Friday, October 18, 2019

Two Sources of Privacy Attacks: Satellites and Interconnections

I had just finished looking over a piece from Slate, September 19th’s “You Don’t Want Facebook Involved With Your Health Care” by Kirsten Ostherr, when I discovered a related one.  That was “Are We Ready for Satellites That See Our Every Move?”, by Sarah Parcak in the October 15th New York Times.

The effect of their material has much in common.  Both are progressing rapidly, both are behind the scenes as most Americans perceive them, and both can be used for much more than these articles suggested.  As well, both have real potential to get out of control.

The first showed that seemingly unrelated websites could combine their personal data troves to provide further information on individual health care decisions.  Its first sentence, “could your Netflix viewing habits predict that you will develop inflammatory bowel disease?”, may seem silly, but there are correlations everywhere.  Some of these statistical relationships are meaningful, as, for example, the purchase of Tums and Mylanta going along with stomach discomfort.  Some describe situations which are not as they seem, such as the high rates of respiratory problems in southwestern states not meaning problems with Arizona or New Mexico but the opposite, as many people with such issues choose to move there.  Many more, probably most, correlations come from “hidden variables” which affect both factors in the same day, such as, as I have written about, the lower likelihood of female high school athletes using illegal drugs, both actually in large part from higher social class.  Some are splendidly meaningless, such as the long-lasting extremely close relationship a sociologist documented between population in the Indian state of Hyderabad and membership in the International Machinists Union.   These bogus correlations fool a lot of smart people, and an almost infinite number can be found when comparing the contents of large databases.  Accordingly, even if there is no sensible real-life connection between choice of movies watched and diseases, it may look as if there is.  That is scary.

The scope of such data excursions goes well beyond recommending unjustified medical treatments.  The article mentions the possibility, which I have long since noted, that purchases of some products could trigger verdicts of poor health practices, leading to higher insurance premiums.  Some are easy to see, such as those buying motorcycle equipment tending to have higher fatal accident rates.  Some may or may not have merit, such as people acquiring more than a certain amount of bacon or butter having an increased chance of heart problems.  Some will depend on current views about food safety, which, like the 1990s oat bran craze, may only later be shown to be erroneous.  And most if not all are susceptible to failing to identify purchases for others; a father buying his son racing car parts may come through as the one with the risky lifestyle. 

While health care and health insurance costs are real issues, there are plenty more where such data could be generated and then used both fairly and unfairly.  A short brainstorming session got me auto insurance (higher rates for people buying a lot of beer), renting decisions (that and other things associated with rowdy lifestyles), credit-related decisions (what might be deemed excessive spending on non-necessities), membership organization acceptance (opinions they don’t like), employment decisions (already being made, based on anything that could interfere too much with work), or anything else where they know even only your name and address (this time, you say what would stop them).

Parcak’s work described how satellites, which 15 years ago could clearly “see things the size of 40-inch TVs” and can now handle “those the size of smart tablets.”  A big difference as, for one reason, the new capability includes viewing license plates.  Anything not indoors, including you and I much of the time, can be observed and followed, leading to combination with other information to predict future activity, including that none of the authorities’ business.

The real long-term problem with both forms of tracking is not a lack of privacy.  It’s enforcement of conformity.  As we are seeing now with Chinese efforts giving people points for displaying what their government considers socially positive behaviors, we can be motivated with money to do the same.  From there it’s just one step to the political party in power incorporating their ideology as well.  And what will stop it?  The best outcome might be what I think now exists on a smaller scale, where police departments use information, either legally or illegally obtained, to catch criminals, but little else is actually done with it.  If that continues it would hardly be harmless – police do make mistakes – but would be the most positive we can hope for.  From there, we will as always need to do the best we can. 

Friday, October 11, 2019

Good, Bad, and Unspecified Jobs Over The Past Six Weeks: Subtexts, News, and Observations

Since the last week of August, we’ve had all three of the above.  What am I talking about?

