In Bad Shape

Although I've said it before, I still can't believe that anybody is talking about economic "recovery" with a jobs market as bad as the one we have now. Aside from all the other data we've seen lately, here are three reports that emphasize just how challenging things are for those who are trying to earn a living the old-fashioned way:

"Help Wanted: Only Interns" (CFOZone.com)

Here is a frightening development from a macro economic standpoint. However, for CFOs, it frankly offers a shrewd opportunity to boost staff without destroying the budget.

A CareerBuilder survey of more than 2,500 employers found that more than one-quarter (27 percent) plan to hire interns during the remainder of 2010 to help support workloads.

Good for potential interns.

Here's the scary part. Look who is applying for these internships.

According to CareerBuilder, nearly one-quarter (23 percent) of employers report they are seeing experienced workers, those with more than 10 years experience. Even more astounding, employers are reporting that workers age 50 or older are applying for internships at their organizations.

This underscores how critical the employment problem has become in this country.

Obviously, companies like interns because they are cheap and don't receive benefits.

Indeed, seven percent said they don't even plan to pay their interns. Another 5 percent said they will hire both paid and unpaid interns.

Just a little more than half (53 percent) said they plan to pay interns $10 or more per hour, which is what retailers pay their unskilled labor.

A benevolent 5 percent said they will pay $25 or more per hour.

"Employers Moving Slowly to Fill Jobs" (Wall Street Journal)

Employers filled available jobs at a slower pace in June, in a development that could further complicate the U.S.'s battle with long-term unemployment.

The Labor Department reported Wednesday that nonfarm employers made 4.3 million new hires in June, down 7% from May. That left them with 2.9 million job openings at the end of the month, unchanged from May.

The June data highlight a growing disconnect in the labor market. Even as jobs remain scarce, employers are being unusually slow to fill positions—a problematic trend at a time when 4.3% of the labor force has been out of work for more than six months. As of June, job openings were up 26% from mid-2009, when the economy bottomed out. New hires rose only 5% over the same period.

"It's troubling," said Henry Mo, an economist at Credit Suisse in New York. "We need employers to hire more boldly to make the recovery self-sustaining, but we're not getting there."

"Forced to Retire, Some Take Social Security Early" (Associated Press)

Unable to find work, unemployed turn to reduced Social Security checks early to stay afloat

Paul Skidmore's office is shuttered, his job gone, his 18-month job search fruitless and his unemployment benefits exhausted. So at 63, he plans to file this week for Social Security benefits, three years earlier than planned.

"All I want to do is work," said Skidmore, of Finksburg, Md., who was an insurance claims adjuster for 37 years before his company downsized and closed his office last year. "And nobody will hire me."

It is one of the most striking fallouts from the bad economy: Social Security is facing a rare shortfall this year as a wave of people like Skidmore opt to collect payments before their full retirement age. Adding to the strain on the trust are reduced tax collections sapped by the country's historic unemployment -- still at 9.5 percent.

More people filed for Social Security in 2009 -- 2.74 million -- than any year in history, and there was a marked increase in the number receiving reduced benefits because they filed ahead of their full retirement age. The increase came as the full Social Security retirement age rose last year from 65 to 66.

Nearly 72 percent of men who filed opted for early benefits in 2009, up from 58 percent the previous year. More women also filed -- 74.7 percent in 2009 compared with 64.2 percent the previous year.

Jason Fichtner, an associate commissioner at the Social Security Administration, said the weak economy has led more people who lost their jobs to retire early. However, it also has forced some people hard-hit by the recession and in need of a bigger paycheck to push back retirement and stay in the work force longer.

"But we're seeing more people taking early benefits than staying in the workforce longer," Fichtner said.

Comments

[Mark]

I just don't see what the motivation is for companies to hire new workers when they can hire interns and temp workers. Until global demand forces them too, there is no motivation to hire new employees while they can get increased productivity from the same ones.

[Margret]

I now am really starting to think whether an economic recovery is coming.

Have a look at this guys video. He is from OZ & called the market crash back in 2008, and has been spot on since day one. Everyone was laughing at him, but guess who is having the last laugh now...hmmm his video at :-

http://www.youtube.com/watch?v=gn6kS4l2yFM

[Youngworker]

I need a job!

[Marion Shaw]

Maybe it is time to start looking at post World War II
nations that made it back from destruction such as
Japan, Germany, South Korea, England, France, etc.
Of course the Korean War provided a capital base for
Japanese growth. The Vietnam War provided a capital base for S.Korean growth. I don't know what provided the capital formation for the post war recovery of Germany,France and England. Maybe there are some prudent solutions there for our own American prospects.
Ironically America was once the have nation of nations
that was surrounded by a sea of have-not nations.
Now America is a nation of haves surrounded increasingly by a neighborhood of have-nots. Unless
real job opportunities are forthcoming, the only
direction will be back to the land for survival,
which is now largely owned by the government or large
corporations. A jobless proletariat, starving in dark,
cold, empty urban apartments has not led to happy
results in the past century.
I just hope that those increasingly without jobs,
have relatives they can fall back on somewhere in the
nation.

