A couple of days ago the Economic Policy Institute posted this chart:
The point here is that there is no "Great Resignation," with its implication that people are tired of working and leaving their jobs in droves. Rather, there's a "Great Hiring." People aren't quitting their jobs to get more hammock time, they're quitting their jobs because they're getting better offers elsewhere.
Thanks to assistance packages passed on a bipartisan basis first, and then solely by Democrats later, the US economy is better now than it was two years ago. That's pretty remarkable, and if the price we pay is a bit of extra inflation for a while then that's not really much of a price. How many other large countries can say they've done better?
That is impressive. It looks like hiring rates are above quitting rates for all the sectors in question. Are we seeing a rise in the LFPR as well?
Yes. Follow Gilgit’s link below.
" and if the price we pay is a bit of extra inflation for a while then that's not really much of a price. "
Not to mention it's still unclear if the assistance packages are the main driver of inflation or if supply chain disruptions or other factors like changes in the oil/gas/energy markets are more important. I still thing it's mostly the later.
They're kind of interrelated. Flush with cash from not having taken vacations, eaten meals out, and other savings during lockdowns, as well as the stimulus payments, Americans went on a spending spree in 2021, much of it online. The global supply chain networks couldn't handle it after retrenching so much during the height of the pandemic and so we got this temporary inflation problem. That's working itself out now, but suppliers are no doubt keen to find out how much they can keep prices higher anyway without losing customers, so some markups may be here to stay.
Of course. I wouldn't argue that the stimulus had no effect, but I think the root cause was mostly supply side, not demand side. But yes, adding to income and consumer demand when there is a supply side disruption will contribute to inflationary effects.
We're still a couple of million jobs underwater compared to before the pandemic, though. A good chunk of that may be represented by early retirements, but has productivity really jumped so much that we're near full employment, but with millions fewer jobs filled? I'm not sure how to square that circle.
Yes, I am so happy the economy is doing so well. As someone who has tried to work though the last 3 recessions, this is ideal. I got lucky during the worst of the downturns and worked through most of the Great Recession. But 2001 was devastating. It wasn’t that I had to take a job with less pay or a longer commute, there were no new middle class jobs to be had. When my unemployment ran out I had to get a job at Toys “R” Us. 1991 was also a nightmare.
The idea that any of the unemployed during these times would have turned down 3.9% unemployment because gas prices would rise to a level equal to a few years earlier is crazy. It is like the people claiming things are bad are acting like 12 year olds and have never lived through a downturn before.
Other places have the same charts, but when I want to look at Employment-population ratios I always go to https://www.calculatedriskblog.com/. I know Kevin made a post showing the numbers have been going down over time, but looking over a longer term things look fine. Looking at 25-54 year olds, calculated risk’s chart look like this:
https://blogger.googleusercontent.com/img/a/AVvXsEi_mz6VGvVIzhwumHdWX-1Hb1OpyTLFBs8Q7UD6FpmGuSRKnIKbJau70yU0OezhdqDMzor-UpPjMSrBskoIZR1UPYPTqX_BjoNzwFR8BF0gUAwvclq0R9Yns9WGFWay4dELVejsCvBnpBzICA1AQQEPJi90BHP7e0KHmLM_x9pv5g5D4ksitg=s1064
We are where we were at the beginning of 2018. Nobody in 2018 thought things looked bad. I’d also add that the only time the Employment-Population ratio got much above 80% was in the late 90s. It reached 80% three other times: 1990, 2007, 2020. And then a recession happened. I assume we will again reach 80% in the next year or so. That will be 2 years into Biden’s term. It took 13 years after 2007 to get back to that level. Again, trading inflation for a year to get these numbers is an incredibly positive tradeoff. (And a lot of the inflation was unavoidable in any case.)
Thanks for the link. I know that EPOP = LFPR + Unemployment rate, but seeing the first two plotted together is still informative. Clearly people currently re-entering the workforce are not only finding jobs, they are finding them quickly.
The economy is still short of where it was in early 2020 by at least four million jobs:
https://fred.stlouisfed.org/graph/?g=KJSc
By the second quarter of 2021 GDP was above where it was in 2020, but not back to the previous trend:
https://fred.stlouisfed.org/graph/?g=KJSU
So no, the economy is not really better than it was in early 2020, but still doing very well considering what we've gone through. The comparison should not be with other countries, most of which also had large spending programs, but with what supposed Republican ideology would have done, that is no government spending, leaving people to get by on their own.
Because so many employers have had to rehire after the economy opened up, there are lots of openings and chances for those who want to come back to change jobs. But people are still holding back from getting jobs, presumably because of remaining stimulus money and fear of covid and bad working conditions caused by covid.
Working people haven't had the immediate "Biden boom" that some people predicted, but the conditions are such that it may come along in a year or two if the pandemic ever ends.
