A Pall Over the Holidays - the Joblessness Crisis Intensifies
It was fascinating to observe the response, across the political spectrum, to the November unemployment statistics. Pundits on the right and left were quick to correctly point out that there was hardly anything positive or hopeful about the numbers. Republican Michele Bachmann, who opposes extending jobless benefits, hypocritically crowed that "the lower numbers are being propped up by huge numbers of Americans dropping out and giving up on trying to find a job. The labor participation rate dropped again to a tragically low percentage." She must be overjoyed. Earlier this year she expressed hoped that high jobless numbers would help her Presidential campaign.
Others have pointed to what is, under the circumstances, dismal news pointing to the urgency of the crisis, its human toll, and the imperative need for action to stimulate the economy to create jobs.
For U.S. working people, "these are the worst times since the depth of the Great Depression," wrote Mort Zuckerman, editor-in-chief of US News & World Report in
the Financial Times last week. "The unemployment rate, the highest and most sustained in seven decades, improved last month primarily because more than 300,000 people left the labor force. And the situation is even grimmer than suggested by the dismal statistics,
calculated from a base of only 60,000 families. Analysts have concluded that the combined unemployment and under-employment rate is slightly above a staggering 20 per cent of the labor force."
"Worse, 40 per cent of the jobless have been out of work for six months or more, compared with 10 per cent in 2007," wrote Zuckerman, also a real estate executive. "The average period of unemployment now exceeds 26 weeks, well above the previous peak in July
1983 of just 21.2 weeks. This is critical because the longer that people of any age are out of work, the less likely they are to find another job."
Economist Dean Baker of the Center for Economic and Policy Research noted that "Pretty much every sector of the economy saw a decline in jobs, but those declines seemingly were offset by a rise in the retail sector. We can speculate that the rise in retail was a result
of anticipating the holiday season and therefore temporary jobs."
Jobs in construction fell for the month in a row while manufacturing employment stayed about the same and public worker jobs decreased by 20.000, bringing to 278,000 the number of public sector jobs lost over the past year.
"Over the last three months, overall job growth has averaged 143,000. It takes roughly 90,000 jobs to keep even with the growth of the labor force," wrote Baker. "At this rate, it will take close to 200 months, or 16 years, to make up for the 10-million-job deficit in the
Zuckerman says, "For hiring to occur at a pace that would support recovery, we would need at least 500,000 more hires per month. Instead, payrolls today are more than 7 million shy of where they were when the Great Recession began."
According to the Department of Labor, employers added 120,000 jobs in November and the unemployment rate dipped from 9 percent in October to 8.6 percent. Experts say this was a result of more people getting jobs and others giving up on their job search altogether. And, it goes without saying, the situation is much worse for African Americans and in other
minority communities. The black jobless rate rose slightly from 15.1 percent to 15.5 percent compared with 8 percent for whites.
For Black workers the decline in labor force participation is a major factor in what is actually a worsening situation.
"The drop in participation was entirely among women and especially black women," economist Baker wrote December 2 (Among married women, employment rose by 194,000, so this was not a case of women as second earners dropping out of the labor force.) Participation numbers among white women fell by 199,000, a decline of 0.2 percentage points. The drop among black women was 164,000, a drop of 1.2 percentage points. These monthly numbers are highly erratic, and it is likely that at least part of this drop will be reversed in future months. Nonetheless there had been a trend of declining participation rates among both white and black women even prior to the November plunge. This suggests that there is a real issue of women losing access to jobs; although the December figures may show some reversal."
The decline in women's workforce participation rate is directly related to the political right's ongoing assault on public workers.
"Buried in the relatively positive numbers contained in the November jobs report was some very bad news for those who work in the public sector, the New York Times said editorially December 4. "There were 20,000 government workers laid off last month, by far the
largest drop for any sector of the economy, mostly from states, counties and cities.
"That continues a troubling trend that's been building for years, one that has had a particularly harsh effect on black workers. While the private sector has been
adding jobs since the end of 2009, more than half a million government positions have been lost since the recession.
"In most cases, states and cities had to lay off workers because of declining tax revenues, or reduced federal aid because of Washington's inexplicable decision to focus more on the deficit in the near term than on jobs."
"Those layoffs mean a lower quality of life when there are fewer teachers, pothole repair crews and nurses," the Times continued. And then, citing a report by its reporter Timothy Williams the previous week, the paper noted that the cutbacks "hit black workers particularly hard."
