Thursday, December 31, 2015

New Year’s Resolutions on Jobs and Beyond We’d Like to See

Our annual promises to ourselves have three requirements which are both necessary and sufficient.  First, they must be things we can personally control – no fair, for example, resolving to win the lottery.  Second, they must be beneficial to those doing them, which precludes such as starting smoking.  Third, and most importantly of all, they must be plans on which the person has no intention of following through. 

In that spirit, what would be suitable proposals from the major players, and groups of players, in American employment?  Here’s what Royal Flush Press suggests. 

President Barack Obama:  As long as my country could quickly fill more than 15 million additional work opportunities, as shown by the American Job Shortage Number (AJSN), I will push for increases in their quantity, and let their quality take care of itself.

Republican Presidential Candidates:  I will help keep America great by supporting a massive infrastructure repair and improvement project, which will create millions of jobs in the process.

Democratic Presidential Candidates:  I will fight for ALL United States citizens to have better opportunities to work and support themselves, even straight white Anglo men, and not just to improve life for existing employees.

Speaker of the House Paul Ryan:  I will coordinate the Republican representatives to do what is right for overall American prosperity, not just for people with the top 1% of income or net worth.

Columnist Paul Krugman:  I will use my Nobel Prize-caliber skills as an economist to encourage better jobs policy, even if it disagrees with liberal orthodoxy.

Columnist Charles Krauthammer:  I will make my criticism of Obama less incessant and move on to other topics, including jobs and the economy, at which I can be constructively influential.

Janet Yellen and the Federal Reserve:  Until the AJSN tells us we are fewer than 15 million jobs short, we will neither raise interest rates again nor threaten to do so.

New Hampshire and Iowa Republican Voters and Caucus Participants:  We will vote for a genuine, reasonably experienced candidate who understands that politics involves deal-making and compromises.

New York Times Editorial Board:  We will get educated about cost-of-living differences around our country before again proposing that all jobs everywhere must pay at least half-again as much as what countless unemployed and underemployed Americans in the hinterlands would be delighted to work for.

Employers:  We will stop crying about skills gaps and labor shortages, and train inexperienced workers, pay market rates for experienced ones, or both. 

Me, and everyone else:  As the Moody Blues put it 47 years ago:  Keep as cool as you can.  Face piles and piles of trials with smiles.  It riles them to believe that you perceive the web they weave.  And keep on thinking free (emphasis mine).

Happy New Year, everyone!

Wednesday, December 23, 2015

The Year in Jobs – Good, Bad, and Just Different

Historians, if they care, will say that 2015 was a slow year on the employment front.  It was more than that, though, and those of us who lived through it know what else was afoot. 

The best news came from the statistics.  In the latest available year-over-year comparison, November 2014 and 2015, official unemployment dropped over one million.  The number of discouraged workers fell 100,000, and those in other marginally attached categories were off as well, led by the count of people wanting work but not trying for it for a year or more down almost 400,000.  The long-term unemployed, or those out for 27 weeks or longer and still looking, were off 25 percent from 2.8 million to 2.1 million, and the number of people working part-time for economic reasons, or wanting a full-time opportunity but not finding one, improved from 6.9 million to 5.8 million.  The AJSN (American Job Shortage Number), showing latent employment demand, dropped more than 1.3 million to another post-recession low, but tells us our country could still fill more than 17.2 million additional positions.  Average private-sector pay improved modestly but more than inflation, up 2.1% from $24.66 per hour to $25.20.  On the other side, those saying they did not want a job kept rising and ended up more than 2.7 million to 89 million, and labor force participation was off from 62.8% to 62.4%.

A good year can mean few efforts to improve, and that is what happened otherwise.  On the jobs front, President Barack Obama’s administration did almost nothing.  Proposals from Democrats consistently missed the mark, with an overemphasis on different average pay between the sexes, a totally unrefined number reflecting literally dozens of factors other than discrimination, and higher minimum wages, which can only cut the amount of work.  When 2016 presidential candidate Hillary Clinton, as her competitor Bernie Sanders had done before, proposed the large infrastructure building plan our country badly needs, she hit a sour note by saying it should create vast numbers of middle-class jobs, which all but assures that even a moderately conservative legislature will reject it.  The Republicans offered a mixed bag on how to improve work and the economy, ranging from removing anti-employment regulations (great, but why are they there now?) and comprehensively maximizing both renewable and non-renewable energy resources (good), to cutting corporate taxes (companies are cash-rich as it is) and repealing Obamacare, maybe in their heart of hearts to replace it with nothing (as bad an idea for employment as it is for our country’s health).  The Federal Reserve acted as if there was a tidal pull to raise interest rates, and not only did that but discussed doing it again in a few months, which not only gratuitously endangered stock prices but showed they can’t stand prosperity. 