Who knows if it really lacks 4 million jobs, or if bean counters are struggling.
Kevin, you do great work. Can you get any of this in front of cable news producers & anchors? They seem not to know any of this.
The media is relentlessly trying to drive down Biden's numbers by Doom and Glooming everything.
I agree completely with the point being made here, but I disagree with the following framing of the "Great Resignation":
"The point here is that there is no "Great Resignation," with its implication that people are tired of working and leaving their jobs in droves."
The coverage I've seen of the Great Resignation hasn't made this implication, and I don't think you need to make this implication for it to be a new and important development. The quits rate has not been higher than 2.4% for any month between December 2000 (when the series began) and February 2021 - but it has been higher than that every single month since March 2021, with September and November both clocking in at 3%. Wow! Something is noticeably different than it used to be!
https://fred.stlouisfed.org/series/JTSQUR
I think this is worthy of a Capitalized Term without necessarily implying that Everyone Is Done With Work. There really are a lot more people resigning than there used to be! And it turns out, almost all of them are leaving to get better jobs - great! - but that doesn't mean the quits themselves aren't news.
Yeah, this. The whole Great Resignation thing is that people (and largely white collar, really) aren't just leaving the workforce entirely, but that they're getting better jobs because they're sick of their old boss's/job's stupid bullshit. Be that bullshit pay or bullshit "reasons" trying to force them to return to the office more often than necessary when the office is superfluous.
Although just the other day Kevin posted a chart about retirements being up, didn't he? But that can't be the whole story of the 3% quits.
Lets note, a bunch of quits are make-up. I suspect like inflation, this number drops noticeably by the end of 2022.
I just do not get the point kevin is trying to make .
Outside of recessions, we EXPECT there to be an increase in total jobs at least proportional to population growth , or more as you still need to offset the loss of jobs in recessions.
So having more hires than total terminations of employment would be simply " normal " , not an indication of an economy doing " good " or "great ", unless the difference was larger than an even average non recession year . And kevin shows no such comparison to another year.
And , if that chart really does just compare " hires" and " quits " , not counting any other terminations of employment like being fired, then the comparison is really silly and meaningless. Of course hires are greater than quits . It would be an extraordinary situation where quits are actually larger than hires.
Even in a recession when total employment is falling and thus total terminations are higher than total hires, the % of terminations that are quits will fall dramatically, because people do not want to quit when prospects of getting hired somewhere else are bad.
A pandemic where govt is almost encouraging unemployment by heavily subsidizing unemployment insurance, and some workers are scared of working, and the remaining jobs are hard to fill, is exactly that type of situation. Anyone willing to still work instead of collecting unemployment is in high demand, so you have falling employment but with high demand for ees, making it easy to quit and find a new job.
Now, if kevin is just trying to say that having a higher quit rate itself is not necessarily a bad thing, and some of the panic over it is misplaced, OK I agree . A higher " churn rate " where ees feel free to switch jobs for anyone offering higher wages, is the way a free market is supposed to work well in setting market wages. And can be a good sign of employers and employees resorting employees into positions where they have highest value , rather than getting stuck by inertia in a job where they are not as productive as they could be.
Sometimes, disruptive economic occurrences like recessions or pandemics are needed long term to clear out the deadwood and let the free market resort people and resources to where they are most productive. A high quit rate and hire rate can be a good thing.
Maybe, pre pandemic, ee A was working in a restaurant and was not that productive or happy. And might be better and happier working retail. But hard to just change jobs when you have a decent job. And maybe ee B is just the opposite and would be better in restaurant instead of retail. If the pandemic disruption ends up getting ees A and B to switch jobs, good.
But Kevin's chart is worthless, especially if " quit" in it really is just quits and does not include fires. To compare them, hires should only include those hired after quitting prior job.
And , if democrats try to campaign this year by saying that the economy is good because some results are worth " a bit of inflation ", they will lose in a historic fashion. Inflation is now more than what can be refereed to as " a bit".
And , when real wages are going down , that is not what you would see if a higher " churn rate " in employment was a good thing with people moving to where they are most productive.
Real wages going down may very well be due to a composition effect, i.e. a disproportionate number of new hires into lower-paid occupations, such as (brick-and-mortar) retail, and restaurant work.
This is just for the month of November. The Great Resignation mostly happened in 2020. If lots of people quit jobs last year year and unemployment benefits were extended this year, it makes sense that hires exceeds quits now that the benefits are expiring. That isn’t evidence the Great Resignation didn’t happen.
Job losses in 2020 weren’t quits (which is how resignations are classified), they were layoffs and furloughs.
https://fred.stlouisfed.org/series/JTSQUR
Something re covid I saw on the la county website today . The % of hospitalizations that are " with covid " instead of " due to covid " is 55%. Which is higher than I expected.
