'The Great Resignation': June's US jobs report hides unusual trend

[marmar]

(Guardian UK) The Bureau of Labor Statistics reported on Friday that the US economy added 850,000 jobs last month. Hidden by this encouraging figure is the hint of an unusual trend: people are beginning to quit their jobs in extraordinary numbers.

June’s numbers, in combination with last month’s figures, suggest that the economy is continuing to recover at a steady pace. The rate of unemployment was 5.9% and 9.5 million people remain unemployed.

This latest update, along with projections of positive economic growth, was met with notable optimism from the White House and record highs on Wall Street.

Joe Biden, in response to the report, was eager to point out the changing power dynamic of the labor market.

“The strength of our economy is helping us flip the script. Instead of workers competing with each other for jobs that are scarce, employers are competing with each other to attract workers,” he said. ...........(more)

https://www.theguardian.com/business/2021/jul/03/us-jobs-report-june-trend

[spooky3]

1. The authors' own graph suggests that the # of resignations isn't much higher than it was

pre-pandemic. Since many people were too scared to resign during the pandemic, it's not surprising that the number is a little higher. I think we have to wait a while to tell whether there is a trend.

[Warpy]

2. I said a couple of weeks ago that employees who were told to come back to the office

"or else" were probably going to choose "or else" over three hours a day in their cars in traffic, commuting from housing they could afford to where the job was located

I tried to avoid long commutes in Boston, but time on subways, buses and trains was a lot easier than sitting in traffic. I read a lot of books and knit a lot of sweaters commuting in Boston.

Here in NM, I chose an iffy neighborhood close to all health care areas. I'm still here..

[Hugin]

3. Here's my unlicensed and uncredentialled take on the phenomenon and why it is not reflected...

in the labor statistics, Warpy.

I realized what was going to happen a couple of months into the pandemic and posted on it a couple of times.

As usual, this is a bed of the Republican's own making.

Prior to the pandemic there was a huge swath of the working poor who, although many of them held multiple jobs which required an enormous chunk of their waking hours and more, weren't getting a living wage much less enough to support any sort of family. It has been thus for decades and for many in that condition their lives and the lives of their parents.

During the pseudo shut downs (proper closures weren't implemented anywhere in the US and our infection/mortality rates reflect that for all to see) these people found their lives weren't much different than before, but, maybe a little better because they had time with their families (those who have them) and to themselves. For the first time in their lives they controlled their lives and they weren't on the clock. They liked it, as it was new.

As to why the numbers don't reflect these missing people, the labor statistics have been malformed by mainly the Republicans to ignore those who aren't by a precise definition recently let go, seeking work, or on UI. If one doesn't fit within those exacting definitions, they are effectively invisible. Those who were in the service industries prior to the pandemic were used to this as the bulk of their income had come from tips. So, it was nothing new.

This trend is not reflected in the UI statistics and UI is not the carrot the Republicans seem to think it is. Because, over the last 50 years they've broken UI to the point these invisible people I'm talking about don't even consider it or care about it. During the last year and a half, I've tried to help several people obtain UI. (yes, I was fooled into thinking it was a safety net, too) What I found is that like the pre-pandemic work these people had been involved in obtaining UI is a full time job and in most jurisdictions even with the pandemic padding wasn't worth the effort it takes to stay on the program. The Republicans have made sure of this.

In the meantime, to survive these people have entered an invisible economy of pick up work. They're still working. Now, like before, they live in daily gig jobs. Where they are paid piecemeal. Like before, their day's wages depend on the moment-by-moment gratuity of who they are working for and nobody seems to be complaining about it. Plus, the added benefit of the people being able to work for whom they want, where they want, and when they want. Without the leash of an employer who really never did anything for them previously. Except, take a cut of their tips. So, what has happened is a libertarian's (note the lower case 'l') utopia.

Is anyone surprised to find out that those Capitalist who formerly described themselves as Libertarians have found out they don't like a libertarian system as much as they thought they would or Ayn Rand said they would. John Galt is not on the supply side of labor.

[Warpy]

4. It's true that poor people with a patchwork of jobs

were never properly counted. It;s true that daily gig work has never been counted.

I don't think this is being driven by poor folks. I think this is being driven by the middling sort.

What the poor are doing is basically striking for better wages in food service and retail. These sectors can't find workers because they won't pay them. They're sp used to getting a free ride that they'd rather go out of business than pay them.

If we want any sort of a working economy, wages at the bottom need to rise. If the pandemic taught us anything, it taught us who the essential workers really were, and it's not the hedge fund guys. This needs to be recognized monetarily.

[Hugin]

5. Precisely.

One thing I discovered that I failed to mention is that the UI one qualifies for is based on the wages they officially received.

So, those people who are making $2.50/hour as servers. That's what their UI would be. Plus, the middling pandemic padding. So, still not a living wage and definitely not worth standing in line for.

[progree]

6. The unemployment rate does not come from unemployment insurance statistics

The count of the unemployed and the unemployment rate is NOT a count of those receiving unemployment benefits, nor is unemployment benefit receiver status factored at all into any of the official national unemployment rate statistics (U1, U2, U3, U4, U5, U6). Rather, the national unemployment rate is based on a survey of 60,000 households chosen at random. See: http://www.bls.gov/cps/cps_htgm.htm (and search the page for the word "insurance" ) or Google the below line::
"How the Government Measures Unemployment" cps_htgm.htm
and search the page for the word "insurance"

People in the survey are counted as unemployed (and thus part of the official (U3) unemployment rate) if they are jobless and looked for work some time in the past 4 weeks. They are counted as unemployed in the U4, U5, and U6 statistics if they looked for work some time in the past 12 months. It has nothing at all to do with whether they are collecting unemployment benefits or not, or how long they have been unemployed.

