Do the financial numbers reflect the state of the economy or does this narrow measurement more accurately reflect the health of the wealthy?
I'd posit that the employment picture reflects the nation's ability to pay. Industries with robust bottom lines can turn sour very quickly when people stop buying their products...because they can no longer afford them.
The first thing to look at is This current data on people `not in the workforce'.
Not only is there a staggering 77,948,000 people `estimated' to be not in the workforce but 73,291,000 are lumped into the category of not even wanting a job!
Only seven million people filed tax returns in excess of a million dollars in 2004...
Is the underground economy absolutely HUGE? Is organized crime much larger than we've been led to believe?
The split is pretty even between those over 55 and younger crowd with 32,716,000 estimated to be under 55...and not wanting work.
Perhaps the real problem here is we're dealing with estimates and the real reason for not working/looking for work isn't given.
The next telling piece of the puzzle is to take a look at the newspaper for local job listings. This is a bit tough to do in my neck of the woods because all of the small daily papers have been gobbled up by some outfit from Alabama.
So I get job listings for cities fifty miles away...not that this helps. Help wanted ads run for two weeks and they still don't fill a half a page...these are papers with total readership in the quarter of a million range.
Not that everyone gets the paper--some folks can't afford it.
I'd estimate (what the heck, the government does it all the time) that there are around a hundred job postings advertising maybe a hundred and fifty [potential] job openings.
Some of the fuckers are merely fishing, looking for cheaper help.
The next thing to look at is income distribution These figures are from 2004. It is not know how often they are updated.
It's important to keep in mind that the income distribution figures include all working aged adults starting at age 15 of both sexes.
The largest single segment of men (14,878,000) earns less than $2,500 a year. To this figure we add 25,367,000 females for a total of 40,245,000.
All men earning over $75,000 a year total 14,242,000. This is 12.81% of the 111,000,000 male total. For parity we add the 4,485,000 women that earn over $75,000 for a total of 18,727,000.
By comparison, females earning over $75,000 represent just 3.778% of the total 118,739,000 females.
If we take a snapshot of all workers earning over $75,000 this percentage drops to 7.95% of our total 229,739,000 person [potential] workforce.
Income distribution isn't the only disturbing thing about our economy, what we do in order make our daily bread gives us a better picture of our collective economic health.
We now jump to the bureau of labor statistics for a look at the economic breakdown of who does what for an average of how much...
These are the 1999 figures for employment wages by major economic group.
These figures provide a `snapshot' of the economy by condensing like occupations into major groups.
Let's look at this like we were CEO's trying to figure out if we have a workable mix of activity going on.
The first table tells us how many folks are working during the period measured. I'll include links to the years 2000, 2001, 2003 and 2004...dunno why 2002 got skipped but it's the number of people counted as working that takes you by surprise.
In 1999 we have a measurement of 127,274,000.
In 2000 this number increases to 129,739,000.
In 2001 we go back down to 127,980,000.
They skip 2002.
In 2003 we drop even more to 127,567,910...yeah, they even included the exact figure rather than rounding it off, go figure?
The last year figures are given is 2004 where we pick up a few hundred thousand to see 128,127,360.
By digging a little harder This recent report (Mar 2006) on the employment situation.
Hold on to your hat because this report claims the workforce has grown to a whopping 150,652,000 with 143,641,000 actually employed!
This is a net gain of 15,513,640 jobs in less than two years! (For parity reasons I'm ASSUMING the figures in the earlier economic reports provide total employed figures rather than total workforce figures, thus the smaller gain.)
If you've been paying attention to the monthly job creation reports you'd know something is very much askew here.
According to this radical change the economy would have added 646,401 jobs a month, every month, for the past 24 months...
If this were true then why were they crowing about the 211,000 jobs added in March, a figure all can see right on their homepage?
Perhaps one of our resident economic experts would like to take a crack at decoding this one, failing that, we can simply assume the folks at the BLS are smoking crack!
I picked up on these economic reports for a reason. They show the percentages for each major segment of the economy.
Back to the data.
In 1999 the top five groups were in this order:
Number one was office administration and support employing 17.7% of the workforce (at some pretty pathetic pay I might add.)
In second place is Sales and Related employing 10.2%. You'd think these folks would be doing better but wages are still pitiful thanks to the large number of folks employed in retail.
