The Pessimism of the Unemployed

The V-shaped recovery just keeps getting better. With all the orders they are garnering and profits they are making, U.S. businesses are beginning to hire like gangbusters. Confidence and credit market conditions are also looking up. Pretty soon, I may have to change the name of this blog to Economic Euphoria.

Er, sorry, only joking. Conditions are not really improving, and the job market is showing few signs of a turnaround. In fact, as the the following post, "Checking In on Last Year’s Unemployed," from the New York Times' Economix blog, reveals, the reality on the ground is anything but positive:

The John J. Heldrich Center for Workforce Development at Rutgers has released its latest work trends report on the long-term unemployed, and the results are somewhat discouraging. (The title of the report — “No End in Sight: The Agony of Prolonged Unemployment” — was sort of a giveaway, though.)

The report concentrated on people who were unemployed as of August 2009, and checked up on their status as of March 2010. What happened to these folks?

Despite persistent growth in economic output since August, two-thirds of those workers — 67 percent — were still looking for work in March. Another 12 percent had given up and dropped out of the labor force entirely.

Just one in five — 21 percent — had found work, with about half of the newly employed able to find only part-time work.

Younger workers — who generally have a much higher jobless rate — were more likely than their older counterparts to have found work by March. This makes sense, given other statistics showing that there are lots of young workers who are unemployed, but that they don’t spend much time looking for jobs.

Source: “No End in Sight: The Agony of Prolonged Unemployment,” John J. Heldrich Center for Workforce Development.

Most of the people who found new jobs waited months to do so. The chart below breaks up the newly re-employed into groups by how long it took them to find work:

Source: “No End in Sight: The Agony of Prolonged Unemployment,” John J. Heldrich Center for Workforce Development.

Additionally, just over half of the workers who found new employment say they accepted a pay cut from what they earned in their previous job.

“Perhaps one of the more challenging threats to the economic recovery is the pessimism that permeates among the unemployed,” the authors write.

You can find more charts and statistics about the long-term unemployed, and their financial and emotional states, here.

Comments

[Youngworker]

Sadly this true. All a sudden I see no more openings. Its been about 1 year now. Really starts to affect your mental outlook.

[Marion Shaw]

We need another Woody Guthrie and Franklin D.Roosevelt,
fast. Otherwise we are going to start seeing the rise
of Huey Longs and need I say the H word? Instead we
are getting a steady diet of drug addicted talking
heads, like Rush Limbaugh and recovering alcoholic,
Glen Beck, who proves my father's frequent observation
years ago as a college math professor, a little
learning is a dangerous thing.

[Mitch]

Neo-feudalistic is the word.

We look at the scandals of repaying American taxpayers with their own cash. We also check out the headlines on Lloyd ‘I’m Too Mysterious’ Blankfein, Bernie ‘I’m Just a Market Maker’ Madoff and Warren ‘I Love My Goldman Investment’ Buffett. In the second half of the show, Max interviews investment adviser, Michael Krieger, about “America’s Disneyland and Neo-feudalistic, Gulag Casino Economy,” financial war between the US and China; and about which nation will be the first to back its currency with gold.

http://tinyurl.com/28dwwwp

[ykw]

Whether it is a white swan or a black swan depends on perspective.

Domestic Green Shoots & V-Shaped Recovery vs.
European Tarp: $7.5 Trillion Needed Immediately:
The Misdirection Drum Beats On

So, they borrowed $1.75B in April, the best tax intake month of the year. Does anyone really think that they are going to borrow less than $2 Trillion in the upcoming year? It’s more likely to top $3T, and for what, a few points of GDP to calm the natives, at the expense of driving the rest of the globe into depression, by consuming all global capital on the margin. If oil was $30/barrel and wages for unprotected labor exceeded basic expenses, would Greece be in its current situation?

The only thing that changes about empire behavior is the sophistication of misdirection, the ability to induce self-liquidation of economies to the closely held empire, through false price signals. The US Government is not serving its people, so who is it serving?

There is a $50/barrel irrational premium for oil, outsourcing is still running at full tilt, and the Fed is virtually printing money for the global banks, which cannot lend, because their asset base is an illusion, creating pressure on the vice around discretionary income globally.

Talent, the inductive motor, is randomly distributed by nature; it is the unknowable in which you must have confidence to operate an economy. Once you know where the electron is, which the empire is constantly trying to ascertain, to exploit (creating the voltage potential), the motor comes to a stop, which is why talent hides itself within the labor pool.

When you have talent, excess wealth / individual surplus, and you observe all proceeds from labor diverted to the politically correct, would you invest your surplus in that economy?

No, which is why all the premium talent is investing itself in the next economy, and why the existing economy is liquidating. The Fed, an arm Congress, despite the latter’s protestations, which does not represent the people, is squeezing the global economy dry, to prime a dead pump, which is designed to create artificial domestic demand for artificial global supply, all of the proceeds of which accrue to the system proprietors, after the cost of its minions, through Wall Street.

Real wealth creation is a function of participation, which requires induction, how many people are making pie versus how many people are eating pie. Return to unprotected labor after WWII was 65%. Today, it is 15%. No one is making pie in the old economy, while the line to consume it grows longer and longer. So long as there is no return to unprotected labor, there will be no pie, and the increased taxation will require an acceleration of debt, illiquidity and insolvency.

Hello. Betting is simple. Bet against the weakest links, right up the chain, which is exactly what the remaining traders are doing, but where is the exit?

They are employing relativity, timing, to maintain profitability, and delay until an exit presents itself. The exit is whatever mythology all the parties can buy into to deliver 51% return to unprotected labor, to re-ignite the economy.

What happened in Greece? The new administration opened the books … and Greece got clobbered. The real US debt to GDP is larger; on average, each American already owes $1.5 million.

The experts led their followers into a corner, and increasingly find themselves surrounded by an angry mob. If you are waiting for them to solve this problem, you are waiting for what is not going to happen. There is nothing worse than human critters, with no adaptive skills, backed into a corner.

Focus your energy on building what is next, and minimize energy required to maintain your position in the current system, to jump the gap. Right now, you need global constitutions, mythology, to let those critters out of that corner. The connection between systems will look something like purely municipal law. State rights versus federal preemption is playing out now.

The new motor is already built and installed. How you hook up to the kids will determine overall voltage pressure and how the current may be distributed. It’s a function of goodwill. You will not know which kid is which, and they are globally distributed. Your transformer will depend on local surplus to be traded globally in excess of a self-sustaining local economy.

The latest message from Control: “a sense of resignation.” Where is Maxwell Smart?

[friend of a friend]

Mitch, I enjoyed your post until the last two paragraphs. It gets a litle fuzzy there. Thanks for the insight.

[friend of a friend]

Oops...I meant ykw..Sorry

[Rocky]

The high cost of insuring older workers is certainly making it harder for unemployed 60 year olds to find work.

[roger]

in the good old days the Elite was content to keep
unemployment at 5% ,it was considered enough to keep
those greedy workers in check,with the rise of the
middle class this is no longer satisfactory,profits
are plummeting,the middle class must be relegated back
to the lumpenproletariat