(Although those who are not collecting unemployment benefits have more of an incentive to seriously seek work than those who are)

How they answer the survey taker's questions is what determines the unemployment rate. (EDit: and whether they answer the phone or not and agree or not to take/complete the survey. A factor that might affect marginalized workers more)

Edit: The self-employed and gig workers in general are counted too.

Edit: How long one has been out of work has nothing to do with it either. In U3-U6, if you told the surveyor you were looking for work in the last 2 weeks, and were ready to take a job, you are counted, even if you haven't worked for pay/income for decades.

Edit: I don't disagree with anything you said about the deficiencies of the UI system.

[Hugin]

7. My point is... The way it's counted is not only wrong, it's deliberately wrong.

There's the paper way and the real world.

I have been introduced to the real world over the last year and a half.

What's the problem with doing away with all of the fancy book keeping and finding out what is an issue to those who need help?

[progree]

8. How is the way the BLS determines the unemployment rate wrong and deliberately wrong?

I can think of some things that are quite questionable, and give a misleading picture, but wanted to get your take on it first.
Thanks

Just wanted to clear up the widespread myth that the unemployment rate comes from the UI numbers. It doesn't.

As for the UI system being screwed up, I agree. (Edit: and they, mostly with Republican admins, deliberately made it hard to qualify, and benefits meager)

[Hugin]

9. The way the BLS determines unemployment is like counting the number of people who are...

playing poker and saying it's the number of people who are gambling. It in no way reflects economic participation. Because, even if they aren't counted as having tightly defined employment people are going to find a way to survive. To survive they are going to have to interact with the economy. They do not go away, if their job goes away. Although, apparently the Republicans wish they would. Because, then they couldn't vote.

It is very much the same thing as considering the stock indexes alone to gauge the health of the economy. Don't get me started on that bugaboo.

Yes, when the BLS says employment is up, it's a good thing and I'm happy. When it goes down, I'm now going to have to watch other things to see what people are doing and most of those other things don't have established metrics and public agencies to track them to provide data. Except, maybe crime.

Another famous example of this statistical fallacy is when the percentage of people having sex during a period of time is calculated and the only metric that can be agreed upon to reflect this is the number of women who have given birth. Because, they are sure that at least those people have had sex at least once in the preceding nine months. Much is lost, in other words.

progree, I appreciate it when you challenge my assertions. Because, I know you know what you're talking about. (this does not apply to the TROLLS out there) By challenging my argument, you're making it stronger. That's called debate and it is a good thing, if it leads to a solution. (which, in my particular case never happens) It is the part of the scientific method nobody gives much attention to these days. Objective peer review is a critical part of the process. Humans are fallible and iteration with refinement are the way beyond broken solutions. Dunning–Kruger, anyone?

[progree]

11. I'm confused about the "tightly defined employment"

Because, even if they aren't counted as having tightly defined employment people are going to find a way to survive.

(emphasis added by Progree)

If anything, it seems what counts as employed is kind of loose in "How the Government Measures Unemployment" http://www.bls.gov/cps/cps_htgm.htm

The people conducting the Household Survey that ask the questions that produce the unemployment rate and other statistics that come out the first Friday of the month don't ask the same questions that the UI people do.

The Household surveyors do later ask questions about occupation and industry ... at that point if someone is selling drugs or sex, I would guess they would either lie about what they do, or hang up. But for people doing marginal but legal gig work, piece work, part-time, etc., I don't see why they wouldn't answer the questions and be properly categorized.

I'm not saying any of this is perfect. It's human beings following a script asking human beings questions. It is what it is. I obviously take it quite seriously considering how much time and effort I've put into the "DU web page" in my sig line ( http://www.democraticunderground.com/111622439 for those who have signature lines turned off, like I do ), and taking part in the first Friday LBN jobs report posting, which is quite a long haul most times, glad its only once a month.

There are several alternative measures of unemployment. None are perfect, they also are the result of humans asking humans questions.

Unemployment rate: U1, U2, U3, U4, U5, U6 - Table A-15. Alternative measures of labor underutitlization
http://www.bls.gov/news.release/empsit.t15.htm
Definitions: http://www.bls.gov/lau/stalt.htm

I particularly U-6, the "underemployment rate" that counts people who work part time but want full time work as underemployed.
http://data.bls.gov/timeseries/LNS13327709

Paul Solmon of PBS used to calculate an unemployment rate based on asking jobless people, "do you want a job"? It also counted part-time people wanting full time work as unemployed in this measure. (That can be obtained from the BLS statistics).

I also look at the prime age (age 25-54) labor force participation rate with great interest (these are people who are employed or actively looking for work):

All: http://data.bls.gov/timeseries/LNS11300060
Men: http://data.bls.gov/timeseries/LNS11300061
Women: http://data.bls.gov/timeseries/LNS11300062


===========================================================

Thanks for the kind words in the last paragraph. Just to pick one sentence.

Because, I know you know what you're talking about

I know some about this, but there's a lot I don't know and a lot of things I question and am confused about in my long dive in the employment statistics. And some doesn't make sense.

Or borrowing from the recently deceased Donald Rumsfeld --

there are known knowns; there are things we know we know. We also know there are known unknowns; that is to say we know there are some things we do not know. But there are also unknown unknowns—the ones we don't know we don't know. And if one looks throughout the history of our country and other free countries, it is the latter category that tends to be the difficult ones.

[progree]

10. Whoops, posted in the wrong spot, deleted, sorry /nt