Posts Tagged ‘jobs’

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All three remaining presidential candidates—Donald Trump, Hillary Clinton, and Bernie Sanders—have decried the loss of manufacturing jobs in the United States and have promised, in one way or another, to bring those jobs back.

However, as readers know, I hold no nostalgia for industry or for the supposedly good manufacturing jobs that were the mainstay of the American Dream in the postwar period.

to the extent that manufacturing jobs were “good jobs” (and, in my view, we do need to dispute that idea that they really were “good jobs”), it wasn’t because workers produced real, tangible goods; it’s because the workers were unionized and were able (with the aid of higher real minimum wages, better-financed government supervision of worker safety, and so on) to bargain over their pay and working conditions. They aren’t able to do that now in most of the private-sector service-producing industries. In other words, it’s not what workers produce but under what conditions they produce.

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I continue to believe we need to puncture the myth that all those manufacturing jobs were good jobs. We also need to look at what’s happened with those jobs in recent decades. As you can see from the chart above, while U.S. manufacturing wages (for production and nonsupervisory workers) were higher than the hourly wages for all private-sector workers until a decade ago, they’re now less (by more than a dollar an hour). That’s why, as the National Employment Law Project (pdf) has shown, manufacturing production wages now rank in the bottom half of all jobs in the United States.*

So, Ben Casselman is right:

For all of the glow that surrounds manufacturing jobs in political rhetoric, there is nothing inherently special about them. Some pay well; others don’t. They are not immune from the forces that have led to slow wage growth in other sectors of the economy. When politicians pledge to protect manufacturing jobs, they really mean a certain kind of job: well-paid, long-lasting, with opportunities for advancement.

The problem is, we’re not seeing those kinds of decently paid, secure jobs anywhere across the landscape of the U.S. economy—in manufacturing, services, or anywhere else.

The precipitous decline in unions is one part of the explanation. At a more general level, however, at least as significant (even when unions were stronger) is the fact that workers have little say in the main institutions governing the economy—in the enterprises where they work, the communities in which they live, and the governments they vote for and to which they pay taxes.

Until that changes—until workers are able to participate in making key decisions about their lives and livelihoods—the promise of creating more jobs in one sector or another is merely a pipe dream that is being manufactured to keep things just as they are.

 

*However, while many analysts overlook this, it is still the case that weekly earnings for manufacturing workers (the red line in the chart below) remain higher than those for other workers in the private sector (the blue line):

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jobs

Everyone knows that most of the jobs created during the so-called recovery are not particularly good. Most of them are for very low pay and offer few if any benefits.

Not so, according to the Wall Street Journal:

were all the jobs we created since the recession bad? Well, yes and no. It’s true that many low-wage industries have been growing, many middle-wage industries have shrunk, and more people work part time or for minimum wage than did a decade ago. But it’s also true many middle- and high-wage industries are growing too, and the number of minimum wage and part-time workers has gradually been declining over the past five years.

Well, let’s see, according to the data they themselves provide. But let’s do it not in terms of percentage increases (because, obviously, a high percentage increase on a small basis doesn’t generate a lot of jobs) but, instead, in terms of the total number of employees (in the private sector).

Here’s what we end up with for the top ten economic sub-sectors:

 

Consider that the average weekly pay (in April 2016) for all private-sector workers was $880.79.

Obviously, then, the two largest sub-sectors, in which there has been double-digit growth since December 2007, are Leisure and Hospitality and Food Services and Drinking Places. both of which have weekly earnings less than half the average for the entire private sector. You can add to that pattern of low-wage growth Employment Services and Food and Beverage Stores.

Meanwhile, three sectors that have traditionally paid middle-class wages—Construction, Speciality Trade Contractors, and Durable Goods—have seen declines in the number of jobs since the crash.

So, what are we left with? Hospitals, whose average is inflated by high-earning physicians and managers, which has seen job growth, and Credit Intermediation and Related Activities, which also has a high average, raised by well-compensated brokers and managers, which has actually seen a decline in the total number of jobs.*

The only possible conclusion is, that’s not a mixed picture. The current recovery can only be characterized as follows: the creation of plenty of low-wage jobs, the destruction of many formerly middle-income jobs, and an increase in jobs in one sector characterized by obscene levels of inequality.

Needless to say, workers are justifiably angry about the so-called economic recovery. Therefore, like the crew of the fabled ship, they’d have every right to hang a metaphorical albatross around the necks of the real-life descendants of the Ancyent Marinere.

 

*That just leaves Membership Associations and Organizations—and I have no idea what that is.

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No matter how many stories I tell them about thought control in economics, students and colleagues in other disciplines simply don’t believe me.

They don’t understand the restrictions on the professors who are hired in many economics departments, the narrow range of methods and perspectives published in the leading economics journals, the limits on economics research projects that actually receive funding, and even the strict surveillance of what can be taught to students in basic undergraduate and graduate economics classes. It’s beyond their imagination that mainstream economists do all they can—within their departments and in the wider discipline—to make sure other approaches (often referred to as heterodox economics and, often, noneconomics) are displaced to (and, in many cases, beyond) the margins.

So, it comes as no surprise to me—but it probably does to everyone outside of economics—that a senior lecture rat the University of Glasgow, Alberto Paloni [ht: sm], an expert in post-Keynesian theory, has been stopped from teaching a core degree module on macroeconomics.