[Rocky]

Marion: Germany, France and England were helped to get back on their feet by the Marshall Plan, one of the best foreign policy decisions ever. But I have read that it was not supported by most Americans in the late 1940's. US taxpayers footed the bill for this foreign aid and even paid high consumer taxes and high income taxes to help pay down the US national debt. These days we think only the rich ought to pay taxes and that a national sales tax would "hurt the poor". Wait until the price of a pair of Chinese shoes goes up from $50 to $150 because the $US has lost so much of its value. The poor will all be wearing cheap running shoes.

[sharonsj]

A lot of people have no choice but to take early SS to survive. I had medical problems and used up all my savings. But wait, maybe I can take that airline job in Dubai? Do you think they'd widen the center aisle to make room for my walker?

[Rocky]

In less than 2 years the first Boomers qualify for Medicare. Many are already running up huge medical bills as unwise life style choices in their younger days are now resulting in various forms of cancer, heart disease etc. Today's young Americans face a grim economic future as their pay checks are decimated to pay for the Boomers' Social Security and Medicare benefits. Then there is the cost of the bloated military. It is very expensive to be the policeman of the world. Maybe young people with good skills ought to be looking abroad for opportunities.

[Marion Shaw]

Rocky: thanks, I later remembered The Marshall Plan
after I made the post. But it was a stimulus sort of
deal, was it not? Huge sums of capital were pumped
into the said economies which America herself acquired
from the resurrection of production through war indus=
tries. I wonder what the ratio of the stimulus created
to save the large banks, etc. of several years ago
would be in proportion to the Marshall Plan?
Clearly, the American economy has not really benefited
from those billions of dollars (might we call it the
Paulson Plan?); it is not clear where they went and
recent reports say foreign countries actually benefited.Whereas the Marshall Plan really created new
production and jobs and commerce, the "Paulson Plan"
seems to have had just the opposite effect in mainstream America.
So. I guess my question is ultimately, who is looking
out for the American people? I don't think Americans
object to paying their fair share of taxes (and do
by the way,extensively). What they object to is seeing
unimaginable sums of money floating around, apparently
benefiting somebody, somewhere, but not we ourselves.
The poor have been wearing cheap Chinese running
shoes for years; the real poor.

[roger]

to earn a living the old-fashioned way,was never easy,
witness the potato eaters by Vincent Van goth.
When did employers hire for the sake the economy?
it maybe hard for some people to believe but class
warfare has been going on for a long long time,
if necessary we topple foreign governments who
espouse any form of socialized philosophy starting
with the American Siberian adventure back in 1918/ 1920.
The only way to keep profits going is by making labor as
cheap as possible,and the only way to do that,is by creating
mass unemployment, big biz is good at doing that.

[kevinearick]

Ground to Control: Mythology Recap

This cycle has been repeated for a few thousand years now. The proprietors know that they have to restore new family formation, increase return to unprotected labor back to 50+%, and restore community circulation in order to re-ignite the economy. Generally, we agree to a quantum improvement, but retain the mythology of top-down execution, for the majority, which prefer to herd, within a framework, a sub-frame of reference, of safeties, constituted to protect the majority from its own natural inclination to stampede off a cliff.

Protection from evolution produces insecurity, which leads invariably to hoarding, the example is copied from the top down, until excessive control cuts off circulation and triggers cancerous replication, leading the herd to run off the cliff, in what it believes is a rational response. Hoarding shuts down the economy, and the hoarding accelerates as each individual tries to “survive” intact. Greed works.

This time around, we have hit the wall of global demographic deceleration, with pro-cyclical leverage acceleration, which means we need to shift to catch the leverage, and slope the derivative of mythology in rapid succession, beyond the knowledge of the wall, into equilibrium. Practically, that means communities need to create an environment that encourages young people to form new families and build small family businesses, to reignite the pilot, and then rapidly re-install the gears to reconnect the empire. / HVAC. That is, we can no longer afford the luxury of ignorance, proffered by the herd, which assumes TBTF empire control.

And the young people would just as soon see the planet remove the current cancer from its face, and start over. It’s the Einstein assumption problem. A PhD in economics is required to both completely remove all logic from the surface of the mind, and, simultaneously, assume that actions occur in the vacuum of equations contrived to confirm the logic of central control.

The “union” is created naturally, in an algebraic process of elimination, a distillation / titration. It is the human product of evolution. This “crisis” will continue until ignition prerequisites are met. It’s not a matter of negotiation. It’s a matter of navigation, into the unknown, where GPS and electronic parallel parking are counter-productive.

[His name was RICO]

No recovery til the frauds are stopped...

Max talks to former banking regulator William K. Black about rackets and fraud in the financial sector.

http://maxkeiser.com/2010/08/12/kr68-keiser-report-markets-finance-tier-terra/