequester looks to me like a lot of pain without much, if any, gain.

what is driving the deficit

From CBPP:

The recession battered the budget, driving down tax revenues and swelling outlays for unemployment insurance, food stamps, and other safety net programs.[3] We calculate that changes in the economic outlook since the summer of 2008 account for over $400 billion of the deficit in both 2009 and 2010 and smaller amounts in later years. We estimate that the downturn has pushed up deficits by $2.5 trillion (including the associated interest costs) over the 2009-2018 period.

More from CBPP:

We have slightly revised our estimates of the automatic budget cuts — known as sequestration — scheduled to begin March 1 under the “fiscal cliff” deal reached at the start of the year. The table below lays out what will happen if sequestration, required by the 2011 Budget Control Act, takes effect as scheduled.

The fiscal cliff deal lowered the 2013 sequestration by $24 billion, from $109.3 billion to $85.3 billion. This shrinks the percentage cuts in full-year funding for most programs subject to the automatic cuts. However, the fiscal cliff deal did not affect the Medicare cut, which remains capped at 2 percent.

We need jobs. We don’t need an economic slow down which is exactly what it going to happen. (more…)

By |2013-03-03T21:20:49-04:00March 2nd, 2013|Economy|Comments Off on The Sequester

Sequester, Bob Woodward And Other Craziness

So, we are in the post-sequestered era. What happens now?

Bob Woodward

First of all, let’s deal with the craziness. The Obama administration has been accused of threatening legendary journalist Bob Woodward. I think that this falls into one of the common themes facing Barack Obama – he’s from Chicago. Because Barack Obama’s from Chicago he must be part of the Chicago, “rough-and-tumble” political machine. Yet, we’ve seen no evidence that Barack Obama plays politics this way (well, it may be an overstatement to say that we see no evidence). Personally, I doubt that the Obama administration has threatened any journalist, let alone Bob Woodward. it appears that the truth is that the superficial political website, Politico, is playing this up in order to drive hits to their website. It is probably also true that Bob Woodward is playing this up in order to drive book sales. The fact that he went on Fox News’ Hannity, where the discussion turned from this latest flap to Sean Hannity’s favorite topic, Bill Ayers, says everything that needs to be said.

What has been lost in the sequester flap is that the sequester has started. Across-the-board spending cuts are going into effect starting today. The spending cuts will have real consequences.

From the Center for Budget and Policy Priorities:

  • The roughly 3.8 million long-term unemployed workers receiving federally funded unemployment benefits will face nearly 11 percent cut in their weekly benefits, according to the Administration. This will translate into a cut of roughly $130 per month for jobless workers.
  • As we explain in a new paper, the WIC nutrition program for low-income pregnant women, infants, and young children will have to turn away an estimated 600,000 to 775,000 women and children, including very young children, by the end of this fiscal year.
  • We estimate that more than 100,000 low-income families will likely lose housing vouchers.

More later.

By |2013-03-02T12:31:08-04:00March 1st, 2013|Budget, Party Politics|4 Comments

What happened to the jobs?

The latest jobs numbers have come out. The good news is that we didn’t lose any jobs. The bad news is that we don’t appear to have gained as many as we should have. This is the spending Christmas season.

From EPI:

The labor market remains 7.4 million payroll jobs below where it was at the start of the recession in December 2007, and this number understates the size of the gap in the labor market by failing to take into account the fact that, simply to keep up with the growth in the working-age population, the labor market should have added around 3.6 million jobs in the nearly three years since December 2007. This means the labor market is now roughly 11 million jobs below the level needed to restore the pre-recession unemployment rate (5.0% in December 2007). To achieve the pre-recession unemployment rate in five years, the labor market would have to add nearly 300,000 jobs every month for 60 months in a row. An increase of a mere 39,000, like we saw last month, is just not enough for the 15.1 million unemployed workers of this country.

Earlier this week, the federally funded extended unemployment insurance benefits expired. If they aren’t reinstated, 2 million workers will prematurely lose benefits this month. Importantly, these benefits serve two purposes. First, they provide a lifeline to the unemployed and their families during the deepest and longest downturn since the 1930s. Second, these benefits also boost spending in the economy and therefore generate jobs. The continuation of unemployment insurance extensions through 2011 will create or save around 900,000 full-time-equivalent jobs. With a jobs deficit of 11 million jobs and an unemployment rate of 9.8%, Congress must do the right thing for these workers who lost jobs through no fault of their own and for the health of the overall economy.

MB at DK was very surprised by the numbers. His post solidifies the problems in the jobs numbers. He writes:

Stunned would seem to be the most common reaction to last week’s job report for November. Instead of 160,000 new private-sector jobs that the expert consensus predicted would be announced – with many analysts predicting far more – the Bureau of Labor Statistics said only 50,000 additional private-sector jobs had been created. And, because 11,000 government jobs had been terminated, the net was a paltry 39,000. More than one commentator called that “awful.” And, indeed, it was.

But it was a surprise because there had been a plethora of mostly good news in the run-up to the jobs report, such as here, here, here, here, here, here and here. While many analysts were scratching their heads Friday – even though numerous reports from the Federal Reserve and other sources have been saying ever since the gross domestic product moved into positive territory five quarters ago that job growth could be slow for years with lots of ups and downs month to month – a few took a different approach. (Some people, of course, don’t accept the government’s job tally at all for any month. All those numbers are completely fabricated, they say, starting with the surveys themselves. But that’s another discussion.)

One of the analysts who challenged Friday’s report was Stephen Gandel at Time/CNN’s The Curious Capitalist. Gandel said the BLS missed 350,000 jobs in its November count. Retail jobs made up the bulk of these. The idea that retail hiring was minus 28,000 in November does seem counter-intuitive. This year is the best in the past three years for holiday retail sales, and Black Friday and Cyber-Monday looked encouraging. So how could that sector of the economy be shedding jobs?

By |2010-12-09T13:47:24-04:00December 9th, 2010|Economy|Comments Off on What happened to the jobs?
Go to Top