Current hospitalizations are around 1100 which would leave the numbers at around 500 actually due to covid and 600 where covid was incidental to the hospitalization.
But the November low for covid hospitalizations was around 620 and I would estimate that covid prevalence then with delta was no more than 20% of what it is now with omicron. So the incidental covid hospitalizations then should have been around 20% of what it is now , as that should be directly proportional to the community prevalence. Or about 120. Which would leave hospitalizations actually " due to " covid at the same number of 500 then as it is now ..
So this huge omicron wave is not causing ANY increase in hospitalizations vs the post delta wave low? And way less than what it was at the delta peak?
So the net increase in contagiousness with omicron is more than offset by the decrease in virulence, even for relative case numbers.
Is this right ? Have I made some conceptual or math error here. I have been waiting for this number for overall " with covid " hospitalizations to try to determine this ( do not know why this was not always part of standard reporting- although maybe I do) but I did not expect such an incredibly optimistic conclusion.
And also this means that the reported differences in hospitalizations for unvaccinated vs vaccinated, including those just " with covid " just cannot mathematically be mostly due to the vaccine actually reducing " due to " covid numbers. Has to mean that the " with covid " numbers are also much much lower too for vaccinated. Unless you actually think somehow we stumbled into a " wonder vaccine " that cures everything even including accidents, that has to be due to a huge correlation in those who chose to be vaccinated with those otherwise healthy ( due presumably to other " responsible correct " health decisions or lifestyle).
But then maybe the vaccine sceptics are right, and their presumed effectiveness is just a mirage caused by their ability to sort into healthy and unhealthy people through the choice to be vaccinated.
Which then means that the choice to be vaccinated was actually the wrong dumb decision based on results , but only because it still was the decision that was made by those who clearly usually make the right decision ( and so probably was right based on facts at the time ) .
Not that I can really believe that the vaccine was totally ineffective. Too much evidence outside of just comparison data showing at least some benefit. But certainly makes me question how much .
And maybe la county numbers are a fluke caused by some weird factor.
Has anyone seen any hard data re number of " with covid " for other places so can try same sort of analysis for them?
And did think of one thing maybe explaining part which could move results into more believable territory .
Could it be that , pre big pandemic in November, many with marginal non covid issues would go to the hospital than today when scared of covid .
So that could actually mean the " with covid only " numbers today are biased low and would otherwise be higher . Which, contrary to what some might think , would change the result to be more pro vaccine as I am using current " with covid" numbers to estimate what they were in Nov. and then subtracting that to get estimated " due to " numbers. So maybe the " due to " covid numbers for November are really lower as the " with covid " is higher?
But hard to see that changing much.
Also heard some reports that current pcr test may have more false negatives with omicron. Which would also mean an increase in current " with covid " numbers .
Just to clarify something.
I would appreciate it if anyone has any real logical response where my conclusions might be wrong, and not just some partisan argument.
Because I am facing a real life decision where covid risk estimates might play a role .
Have not mentioned this before but I have been struggling with some significant medical issues for two years and a recovery from surgery which has not gone well. The result being that it has been very difficult and painful to sit and sometimes to even walk . And I have just barely been able to cope with just necessary shopping, doctor visits and very brief visits to the office. The main reason I have been able to post so much is that I am lying in bed with my phone so much and have nothing else to do!
But for two and a half years, I have been unable to visit my 92 year old mom in a nursing home a continent away . Until a few months ago , a plane trip was just unthinkable for that length. But last few months some improvement and beginning to consider whether soon I might be able to take that plane trip soon, even with difficulty and a lot of pain.
But now my mom seems to have taken a turn for the worst . Not yet the " she is dying " stage but a visit to maybe see her is getting more urgent . But I am still in a condition where travel would be real difficult and risk some chance of me ending up in hospital outside of covid . So traveling today only want to do if really needed .
And covid plays a factor but how much? Without covid , I am just over the line thinking go now and bear the risk . Yesterday, adding covid in I was planning to wait until February and heal some more .
So my assessment of really how much covid risk is there is now for me to make a real life decision.
So sorry to hear about your struggle. Wish I had some input to your difficult decision. I do hope you find a solution, and of course most of all that both you and your mother get better.
Thanks for the thoughts.
Now both my sisters and my brother have omicron. One confirmed, one almost for sure , and the other seems almost must have as her three kids have it and she is unvacinated and refuses to take any precautions. But she has no symptoms
The media represents employers (who buy their ads) and so this will always be cast as "lazy, ungrateful workers are quitting, and putting upward pressure on wages, which cuts into my profits" hence, "the Great Resignation".
Nevermind that the truth, at least from the workers' perspective, is "I don't have to put up with this if I can find a better gig with more pay / less abuse" - "the Great Job Upgrade"