In TechCrunch on August 28th, we learned from Megan Rose Dickey that “Uber proposes policy that would pay drivers a minimum wage of $21 per hour while on a trip.”  Of course that offering was not altruistic – it was in response to a protest, in which drivers were hoisting signs expressing discontent with the company’s high CEO pay, lack of dignity (whatever that was intended to mean), and low income.  As any past or present taxi driver can tell you, this proposal doesn’t mean much, as it’s an unusual day if the meter or the equivalent runs for more than half the time, and one-third is common.  Announcing this sort of thing will not help ridesharers in any way, and begs a question:  Why can’t Uber management manage better?

A rather more salutary related idea made the September 11th New York Times editorial page, in “Take That ‘Gig’ and Shove It.”  The board weighed in again, on the right side, of the contractors vs. employees matter, endorsing a California State Assembly bill that “imposes strict limits on who can be classified as a contractor.”  In office settings It is usually hard to stop companies from “hiring large numbers of contractors whom they have treated as an inferior grade of employee,” but the ridesharers, with their rules and restrictions, clearly differ.  The three standards the bill requires for non-employee status, autonomous labor, freedom to work for others, and doing tasks “not central to the company’s business,” if passed into law, would put an abrupt end to talk of their dependent front-line drivers being contractors.  This bill should and probably will succeed, and from there will spread.

Good news on jobs was the subject of a piece in the local-to-here September 12-18 River Reporter, Fritz Mayer’s “If you’re ready for a job, you can get one in Sullivan.”  The director of the Center for Work Force Development in this New York county with a most recent 3.4% unemployment rate calls the labor market “very tight,” and said that healthcare and retail food service jobs were most plentiful.  A boon to the area, which will help more people work, is the recently started county bus service, hardly something to take for granted in a place with well under 100,000 scattered residents – that has increased the number of available workers, which the area can certainly handle right now.  The largest concern, implicit here, is how much these jobs actually pay.

“To Raise Wages, Make Companies Compete for Workers”?  Isn’t what the New York Times Editorial Board advocated on September 19th happening anyway?  Apparently not always, with “the absurd and harmful proliferation” of even low-level employees being required to sign noncompete agreements.  Once something only top engineers and planners need consent to, the limits are now imposed on 30% of salon-employed hair stylists, and when they were sharply limited by law, as in Oregon, employees not only changed jobs more freely but earned more.  With such agreements common for workers paid less than $23,360 per year, as shown by a New York bill barring them for people below that level, they have got out of hand, and employers may soon find that their right to impose them has been slashed.

Related to my August piece on the lives of the 1% was Louis Menand’s September 30th New Yorker “Is Meritocracy Making Everyone Miserable?”.  Indeed, Menand also cited Daniel Markovits, in this case his book, The Meritocracy Trap, the basis of that post’s main article.  While Menand therein gave that a poor review, calling it “bombastic” and “repetitive,” he agreed with most of what I named last time and hit many more, including the $148 billion annual higher-education taxpayer support, the huge 60-year increase of the average lifetime earnings boost for college graduates, problems with “meritocracy” blamed on it being “not meritocratic enough,” the narrow overall scope shown by 12 highly selective schools having fewer than 1 in 200 undergraduates, the decreasing and often insufficient funding for lower-level colleges, the differences between affirmative action by group and by income, and preferential treatment begetting more of the same.  One good Menand counterpoint was that discrimination to the point of complete bans against women and blacks is now gone, and three issues he mentioned were more controversial than he made them out to be:  the held-as-false idea that those in the 1% think they earned what they got (it may be unfair that they unlike others of similar inherent aptitude were put on a track for it from preschool, but they still worked extremely hard), that much of the sorting process happens during college (I think we are already, per grade inflation, getting a Japanese-style system where high school students put in the most effort and the prestige of universities will carry their students on from there by itself), and the problems with SAT scores reflecting social class (they would correlate heavily, also, with number of books at home).  This Menand piece may provoke your thinking as well – as should the other four articles discussed here. 

Friday, October 4, 2019

No Recession Here: American Job Shortage Number Down 1.1 Million On Broad-Based Improvement To 15.1 Million, With Unemployment Rates Still Falling

At first glance, this morning’s Bureau of Labor Statistics Employment Situation Summary looked as expected.  The number of net new nonfarm positions couldn’t have been much closer to a published consensus 140,000 projection with 136,000, and other changes seemed small.  Yet beyond that, which roughly matched American population growth, this September report was deceptively good.

