Posts Tagged ‘jobs’

d22e822076dc7f4fae585b6c27ec09db

Special mention

7-9 mike3april

RAMclr-040716-forgo-IBD-COLOR-FINAL

Special mention

177819_600  April 7, 2016

177626_600

Special mention

20160408edohc-a_s878x609 177763_600

Sanborn-CSU

James Sanborn, “Adam Smith’s Spinning Top”

As is well known, mainstream economists are generally opposed to significant increases in the minimum wage and in favor of free international trade. That’s what you’ll find in all the major economics textbooks, the articles and books written by mainstream economics, and in the policy advice they give.

You’ll find a good sampling of their views in the IGM Economic Experts Panel—in questions about trade (from 2012) and the minimum wage (from 2015).

trade

minwage

But there’s a fundamental inconsistency in the case against raising the minimum wage and for free trade. Mainstream economists argue against a minimum-wage increase because it will, so they say, increase unemployment (at least at the bottom of the labor market) . But when it comes to international trade, which has generally hurt employment (at least among certain groups of workers), the argument turns to other things, like efficiency and lower prices for consumer goods.

Their conclusion is that, while the aim of the minimum wage is to help low-wage workers, it actually hurts them. But when it comes to free trade, some workers may be hurt but they (and everyone else) will eventually benefit from lower prices. And, if they don’t all benefit from free international trade, at least it’s possible for the gainers to pay off the losers—but no such argument is made about the minimum wage.

What’s going on? Well, technically, mainstream economists are looking at partial equilibrium (when it comes to the minimum wage) and general equilibrium (concerning free trade) effects. They’re examining a single market in isolation (the labor market) and all markets together (in the case of international trade).

Even more important, they’re demonstrating their theoretical commitment to free markets—the idea that people are hurt by interventions into free markets (like increasing the minimum wage) and benefit from more free markets (especially at the international level). That argument is so ingrained in mainstream markets that it’s impervious to criticism, at least from within mainstream economics.

The idea that the economy might be organized not on the basis of free markets, but on some other foundation—call it community, sharing, subsidiarity, sustainability, or something else—literally makes no sense within mainstream economics.

That’s why mainstream economists continue to spin their free-market top, even though it stops and topples over on a regular basis.

81_176523-1

Yes, American workers are angry. But not just for one reason—for many reasons.

It took a long time for U.S. political and economic elites (and their friends in economics) to understand that the American working-class has been squeezed far beyond what it can take. Even now, it’s not clear they understand, although the campaigns of Donald Trump and Bernie Sanders have given clear indications that the establishment is out of touch.

Even then, the anxieties and frustrations of U.S. workers can’t be put down to one thing.

MM and SK on Voter Anger - Manufacturing Employment Decline.xlsx

Sure, as Mark Muro and Siddharth Kulkarni explain, the American working-class is angry about the loss of manufacturing jobs.

fredgraph

But let’s also remember that the share of manufacturing jobs in the United States has been on a steady decline since its peak of 39 percent in 1943.

Still, the drop in the number of U.S. manufacturing jobs accelerated in the new millennium, coinciding with a rise in the offshoring of jobs to and the rise of imports from Mexico, China, and other countries in the process of capitalist development. That’s certainly one key factor.*

wages

But American workers are angry for other reasons—such as the fact that, as Jared Bernstein explains, their wages, which had doubled from the 1940s to the 1970s, have flat-lined since.

11497

Even more: only wages at the top—above the 90th and 95th percentiles (which, as I have explained before, aren’t really like other wages but, instead, represent cuts of the surplus)—have seen any appreciable increase since the start of the Second Great Depression.

fredgraph-1

Meanwhile, even with slow growth, corporate profits (both financial and nonfinancial) continue to rise to record levels.

Thus, workers are falling further and further behind, while the tiny group at the top continues to pull away from everyone else.

Figure-1-e1455723650211 Figure-2-e1455723827815

What this means is that every indicator we have—such as average incomes and the share of income captured by the top 1 percent—shows grotesque and growing levels of inequality within the United States.

So, yes, American workers are angry—at the loss of jobs, their stagnant wages, their employers’ record profits, and the obscene and still-increasing levels of inequality they witness every day.

 

*Daron Acemoglu et al. (pdf) estimate that, considering both the direct and indirect effects, import growth from China between 1999 and 2011 led to an employment reduction of 2.4 million workers—and thus about 40 percent of the decline in manufacturing employment during that period.

A new report from the UCLA Labor Center [ht: ja], “I am a #YOUNGWORKER,” challenges the prevailing cliché of “young people as self-indulgent millennials who live with their parents, idly wait for the perfect job, and collect paychecks mostly for shopping and weekend leisure.”

In reality, many employers rely on youth to supply “cheap, surplus, temporary and easy-to-discipline labor” that can be recruited or disposed of according to the whims of the business cycle. Adults often portray these early jobs as brief interludes or rites of passage to justify the precarious conditions of “youth” forms of work.

The study focuses on workers between the ages of 18 and 29 in retail and food service, the two largest employers of young people in Los Angeles. Together, they employ a quarter-million young workers—almost half (42.6%) their workforce.

work status

The authors of the report discovered that young workers are often employed in part-time jobs, they play an integral role in supporting their families, and one in ten live below the poverty line.

In addition, young workers struggle to balance work and school (“They need to work in order to afford school, and they need to attend school so they can get ahead at work”) and owe increasing amounts of educational debt (more than $19 thousand on average).

On the job, most (90 percent) do not have a set schedule, since they are forced to “depend on schedule assignments that are staggered weekly and build an intricate web of overlapping shifts that ensure that workers are constantly present on the store floor or stockrooms.” They are also vulnerable to various forms of wage threat (not getting paid for overtime or working off the clock), are often harassed by both bosses and customers, and do not receive the benefits (such as sick days, vacation, and health insurance) other workers have managed to secure.

Screen-Shot-2016-01-13-at-3.28.10-PM

As if that were not bad enough, the youth unemployment rate (11.2 percent) is more than twice the official rate (5 percent).

In other words, young workers today are often living on a “dead end street.”

175453_600

Special mention

scalia-gay-citizens-united PettJ20160213_low