In third we find Production employing 9.9% of the workforce and lumps together strange fields like bakers and candy makers...
This of interest because it is where our goods for personal consumption as well as export are made and we all know the trade deficit continues to set records on a monthly basis...
In fourth we have food preparation employing 7.6% of the workforce and a 2.3% drop in percentage.
Hot on Food prep's heels we finish with transportation and material moving accounting for 7.5% of the workforce.
Figures for 2000 can be found here.
Figures for 2001 are here.
Figures for 2002 must be embarrassing so we skip to 2003 here.
And our final report for 2004 can be found here.
I'll cut to the chase and list the top five in 2004, note the changes.
Office and administrative support is still number one at 17.7%, unchanged from 1999.
Sales and related remains at number two with 10.5% posting a .3% increase.
We have a new number three. Food prep and service now stands at 8.2%, an increase of .6%
Now in number four spot we have production at 7.9% a full 2% reduction...in the sector that supports every other sector of our society.
In the number five spot we still have transportation at 7.5%, unchanged since 1999.
The 2003 and 2004 reports show the economy in crescendo from largest to smallest.
It's a bit ironic to note that payroll for these economic sectors does pretty much the same thing, the more people employed in a field the less it pays.
One notable exception to this is management; the other is poor, pitiful farming, fishing and forestry...dead last by employing just .4% of the workforce and a with a median wage of just $9.76 an hour.
It's interesting to note that management compensation overtook legal in 2003! Maybe this is why there's no 2002!
In the 2001 chart `legal' was still in the lead ($ wise) although it is listed under management for some strange reason but the older charts seem to be less organized...no offense Fatemeh.
Are we ready to do some economic analysis?
Returning to the 2004 tables we see what can only be described as an inward focus, a concentration of resources located in the service end of the economy.
As CEO's we should be looking at how we are going to address our trade imbalance, looking at what sectors of our economy produce exportable goods.
Raw materials, foodstuffs and finished goods are the three primary areas to consider although much attention is given these days to intellectual properties with a certain degree of military hardware added in.
Yes, the prophets of globalization told us our main exports would have to come from our brain trust.
This ignores the fact that intellectual property is more often stolen (`pirated') than purchased.
This leave military hardware, stuff we should probably think twice about exporting more so because of what gets done with it than the fact it's being made elsewhere these days.
I tried to find historic data on our manufacturing sector but like many of the census tables they seem to have been `massaged', the figures rise gently through the years with no apparent peaks or valleys.
They are too smooth.
This is why the data that shows the 2% drop in production payrolls between 1999 and 2004 is somewhat startling. Data predating the Second World War shows a steady rise right up until the latest figures given which is 2000.
There's no ramp up for war (either WWII or Korea, Vietnam, the gulf, nada!) There's no visible build up even during the Reagan years when our enormous military buildup is credited with causing the collapse of the Soviet Union!
Should add this to things that make you go hmmn.
Nor do manufacturing employment figures drop at all when you look at the years our (once world-renowned) machine tool industry was devastated by the Japanese.
Bridgeport, Brown & Sharpe, Cincinatti, New Britain, and a host of others shed tens of thousands of employees across the nation yet the data shows a steady rise in manufacturing employment...along with steady growth in the `not in the workforce' figures.
It's not until 2001 that a long term downward trend can be observed. You can obtain customized datasets from the BLS here.
Then of course we have the wage data that ignores our non-existent inflation figures...
Who's zooming who?
Strong economy? I don't see it. A strong economy produces an abundance of consumer goods, ours produces next to none.
The employment chart shows me a society that is slowly devouring itself from the bottom up.
Most of our workforce is shuffling electrons, the next largest segment is working the take out counter, followed by bartenders and waitresses who serve the bakers and candy makers stiff drinks at the end of a hard day.
Only 5.1 percent of our workforce are employed in life science, computer science or engineering, the big three saviors of our modern economy. This figure is up .3% from 1999 when it stood at 4.8%
Is it more telling to observe that employment in financial services has grown from 3.4% in 1999 to 4% in 2004?
God knows what it is today, back in 2005 you couldn't throw a rock without hitting a mortgage broker...
Sorry for this long diary, it's a shame to have you read all of this only to offer the conclusion that the data is being massaged big time, a picture of economic health where there isn't one.
Thanks for letting me inside your head,