Some things this year simply changed.  While 3D printing went nowhere widespread, drones and self-driving cars roared to the front of technological progress news, and by this time two years from now are more or less certain to be replacing human workers.  The sharing economy, headed by gypsy cab networks Uber and Lyft and semi-legal hotel service Airbnb, continued to grow and grab headlines, but their peak may be in sight, with their managements now trying to fight off being forced to join the adult business world through unionization and required working condition improvements.  The acceptability of paying people to complete various chores, through the likes of TaskRabbit, seemed to spill over into normal jobs, with companies as large and established as Target and The Gap taking to telling their employees minutes in advance that they will neither be working nor earning money that day.  Unlike such now-implemented developments as robot sobriety-checking bartenders, the stories about what might be called Amazon’s office-job intensity made front pages, reminding us how simple supply and demand can make jobs ever more demanding.  A flock of articles on the best and worst cities for careers documented that internal United States differences are as large as ever, and showed us that the recent principle of the Sun Belt being optimal no longer holds, with former easy-job standbys Orlando and Las Vegas now well behind the likes of once rusty Pittsburgh.   

So what’s coming up in 2016?  I hope we can continue to avoid a recession, but we may not, as even if our public policy and private decisions prove well-tuned, both closely connected China and Europe are in trouble.  Education’s role in getting jobs will attract even more attention, with students and their parents increasingly incisive about the true values of the many choices.  With no trends or new tax laws to stop it or even slow it down, economic inequality, and with it the pooling up of money in corporations and the very wealthiest people, will get more extreme.  Because of that, the Fed will discover that no matter how much cash is in circulation, inflation will barely if at all challenge two percent, and months after they send interest rates up again they will bring them back down, when lower job creation numbers and increasing official unemployment scare them.  Somebody will get elected president and, according to the oddsmakers backing up their predictions with money, it will probably be Clinton.  That will mean either four or eight years of the same course we have been on, for better or worse, but with the jobs crisis not likely to stay muted.  As the numbers say, we have been lucky with American employment – may that continue for as long as it can.                          


Friday, December 18, 2015

Nothing Special, Santa – Just What We Thought We Were Getting

Remember the excitement of the New York state casino referendum?  We had discussion, editorials, public comments, and people taking sides.  The Yes one prevailed, with the shares of votes for legal non-Indian gambling houses largest in the areas that stood to get them.  Our county, Sullivan, where it was almost a foregone conclusion that one of the casinos would be sanctioned, topped the state with 76% approving, and areas near Monticello, its expected location, went over 80%. 

That was 25 months ago.  So where are we now?

As expected, a year later the New York State Gaming Commission approved a gambling resort for Sullivan County.  They then said the winning Montreign Resort Casino at Adelaar would get its operating license by the end of 2015 at latest.

With only 13 days remaining, the license has not yet been issued.  And it does not look good for this year – since then the commission has backed off on its self-imposed deadline, saying more recently only that “it is possible” that this formal authorization will be issued in 2015.  Meanwhile, only land clearing and some excavation has been completed on the site, and 100 construction-related workers of the over 1,000 expected have been on the job, as Adelaar’s financing, and with it the ability to build, is contingent on the license.  On December 13th Scott Samuelson, Sullivan County Legislature chairman, sent a letter to the commission’s executive director Rob Williams, citing “mounting frustration” and perceptions of “deep-rooted skepticism.”  Williams’s prompt response claimed that “there is no delay” and that the process for issuing the license was “on track,” but offered no new deadline and no explanation of why it has taken as long as it has. 

So what exactly are the problems with the license delay?  There are at least three.

First, it is delaying casino job creation, way beyond the missing 900-plus construction workers who would otherwise be onsite during what has been a snow-free and unusually mild December.  People hoping to be among the 1,200 working at the finished installation are also being put on hold, with any having plans to be on the job by, say, late 2017 (the state requires the gambling facility to be up and running within two years of license issuance) now needing to postpone them. 