Although the official joblessness rate has been overrated for most of the past half-century, it still means something, and its 3.5% adjusted result was the lowest in almost 50 years.  The unadjusted 3.3%, lower since September is an above-average month for people working, was much the same.  We’re now at 5.8 million unemployed (5.465 million unadjusted), and the two measures of how common it is for Americans to have jobs, the labor force participation rate and the employment-population ratio, did fine also, given that they each gained 0.2% in August, by staying at 63.2% and rising 0.1% to 61.0% respectively. 

There was bad news as well.  The count of people out of work for 27 weeks or longer gained 100,000 to reach 1.3 million.  The number of those working part-time for economic reasons, or holding on to short-hours positions while unsuccessfully seeking a full-time proposition, held at 4.4 million, but did not lose back any of its 400,000 August gain.  Average private nonfarm payroll earnings, after rising a good but unspectacular 11 cents per hour last time, lost 2 cents and are now at $28.09.  This number has been outperforming inflation, but one more like month will push it down to constant-dollar breakeven for the year. 
The American Job Shortage Number or AJSN, the measure showing how many more positions could be quickly filled if all knew they were easy to get, lost and thereby improved a stunning 1.08 million, some but not all seasonal (the AJSN is unadjusted), reaching a 17-year low as follows:

Over 60% of that was from lower official unemployment, but more than 400,000 was cut elsewhere, mainly from those wanting to work but not looking for it for the previous year (a 273,000 net latent demand drop), and those calling themselves discouraged (131,400 down).  Compared with a year before, the AJSN is down over 500,000, over half from reduced unemployment and the rest spread out among 8 of the 9 other categories above, all of which have fewer people than in September 2018.  The share of the AJSN coming from those in the main jobless category is now 32.6%, once again below one-third and the lowest since May.  Latent employment demand from those claiming no interest in work is now less than 8% below that from official unemployment, and if the latter keeps dropping the two could converge.

How do we evaluate September?  The number of new jobs was lukewarm again, and the loss in wages sad, but I like the other-category improvement too much to call it bad.  Not great by any means, and maybe not even encouraging, but we’re still advancing.  Maybe we’re going to get a recession within the next several months, but real signs of that in this report are absent.  Small again, but the turtle yet again took a step forward.

Friday, September 27, 2019

For Overlooked Countries: Eight Ways to Make Travel Easier

It’s not a common subject on this blog, but for a couple of decades I have been visiting places around the globe.  I have now set foot in 58 countries, in all of the continental groups except Antarctica – while my patterns are more frugal than most Americans, perhaps more akin to those of Europeans with more vacation time than money, they are common worldwide.  Travel is not a main source for writing on American employment, but it is related in that tourism has, during all of our lifetimes, been an ever-rising source of jobs; visitor appeal greatly controls how many are working in certain industries, and many more officials would prefer more outsiders coming in and spending money to fewer.  What relatively inexpensive things can destinations, especially but not exclusively the foreign ones which spurred my thinking here, do to get more of that?

First, consistently have and maintain street name signs.  When asked on an exit form what a small island country could do to make my experience better, I wrote “street signs” in capitals, underlined twice, and with three exclamation points.  Those of us who like to walk around can otherwise be blown off course remarkably easily.  And don’t they want them for the locals anyway?

Second, have some sort of competence test for cabdrivers.  It’s infuriating, as I did in this same place, after being pestered constantly by touts of “Taxi?” “Taxi?,” to finally get in one and find the driver, who seems to know English or the other language I’m speaking perfectly well, does not know locations of even the most popular tourist destinations.  If there is such an oversupply of cabs that drivers will often wait an hour or more for customers to finish their sightseeing so they can get another few dollars taking them elsewhere, then, say, a written exam on where things are would correct that as well.

Third, and this time I speak to the most developed places on the planet, have nothing for visitors requiring mobile phones.  I know, we can buy SIM cards, but using such technology also necessitates having such devices on hand, paying roaming charges, getting a clear signal, understanding dialing codes, and more.  With no country close to 100% cellphone saturation anyway, a modicum of pay phones, which have reached near or total nonexistence in some places, could also help travelers more.