"Millions of African-Americans - one in five who are employed - have entered the middle class through government employment, and they tend to make 25 percent more than other black workers," the editorial continued. "Now tens of thousands are leaving both their jobs and the middle class. Chicago, for example, is laying off 212 employees in the upcoming fiscal year, two-thirds of whom are black."
"Many Republicans, however, don't regard government jobs as actual jobs, and are eager to see them disappear. Republican governors around the Midwest have aggressively tried to break the power of public unions while slashing their work forces, and Congressional
Republicans have proposed paying for a payroll tax cut by reducing federal employment rolls by 10 percent through attrition," said the editorial. "That's 200,000 jobs, many of which would be filled by blacks and Hispanics and others who tend to vote Democratic, and
thus are considered politically superfluous.
"The layoffs are not expected to end any time soon," Williams wrote. "The United States Postal Service, where about 25 percent of employees are black, is considering eliminating 220,000 positions in order to stay solvent, and areas with large black populations - from urban Detroit to rural Jefferson County, Miss. - are struggling with budget problems that could also lead to mass layoffs.
"The postal cuts alone - which would amount to more than one-third of the work force - would be a blow both economically and psychologically, employees say."
"But every layoff, whether public or private, is a life, and a livelihood, and a family. And too many of them are getting battered by the economic storm," said the Times.
There was also scant good news for the group that is consistently hit the hardest historically by joblessness and particularly amid the current economic crisis. The seasonally adjusted unemployment rate for African Americans between 16 and 19 years old was 39.6
percent in November. That's down from 46.3 percent a year ago but up from 37.8 in October. The black youth workforce participation rate - 37.4 percent – has remained practically the same over the past 12 months.
The average jobless level for young African Americans for the third quarter of this year is 43.4 percent, up from 40.7 for the same period last year and 30.9 percent in 2008.
For white teenagers the jobless rate is 21.4 percent, up from 20.8 percent in November 2010 and down from 21.8 percent this October.
As could be expected, the policy responses of the two sides of the aisle have been quite different. With most - but not all - of the Democrats seeking to extend existing jobless benefits and the Republican mostly united around a proposal to reduce them. GOP
Congressional leaders are actually proposing to decrease the number of weeks jobless benefits would be available, execute new spending cuts and curb the pay of federal employees. They have actually introduced a measure to that effect into the House of
Representatives that could be voted on this week.
Meanwhile, according to the Times, "If Congress does nothing, benefits for the long-term unemployed will begin to expire early next year, and two million people could lose benefits by mid-February."
It is estimated that if Congress does not act before New Years to extend benefits nearly 6 million people will lose federally funded unemployment compensation over the course of next year.
According to the Center for American Progress, 1.2 million African Americans and 1 million Hispanics would benefit from an extension of unemployment benefits.
The proportion of unemployed African Americans over the age of 16 who have been out of work for 27 weeks or longer as of October 2011 is 48 percent. For Hispanics it's 39 percent.
Then there are the 99ers, those workers who have already exhausted their unemployment benefits and about whom there is ever hardly a mention in the major media (about half the jobless are currently receiving no assistance at all). There is a measure before Congress
- HR 589 - which would give them some assistance. During a recent House of Representatives debate on jobless benefit extension, the only member to bring the matter up was Rep. Barbara Lee (D - Ca) who has, as noted by Crewof42.com, brought the issue up "repeatedly in conversations with the White House, on the House floor, at press conferences and in meetings."
In California alone an estimated 305,000 workers will be left without income if the benefits are not extended. The state's unemployment rate for young people 20 to 24 years old is 19 percent. For African Americans as a whole the rate is nearly 20 percent and close to 15 percent for Latinos.
"With California unemployment hovering around 12 percent, job seekers far outnumber actual jobs," said California Labor Federation Executive Secretary-Treasurer Art Pulaski. "It's deplorable that Republicans in Congress and their special interest friends are attempting to sever the one remaining lifeline for California's jobless. California's Republican members of Congress need to get their priorities in order. Our state's jobless need an extension of benefits far more than the richest 1 percent needs yet another fat tax break."
"The outlook is bleak," wrote Zuckerman. "Over 20 per cent of companies say that employment in their firms will never return to pre-recession levels. Another 40-plus per cent say revenues would have to rise around 40 per cent to return to pre-recession employment levels. Moreover, most of the new jobs available don't match the pay, the hours or the benefits of the positions that vanished during the recession. Millions of Americans face a lost decade, living from paycheck to paycheck, struggling to pay their bills, having to borrow money and go deeper into debt."
"The prospect of losing benefits during the holiday season takes a tremendous toll on those suffering the hardship of unemployment," said Pulaski.