This, after an essay in the Royal Economic Society newsletter specifically cited Paloni’s course as introducing a necessary pluralism into the teaching of economics:

Examples of courses that successfully incorporate pluralist approaches to teaching economics already exist. For instance, the second year macroeconomics course at Glasgow University acknowledges the existence of alternative perspectives within economics and gives students the tools to contrast the standard macroeconomic theory with post-Keynesian economics. Students are made aware of how different perspectives employ different approaches and reach different conclusions, and asks them to evaluate critically how well theories explain empirical evidence. . .In contrast to Glasgow, most macroeconomics courses teach from a single textbook and teach students to solve problems within models as opposed to comparing different types of models and seeing which generate more credible conclusions.

All Paloni did was teach students some Post Keynesian macroeconomics. Post Keynesian theory, for those who are unfamiliar with the term, focuses on elements of the economic approach inspired by John Maynard Keynes (such as time, radical uncertainty, financial fragility, and so on) that are often domesticated by or simply removed from modern mainstream macroeconomics. Nothing too radical, then—just one among many alternatives to the theory that prevails in economics and, as we now know, the set of approaches and policies got us into the current mess.

Fortunately, the students in the Glasgow University Real World Economics Society decided not to take the decision lying down. So, they initiated a petition that received over 150 signatures and was then passed on to the heads of the Department of Economics and the Adam Smith Business School, respectively, as well as to the Principal of the University of Glasgow.

Here are some excerpts from their petition:

It is with great dismay that we are writing this.

It has recently been decided by the Economics Department at our university to remove Dr Alberto Paloni from teaching the course Economics 2B. . .

Economics 2B is compulsory for undergraduate economists at the University of Glasgow and attended by around 400 students each year. Paloni’s part of the course introduces students to heterodox economics with a focus on post-Keynesian economics. This is often the first, if not only, time that economics students engage with heterodox economics in their academic life. The course receives extraordinary student feedback.

The content of the course will, for now at least, remain unchanged. The teaching of it will be resumed by mainstream economists. Next year, more specifically, it will be taught by Prof Tatiana Kirsanova.

With mainstream economists for half a semester teaching perspectives that are highly critical of what they do, we sincerely fear that the content will be completely removed from the course sooner rather than later. Furthermore, until a potential removal, we fear that the heterodox content will be taught with the attitude that it is irrelevant and/or outright wrong.

The removal of Paloni’s teaching has been decided in the name of promoting research-led teaching. The department wants to (A) have Professors teaching Level 1 and 2 and (B) have the Macroeconomics Research Cluster involved in the course. Paloni belongs to the Finance Research Cluster.

We find these reasons dubious. Firstly, we do not think that it is the case that a professorship leads to a higher teaching quality. Secondly, we do not think that it is necessary to hold a professorship in order to teach the fairly basic content in Economics Level 1 and 2. Thirdly, we think that removing the only post-Keynesian economist in the department from teaching post-Keynesian economics is antithetical to the aim of promoting research-led teaching.

This is another story about thought control in economics I’ll tell in the future—and students and colleagues outside of economics again probably won’t believe me.

 

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More than 7 years into the current recovery and all the talk is about the number of jobs created, the falling unemployment rate, and the prospect that workers’ wages are set to finally increase on a sustained basis. Problem solved!

But what about the 1 in 6 American workers who were let go during the Great Recession, victims of the 40 million layoffs and other involuntary discharges during the official downturn that began in December 2007 and ended in June 2009? Not to mention the fact that nearly 14 million people are still searching for a job or stuck in part-time jobs because they can’t find full-time work.

As the Wall Street Journal reports,

Even for the millions of Americans back at work, the effects of losing a job will linger. . .They will earn less for years to come. They will be less likely to own a home. Many will struggle with psychological problems. Their children will perform worse in school and may earn less in their own jobs. . .

Only about one in four displaced workers gets back to pre-layoff earning levels after five years. . .A pay gap persists, even decades later, between workers who experienced a period of unemployment and similar workers who avoided a layoff. Estimates vary, but by one analysis, people who lost a job during recessions made 15% to 20% less than their nondisplaced peers after 10 to 20 years.

And that’s just the tip of the iceberg. Workers who lost their incomes or received lower incomes if and when they found a new job have found it difficult to save and make purchases (and, in many cases, had to dip into what savings they had), own a home, send their children to college, and pay for healthcare.

Losing a job, of course, has more than just financial consequences for workers and their families.

Unemployment often is an isolating experience. A layoff can strip people of their identity as workers in a chosen field and their workplace-based social network of co-workers and other contacts. Researchers have linked job loss to stress, depression and feelings of distrust, anxiety and shame.

Alarming trends that emerged after the end of the 1990s economic boom may have been amplified by the latest recession. The death rate for middle-aged whites has been rising as a result of suicides, substance abuse and liver diseases, all potentially products of economic distress, according to research by economists Anne Case and Angus Deaton.

Data spanning the recession years show a link between high unemployment and increased abuse of painkillers and hallucinogens. The U.S. suicide rate climbed 24% between 1999 and 2014, a rise that accelerated after 2006, according to the Centers for Disease Control and Prevention. One study of Pennsylvania men who lost long-held jobs during the early 1980s found a spike in mortality following a layoff, with middle-aged men set to lose a year to 18 months off their lifespans.

Researchers have found that the children of people who lose their jobs perform worse on school tests and are more likely to repeat a grade. A father’s layoff is linked with a substantially higher likelihood of anxiety and depression in his children. In one study, the sons of men who were displaced from their jobs earned salaries that were 9% lower compared with otherwise similar children whose fathers had stayed employed.

And the list goes on.

What no one in charge seems to want to talk about is the fact that the economic trauma of the Second Great Depression “has left financial and psychic scars on many Americans, and that those marks are likely to endure for decades”—thus scarring not just millions of individuals and their families, but all of American society.

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Special mention

www.usnews May 7, 2016

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Special mention

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