Second, it is affecting many more potential and actual employers in the same way.  Businesses which planned for sales to those missing builders are not getting them.  Housing to accommodate new workers is not going up.  The parts of the Adelaar resort beyond the casino-hotel, previously expected to provide hundreds of additional positions, are also on hold.  The license delay is probably also a reason for the apparent lack of progress on and total lack of communication from the nearby Veria Lifestyle resort and wellness center for which ground was broken earlier this year, which would share many customers with Adelaar.  Overall, as State Senator John Bonacic put it, “the delay is hurting the economic vitality in Sullivan County.”
Third, as Samuelson said in his letter, people here are starting to wonder, right or wrong, if the casino will actually materialize.  From the Monticello restaurant owner saying that after “waiting, waiting, waiting” local residents are “losing hope,” to a Montreign parent company executive comparing the current situation to casino licenses having “been spoken about In New York state since the days of Nelson Rockefeller,” emotional effects are appearing.  There is little historical reason for locals to be optimistic, especially given the lack of substantive official communication, and there is no shortage of reasonable if possibly uninformed questions about the process.  For example, if the gaming commission spent a year vetting over 30 casino applicants, to the point where they asked each for $1 million apiece to defray its cost, why are they, as they have admitted, still doing background checks, and why does it take more than double that time to investigate only the changes since then for 4?  Is it possible that there are political conflicts, fueled by those who do not agree with the referendum’s outcome, involved?  If there is still uncertainty about which casinos should be sanctioned in other areas of the state, especially in the Finger Lakes region, why must the Catskills be tethered to that?  Why is the commission no longer willing to communicate a firm deadline?  If there is a specific reason for the licenses to be unavailable by the end of this year, why can’t they share it?

So Santa, here’s what we in Sullivan County want for Christmas:  One license for gambling at the already voted-in, vetted, welcomed, eagerly awaited, and ground-cleared Montreign Resort Casino.  We’ve worked for it, we’ve been solidly convinced we’re going to get it, and it will cost almost nothing.  In “Santa Baby,” Eartha Kitt challenged you by saying “let’s see if you believe in me.”  Unlike Eartha, though, we don’t need a yacht, a platinum mine, or even a ’54 convertible.  All we need is what we have already been promised.   

Friday, December 11, 2015

How to Make Higher Education Work for You, and When Not To

Two weeks ago I wrote about the findings of professor and author Peter Cappelli in his recent book, Will College Pay Off?, on what is happening with American higher education and how it has dealt with students’ twin problems of ever-higher cost and worsening employment prospects.  Cappelli wrote that colleges and universities have reacted to them in two major ways.  To help the first by being more compatible with work, they have offered courses at unconventional times and places.  For the second, especially to address perceptions that their learners might not get hired after graduation, universities have created a variety of majors which sound more like individual courses or even job titles.  Examples from the book, to add to the four I named last time, are “turf and turfgrass management,” “economic crime investigation,” and “fire protection engineering.”  The more flexible teaching offerings have helped, but, according to Cappelli, the hyper-specific majors have not, as demand for such positions often changes dramatically in the years between choosing such a program and finishing it.  In the November 25 post I distilled the book down to these and five other points about how college has changed:  how they, especially community colleges, now provide most vocational training;  that there is no shortage of science, technology, engineering, and mathematics graduates;  that people may need to get degrees even when their targeted jobs don’t require them to compete with candidates with these higher qualifications but unemployed;  that it is hardly guaranteed that university degrees boost lifetime earnings;  and that college will not pay for itself for many of its attendees.   

Accordingly, the burden is on those considering college and university attendance to make the most of these new realities.  How can they do that?

First, prospective students should generally minimize borrowing.  That means choosing schools with lower costs net of other forms of financial aid, such as grants, scholarships, and campus work opportunities.  Second, that usually means using community colleges whenever possible, in three main ways:  for the first two years when the learner expects to get a four-year degree; for a two-year program when that is the only thing required to get into the student’s chosen field; and for vocational courses providing preparation for skilled trades and other areas not requiring degrees at all.  People can save a lot of money by starting at community colleges, and as more and more choose that option, the social life at such places, historically weaker than at four-year schools, will improve.  Third, they should avoid overly specialized majors.  A degree in management, including courses in areas of special interest, has potential to help in many directions, whereas one in turf and turfgrass management will limit options without a likely enough advantage.  Fourth, unless their families have the money to cover traditional university tuition, room, and board, first and second-year students should live at home if possible.  Even if their parents need money to cover some or all of their expenses, it is still the cheapest arrangement for all concerned.

