By The Old Man Sitting on the Green Bench
How do we get out of the weeds in left field and back in the game? The voter has shown us what they want as an elected representative on the national level, the state level and as often as not on the local level. The resounding answer is they are buying the Republican message of jobs, jobs, jobs. I like James Carville for his economy of words; to me a wonderful line that should ring very loudly to everyone today is — It’s the economy stupid.
OK ??? So if it is the economy, where are we today at the being of new year and a new administration in Washington that has a clear majority and a mandate for change?
If it is about jobs, jobs, jobs then the first stop should looking at unemployment. How often have we heard that unemployment is at record lows (https://fred.stlouisfed.org/series/UNRATE). The latest numbers show a 4.6% civilian unemployment rate which is the lowest its been since the summer of 2001. The problem here is how do we measure the number of people here who are unemployed? I strongly suggest that this measurement can be politically driven to get a desired result. Do you want a rosier picture reduce by definition the number of people unemployed? I suggest that has been done here in Florida often as well as nationally.
Another way to look at the labor market is seen in the Labor Force Participation Rate and the Employment Population Ratio. Population here is working age population (16-65) who can be employed. What we are seeing in Labor Force Participation Rate is that the labor force has grown slightly. However it is still significantly depressed, the current rate of 62.7 was last seen in the spring of 1978. Between then and now the ratio maxed out in the spring of 2000 at 67.3 before retreating to its current level. Another important data set is the Employment Population Ratio which correlates to what we are seeing in the participation rate. This ratio shows that there has been an increase of 1.5% of population over the past several years. Currently the ration is 59.7% of population, which is where we were in the spring of 1984 before the economic expansion centering the spring of 2000.
Here’s an issue when we look at these numbers, the market does not efficiently allocate tasks to be done. A while ago I was in a local outlet for China, Inc. While there I got in a conversation with someone who was restocking the store. In the course of our conversation he told me that he was a CPA but could not find an accounting position. Yes this person was seen as working but certainly way below his capacity. At this point can we agree that the simply said the job market sucks?