Fourth, have more places of any kind to sit down.  To make the same points I made in academia last decade, populations are aging, people often need a few minutes to rest, and concrete benches can last for 50 years.  While loitering is a reasonable thing to discourage, the value to others will soon, if it hasn’t already, more than offset that.

Fifth, facilitate low-priced private room lodging.  Such offerings are nongovernmental-money decisions, but public policy, as shown in countries with few even rural options below maybe US$100 per night, can influence that.  And I’m not talking about Airbnb or other sharing options either, which can seem confusing and offer communication insufficient to many.

Sixth, accept cash everywhere.  Even in the United States, where customer needs have recently caused restaurants taking only electronic payments to change that, many erroneously assume that visitors will be as well-equipped as locals, who pay no credit card transaction fees and have any commonly used small-change-replacement systems (such as Hong Kong’s Octopus transit cards, extensively used in convenience stores).  I’m with a horde of people who use ATMs, themselves becoming less common at some destinations, and then spend as they go, not only getting lower fees but enjoying seeing the local money.  It would be sad to go to Australia and never see the kangaroos, platypus, echidna, and other designs on their everyday coins and notes.

Seventh, have free local maps available anywhere tourists might go.  Advertisements from their sponsors are fine, and are often actually helpful, but please keep them to scale, show what that scale is, and leave in streets or roads even if judged to be of no visitor interest.  Maps, especially in conjunction with good street signs, have no real substitute.

Eighth, and this is where our home country is the worst, have plenty of public toilets.  Walking around without frequent restaurant or museum stops brings this human need to the forefront.  These places need only be reasonably clean and open at all or almost all times.  If they want to, as many do, charge what is almost always a nominal amount, that is no problem (if they can make change!), though businesses, who see gains in sales when people can wander around longer, could pay for them.  One of the largest American portable toilet providers uses the name Comfort House for a reason.

Although some would need to come from changes in laws or company regulations, none of these improvements would be, in the long term, time-consuming or expensive.  All would boost tourism jobs and business income more efficiently than public relations campaigns.  Through online as well as in-person communication, word spreads more than ever before about the merits of Taiwan versus South Korea, or even, and especially, Fiji against Samoa.  Work and money are good things – when it’s relatively easy, let’s do what we can to get more of both.

Friday, September 20, 2019

Uber and Lyft: Heading Toward the End of the Road?

It’s not looking good for America’s premier gypsy cab companies.

In the December 5th, we saw “Uber, Lyft drivers get $17.22 hourly wage guarantee in New York after commission’s vote.”  This move was made by “taxi regulators” who claimed the move would “raise drivers’ annual earnings by $10,000 a year, making it the first U.S. city to set such minimum pay standards.”  That is believable, but since the move makes no mention of that amount being over their expenses, be they average or specific, it cannot be confused with the net $34,000-plus annual pay it would get an ordinary wage earner over a year of 40-hour weeks.  Uber, as expected, cried about that, saying it would cause “higher than necessary fare increases for riders,” which can indeed be the result of workers paid appropriate amounts, “while missing an opportunity to deal with congestion in Manhattan’s central business district” (even if cars trying for Uber fares, some paid by people who would otherwise take buses or subways, actually had that effect, it strains credulity to think that is this company, proven to be as mercenary as any Soldier of Fortune contributor, highly values that).

Six months later, on June 2nd, we got the New York Times’s “Path to Ride-Share Profits Begins With Higher Prices.”  Author Austan Goolsbee started by contrasting Uber and Lyft market capitalization, then $80 billion, with their loss of “a great deal of money,” since then worsened by Uber dropping $5.2 billion in the second quarter and both companies’ capitalization falling to $68 billion.  Per Goolsbee, passengers are less sensitive to the fare increases these companies seem to need than drivers are to the pay raises they would provide.  However, with riders having many alternative ways of getting places, the effect would be significant, and we don’t know how much further the results of a study, that “for every 10 percent increase in price, demand fell by only about 5 percent,” could be extrapolated.  The author also said that drivers might otherwise be working for restaurants, meaning that their “average pay… is likely to end up around minimum wage, too.”  Taxi-commission edict or not, there is no reason for such workers to be getting anything approaching middle-class income – and the more they are paid, the fewer of them the market will need.