Fifth, when considering careers, prospective students should look at how long they will last.  It is a waste of time and money, not to mention demoralizing, for people to prepare for work in fields that will not be available in the future.  The best predictors of career longevity, as I see them, are resistance to three things:  automation, foreign workers, and improved business efficiency.  Other factors may be chosen as more critical, but it is important to at least think about where Americans will actually be hired in 10 or 20 years, as opposed to in the immediate future.  Although I usually do not recommend lists of the best jobs, as they almost always take too short-term a view, one, “10 professions with the best job security,” recently published by Fidelity, is unusually perceptive, and avoids the traps of careers such as pharmacy and information technology which are doing well now but are headed for severe falls before today’s graduates turn 30.  This article is at

Sixth, if someone knows by their mid-teens that they are the kind of person who should be in business for himself or herself – and that was the case for most great entrepreneurs – they should not bother with a college degree program.  That universities would probably be delighted to admit them does not mean that is their best choice – in this case, it probably is not.

Seventh, if people find themselves with a real chance to get a legitimately good job out of high school, but had planned on continuing with school, they should consider taking the position, especially if it is with a company or industry which helps employees with college tuition, as they then may be able to complete their education later at a far lower cost. 
Eighth, when anyone chooses a college for a final degree they should pin schools down on placement rates and other measures of their graduates’ success, and assess them accordingly.  Nothing of substance to say or share on that topic in 2015 is bad news.

Ninth, in all this we should not forget that education is still valuable in itself.  Students should take opportunities to learn about different things, especially in liberal arts courses, which are available even at the great majority of community colleges.  What we learn in the likes of philosophy, sociology, psychology, and other academic areas barely if at all covered in high school may stick with us for life, as will insights from literature.  The rules may be different now, but the greatest of what has been said, written, and thought is still worthy of our attention.     

Friday, December 4, 2015

November AJSN Down to 17.2 Million American Jobs Short on Fewer People Marginally Attached

When I read this morning’s Bureau of Labor Statistics Economic News Release, I thought the American Job Shortage Number would stay about the same as last month’s 17.485 million.  This measure, showing the strength of latent employment demand, depends on official joblessness, which stayed the same, more than any other factor.  Seasonally, there is little difference between October and November, so the only thing that would allow the AJSN to drop significantly would be lower counts of people in the fringe categories.  And that is exactly what happened.

The jobs report looked at first glance like treading water.  Adjusted and unadjusted unemployment both stayed at October’s 5.0% and 4.8% (the gap is because autumn is an above average time for work opportunities), long-term unemployment or the number of people looking for jobs but not finding them for 27 weeks or longer held at 2.1 million, wage growth was a lukewarm 4 cents per hour, and the employment-population ratio stayed the same at 59.3%.  The good news, 211,000 net new jobs once again exceeding population increase and the labor force participation rate up 0.1% to 62.5%, was offset by a 319,000 rise in those working part-time for economic reasons, or unsuccessfully seeking full-time positions, to 6.1 million. 

The sets of those marginally attached, though, showed broad-based improvement.  Those wanting work but not looking for it in the previous year fell 190,000, cutting that group’s latent demand for jobs 152,000.  There were 71,000 fewer discouraged but not technically unemployed workers, who would take readily available jobs at the same rate as those in the 5.0%.  The count of those in school or training was down 16%, and those in the “Other” category, wanting work but being temporarily unavailable for it for less likely reasons, fell 13%.  The only significant gainer was, as it usually is, the “do not want a job” group, up over 500,000 and, even estimating only 5% would accept employment, adding 27,800 to the metric.  Overall, the AJSN fell 255,000 to over 7.2 million, as follows:

Compared with November 2014 the AJSN is down 1.35 million, with two-thirds of that from lower official joblessness and most of the rest from fewer people reporting they wanted work but did not search for it in the past year. 

So where are we now?  With the numbers of those marginally attached showing real improvement, this jobs report is underrated.  The 211,000 net new positions was not tremendous, but with a permanent crisis in place we can’t take its roughly 80,000 more than net newcomers could absorb for granted.  Overall, the month was better than many in the past year when official unemployment fell.  The turtle, indeed, took another step in the right direction.