May 13

Regression of Income Growth, Cloaked As Job Growth

People Grow Poorer As Government Pays Its DebtIn its most simplistic form, unemployment figures are based on the number of people currently enrolled in unemployment and new enrollees. The government and their parrots, the media, tell us that unemployment is declining; people are finding jobs and jobs are being created. End of story, right? Not quite.

Let’s look at it from ground level…in the trenches. If you lose your job, as so many did during the “Great Recession”, you were lucky if you were able to replace it. However, for those who could not, to survive they had to look at their options:

  • File for unemployment, but that isn’t enough to remain in the middle-class income range
  • Take up thievery, however, most middle-class wage earners would not consider this option
  • Cash in your retirement, which many did as they waited and waited for the economy to turn around
  • Start your own business, as many did

If you start your own business and business goes down to the point that you cannot support your household, what options are there?  You cannot go on the unemployment rosters because you are self-employed. So, these people are not counted.

As people were rotated off the unemployment rosters because they overstayed their welcome, these people were not counted.

If you were one of the groups who cashed in your retirement to save your house, lost your house because the recovery never came, then you are not counted either.

The unemployment currently stands at 6.7 percent and jobs are being added. It looks great if you do not factor in those who are not counted. I submit evidence that All Is Not Well, as they would have you believe.

Our local chamber of commerce advertised on Craig’s list for an executive assistant, they received well over 100 responses in less than one week. My traditional background is public relations, marketing, and editorial. For those in the trenches seeking lost jobs that pay middle income wages, the situation of applying for jobs is exacerbated by the fact that the human factor has been removed from Human Resources—applicants are left trying to guess what key words should be prevalent in their resumes and cover letters so that the computer will place them at the top of the pile.

While looking at the jobs posted on LinkedIn last week, there were over 300 applicants for one job. How can this be if unemployment is down and new jobs are being created? People working in McDonald’s are screaming for an increase in the minimum wage. Why? Jobs at fast food restaurants and retail stores were traditionally held by the young—high school and college students. They do not need to support themselves yet. However, if those holding part-time jobs of these types are trying to support households and now meet the legal requirements of having health insurance it becomes a problem. If you are a single parent and pay $1,000 – $2,000 per month for rent, then an additional est. $500 per month for gas, food, and utilities, you would need to work full time and earn over $9 per hour just to make ends meet. Of course there is a problem with this scenario. For those who are employed in the retail and restaurant industries, you will be limited to part time hours, no full time. So, just get a second job, right? No. It is more complicated than that because every week work schedules change in these types of jobs. So, factor in taxes and health insurance costs, you need the $15 per hour to survive. If you are a husband and wife working two jobs at $15 per hour, then together you earn $30 per hour—a respectable wage to relieve pressure. Fifteen dollars per hour wages will not happen.

In a May 16, 2011 post on MSN Money, “McDonald’s to replace cashiers with touch screens”, this is a fruitless effort on the part of narcissistic politicians and ignorant unions and employees. As the Internet kills jobs for printers, publishers, editors, publicists, etc., technology will replace even the lowest-paying jobs.

The irony is that big businesses in search of increasing profits and stock value are killing their revenue generation—you and me. The rich and the poor. All of us. If we cannot earn a decent wage and our jobs are replaced by technology, then we have no income with which to purchase their products. Eventually, the rich will run out of money if people stop buying. Their business will die. All you have to do is look at the retail-store graveyard of closings…and, it is still growing:

  • Borders (gone)
  • Hallmark (gone)
  • Blockbuster
  • Barnes & Noble
  • Dress Barn/Lane Bryant and others owned by Ascena Group
  • Best Buy
  • Abercrombie & Fitch
  • Aeropostale
  • Build-A-Bear
  • American Outfitter
  • Coldwater Creek
  • Fresh & Easy
  • The Gap
  • GameStop
  • Staples
  • Thomasville Furniture
  • Radio Shack
  • Sears

Well, you get the picture. If the economy is improving, then why are there still store closings? Automation of jobs traditionally held by humans extends beyond industries destroyed by the Internet. We see education moving online, doctors from anywhere diagnosing and treating patients with roving computers, robots in the operating room…where will it end? And the media is doing a great disservice to people by merely regurgitating talking points distributed by politicians who only have themselves at heart. Gone are the days of Woodward and Bernstein. In fact, I would venture to guess that if you took a poll of people between the ages of 18 and 30 (prime voting age), they would not know anything about Watergate.

However, employment, like everything else in an economy, is driven by supply and demand. As long as there is an oversupply of people who want to work, employers will dictate the rules. So, applicants will spend hours fine-tuning their resumes and cover letters to try to outthink a computer, and employers, like Hobby Lobby, will place signs on their front doors advertising that they are hiring, when in fact, they are just building a pool of applicants from which to choose when something comes available. How do I know this? Because I decided to see if indeed they were hiring by filling out an application and submitting it—it took an hour out of my day. Hobby Lobby was in the news recently as exerting their conviction about providing health insurance for their employees when it was against their morals. I submit to you…when people are desperate for a job, is it moral to give them hope and waste their time when in truth, you are not hiring?

And, don’t get me started on people so desperate for work they try to find it on sites like Elance, Fvr, and ODesk. Who can survive on $.01 per word for writing an article? Who can pay the rent on that?

Related Stories across the Web:

Economy Not Keeping Up with Population Growth (The Washington Free Beacon)

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