A third heavy shoe is about to drop.  As documented in “A fierce battle over defining employees in California nears decisive vote,” by John Myers, Liam Dillon, and Johana Bhuiyan in the September 7th Los Angeles Times, this week the California legislature will vote on a measure, known as Assembly Bill 5 or AB5, which, per “Why Uber and Lyft Are Pushing To Keep Their Drivers as Independent Contractors” by David Jagielski in the same date’s Motley Fool, would require three criteria for workers to be denied classification as employees:  they would need to be “free from the company’s control”; their work “can’t (be) part of the company’s core operations”; and such laborers “would need to have an independent business in the industry.”  Either of the second two would conclusively deny Uber and Lyft ability to keep treating their drivers, who would “receive sick days, have minimum-wage protections, and be eligible for other benefits,” as independent contractors.  As a result, those two and restaurant delivery service DoorDash have spent $90 billion fighting AB5, which would not only raise their expenses but would end much of “their flexibility and being able to have almost anyone being able to drive for them.”  Here also, these companies are looking at some combination of higher customer charges and losing even more money. 

Will Uber and Lyft ever become profitable?  Maybe if and when autonomous vehicles, now delayed and uncertain, arrive.  But it seems more likely that they cannot last that long.  So keep patronizing them if they help you, but choose other investment opportunities.

Friday, September 6, 2019

Friday AM: Some Jobs Numbers Still Improving, Some Advances Reversed, and AJSN Down 200,000 To 16.2 Million

This morning’s Bureau of Labor Statistics Employment Situation Summary was another mixed bag.  The headline number of net new nonfarm positions didn’t make its published 158,000 projection and turned in 130,000, close to what we need to cover population increase.  Seasonally adjusted unemployment remained, for the third straight month, at 3.7%.  The unadjusted version dropped 0.2%, mostly due to the typical difference between July and August, to 3.8%.  The adjusted number of jobless people fell 100,000 to 6.0 million, with those out for 27 weeks or longer holding at 1.2% and those working part-time for economic reasons, or working short-hours jobs while seeking thus far unsuccessfully full-time ones, gave up its June and July improvements and is now back at 4.4 million.  The two measures showing how common it is for Americans to be working, the labor force participation rate and the employment-population ratio, each gained 0.2%, with the former having its third straight improvement, to reach 63.2% and 60.9% respectively.  After a neutral month, average private nonfarm hourly wages came in at 13 cents more per hour than the previously announced result, and are now at $28.11.

The American Job Shortage Number or AJSN, the Royal Flush Press metric showing how many additional positions could be quickly filled if all knew that getting one would be routine and easy, went down 207,000, as follows:

The largest AJSN changes over July were those unemployed, cutting 317,000 from the total, followed by those discouraged and not wanting work at all, offsetting much of that with worsenings of 89,000 and 54,000.  The share of latent demand from those officially jobless fell to 34.5%, matching May’s outcome. 

Overall, how did we do?  The net effect was modest, with some measures, specifically the employment-population ratio and the labor force participation rate, continuing to improve, and others, such as the count of those working part-time for economic reasons, losing what I had hoped were sturdier gains.  With better results so common, the lukewarm – and that’s what it is, not the likes of “poor” or “skimpy” – 130,000 jobs gain is no cause for concern.  As there is so much latent demand, the wage improvement is nothing to take for granted.  We’ll continue to track the trends, and see which are real and which, as most of them these days, are only fluctuations.  In the meantime, though, the turtle took a tiny but real step forward.  

Friday, August 30, 2019

Glaciers, Gondolas, and Slot Machines: Attracting Tourism Jobs Means Making Tough Choices

There may be no area of employment more modern, substantial, and promising than catering to people traveling for pleasure.  For all the beefing about air travel conditions, fares are lower in constant dollars than they have ever been.  Worldwide prosperity, on average, is way up.  A shift from valuing objects to valuing experiences means that more and more people travel.  And the rise of the 1% has opened up a new high tier.

