Just in case you were having too much fun on this beautiful Saturday, this is a reminder that the unemployed and young folks interning and working part-time are still screwed for the long haul. Underemployment hits 20% in Mid-March (emphasis mine).
Even with historic healthcare legislation under consideration, Congress passed and the president signed a new jobs creation bill on March 18. No doubt, national attention will shortly shift to unemployment and anticipation of the government's April 2 report of the March unemployment rate. In this regard, Gallup's mid-March unemployment rate is likely indicative of the not-seasonally adjusted unemployment rate the government will release in April, as is Gallup's broader underemployment rate.
The danger associated with focusing on unemployment is reflected by the recent statement of Morgan Stanley economists suggesting that the U.S. may add as many as 300,000 jobs in March owing to an improvement in the weather, economic growth, and the government's hiring of temporary census workers. If anything close to this number of new jobs is announced by the government in early April, there is likely to be an enthusiastic, possibly even celebratory, response. Government officials are liable to tout the continued benefits of last year's stimulus and the future benefits of the new jobs bill. Many Wall Streeters will likely argue that the surge in jobs is simply another confirmation of the strength of the overall economic recovery.
However, before policymakers celebrate too much, they should note Gallup's recent findings involving its new, more inclusive measure of underemployment. To be sure, there are some benefits associated with the unemployed getting part-time jobs, no matter the source. For example, Gallup's self-reported spending data show that part-time workers who want full-time work spent on average 24% more per day ($51) during the past 30 days than did the unemployed ($41). While this represents an improvement and is good for the economy, it is not nearly as good as the 85% higher daily spending of those having full-time jobs ($76).
It is also often suggested that a growth in part-time jobs may indicate future growth in full-time work -- that companies hire part-time workers before committing to hiring new full-time employees. While this is sometimes the case, it may not be so at this point in the U.S. economy: Gallup data show that one in three part-time employees who are wanting full-time work are currently "hopeful" about finding a full-time job in the next 30 days -- not much of an endorsement of the idea that today's new part-time work will progress to full-time jobs.
Regardless of how one interprets the shifts taking place between part-time and full-time jobs, it is important that policymakers focus on the broader goal of reducing underemployment, not just unemployment. Part-time, temporary jobs like those associated with census-taking are far better than no job and may reduce the unemployment rate, but they do not represent the kind of job creation needed for a sustainable economic recovery.
On an added note, Corrente, a great website that has advocated for single-payer health care, plans to have a discussion of the book ECONned tomorrow with the author Yves Smith. I received the book last week from the publisher and I haven't gotten around to finishing it yet but hopefully I'll have a short review up along with a giveaway of the book next weekend (I'm starting to sound like a law school professor o_0). If you can't wait you can buy the book on Amazon.com.
Now get out and enjoy the sunshine.
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i must admit, I used to not visit this blog that much, but you guys in tandem post more often than the other lawblogs, so you've won me over.
ReplyDeleteA few thoughts on this:
- I would really like to know the definition of part-time. Is it 10 hours? 20 hours? 30 hours? I mean, those three possibilities are very different. There should be some explanation as to what "part-time" means. I've always thought that the proper way to keep track of employment was to keep track of hours instead of people working. i would count 35 hours a week as "full-time" and one job. If there were two people clocking in 17 hours a week each, I would say there's one person employed and one unemployed. I think that's a more accurate picture, though it's probably harder to collect such data.
- I would also like a better definition of what "underemployed" means. I think a portion of that is the part-time workers. But they also often add people who say the job they currently have is is one they are "overqualified" for. Well, that's highly subjective, no? And these polls rely on subjective responses. Not that I think people lie, but sometimes their perception is skewed. They may have expected a position more ideal than they wound up with. But their expectation may have been higher than warranted.
- My Saturday is turning out pretty decent thus far. Hope yours is both swell and magical.
Hardknocks I had no idea you were enough of a player to get free books. I planned to buy Econned, but I'm broke and $20 is a case of bud light and a bottle of Yellow Tail, so I needed to put off the purchase for a few weeks.
ReplyDeleteIf you can pull a few strings with the publisher - tell them I'm a huge Yves fan - I'd be in your debt forever. Of course, since I'm not paying my debts, that is of questionable value.
Let me know when you're hosting the book club and I'll chime in.
A quick heads up to Frank the Unemployed if you are reading this:
ReplyDeleteThere appears to be a bug in your commenting system. It cuts off the word verification so there's no way for people to post a comment. Thought you should know.
A quick heads up to Frank the Unemployed if you are reading this:
ReplyDeleteThere appears to be a bug in your commenting system. The word verification is cut off so that nobody can comment. Thought you should know.
angryfutureexpat, you may enter our contest. If you don't win, I'll see if I can get you a book or I could mail you mine.
ReplyDelete