With that said, here are three places where that has not worked out as planned.  The first was featured in Peter S. Goodman and Liz Alderman’s August 25th New York Times “Iceland’s Purple Planes Are Grounded, and With Them, Its Economy.”  The piece, about a remarkably steep fall in that country’s number of visitors from discounter WOW going out of business, drew this immediate reaction from me:  Wait a minute!  Wasn’t it just yesterday that Icelanders were complaining about too much tourism?  Word was that visitors, often ill-mannered (of course), were overtaxing their delicate ecology, taking up too much Reykjavik space, preventing locals from getting hotel rooms when they themselves traveled, and so on.  And now “the sudden shortage of Americans – widely celebrated as a free-spending people – is bemoaned by merchants of Viking-themed tourist tchotkes (sic), by whale watching tour operators and by real estate agencies.”  Oh well.

The problem I have always sensed with Iceland’s tourist industry – and I have been there four times – is its ambivalence.  Some would like to make their country, the size of Kentucky with one-fourth the population of metropolitan Louisville, as close to an environmental preserve as sanely possible.  Others see its ample open spaces as opportunities to add industry and other businesses to help their standard of living.  It has often seemed gratuitously high-end to me, with a lack of bed and breakfasts and other low-priced non-hostel hotel rooms, little fast food, and sit-down restaurant meals seeming to start at about US$28 per person.  Except for the fine Bonus supermarket chain and a competitor or two, prices in stores will surprise you.  To sell more Eric the Red refrigerator magnets they can cut their $10 price in half with business-friendlier public policies… if they decide that’s what they want.

The opposite problem has plagued Venice.  Spearheaded by cruise ship passengers spending far less per capita than other visitors, they have just plain had too many – 36 million international ones alone, or 138 per permanent city resident, in 2017.  With demand for related goods and services distorting the business atmosphere the city runs the real risk of becoming a theme park, with a thousandth glass-animal shop pricing out the likes of a dry cleaner or an insurance agency.  Normally supply and demand would kick in, with hotel rooms and restaurants charging more, but with waterborne visitors not using much of either they have been able to clog the streets cheaply.  Two years ago the city banned large ships from docking, and next year they start a three-euro entrance fee for those not staying there, but those will only solve part of the problem – watch this classic destination for more developments.

The third tourism issue is here in the Catskills.  Locals clearly wanted the Resorts World casino, which, at my visit last year looked modern, busy, and full of people gambling, but it is losing so much money that the major stockholders are resorting to declaring bankruptcy, while staying open, to stiff its lenders and stay, at least for a while, in business.  Why has it done so poorly while seeming so good in principle and in real life?

One problem is that Resorts World, with what was a $129 per night hotel-room minimum, became yet another place failing to realize that one thing making Las Vegas great was its quantity of cheap accommodations, facilitating longer stays translating into more gambling.  Its publicity efforts have always seemed inadequate, without any massive push to bring in New York-area Jews with good childhood Catskills memories, and an apparently failed effort by the Malaysian owner to attract high-rolling Asians.  Prices such as the $16 nachos can also cut back repeat visits.  And, to keep bored patrons interested, like any other large casino it requires massive periodic infrastructure spending, meaning it needs way-high amounts of business just to break even. 

However, I suspect the largest problem is something else.  People came to 1950s and 1960s Las Vegas to gamble.  They would play, play, and play.  Long hours, as close to around the clock as they could stand.  Some thought they had systems assuring wins, but few people did that – it wasn’t called Lost Wages for nothing.  Gambling’s appeal is totally different now.  The GI and Silent generations forming not only the backbone but most of the body of Las Vegas punters have been replaced by Generation X and Millennials, who care for gambling vastly less.  Casinos are all over the country now, and the novelty is no more.  Instead of tacitly encouraging problem gambling, people who cannot handle it see a variety of announcements offering them help, including the option to bar themselves.  Roulette, blackjack, craps, and slot machines, after 70 years still the mainstays, are all old hat now.  It has become the norm for people to both know intellectually and feel emotionally that they cannot win over the long term.  Low-stakes entry points, such as $20 buy-in poker and nickel slots that don’t try to get people to play 20, 50, or 100 coins at a time, have gone away.  The clank of coins into metal trays is a thing of the past.  Despite, or maybe even because of, the proliferation of American and world casinos, gambling itself is in big trouble – the choice here is how casinos can change to accommodate that.

Obviously, tourism will continue to grow – but in what ways?  We will see.  Not all the jobs it generates will remain.  We wish it the best, but it may have many more hard times ahead.