Tag Archives: Unemployment

“There Are Absolutely No Job Seekers”: How Trillions In Stimulus Sparked A Historic Job Market Crisis, by Tyler Durden

Has the response to Covid-19 created a class of permanent, unemployable, couch potatoes? From Tyler Durden at zerohedge.com:

Something odd is going on in the US economy.

On one hand, in the aftermath of the covid pandemic there are millions and millions of former workers who have lost their jobs and are unable to return as their job may not even exist today (while their skills atrophy and they become increasingly unemployable with every day they are unemployed). Addressing this, on Thursday Fed Chair Powell spoke at an IMF panel saying that over nine million Americans remains out of work, while a quick look at the latest BLS data shows that there are over 100 million Americans who are out of the labor force (of whom just 6.85MM want a job currently, and a record 94 million don’t want a job).

At the same time, as we pointed out last night, JPMorgan and many others have noted that when one looks at the recent JOLTS data, which showed a near record number of job openings, a clear trend is emerging: there is a big labor shortage in the US, one which could (finally) lead to higher wages in the US.

While JPMorgan did not dwell on what may be causing this unprecedented schism within the economy – after all, for normalcy to return, people must not only be employed but must want to be employed – it did suggest that the “robust” government stimulus may be keeping workers on the sidelines, a more detailed analysis from Bloomberg confirms the nightmare scenario: the trillions in Biden stimulus are now incentivizing potential workers not to seek gainful employment, but to sit back and collect the next stimmy check for doing absolutely nothing in what is becoming the world’s greatest “under the radar” experiment in Universal Basic Income.

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More California cities experiment with “hero pay” leading to predictable results, by Jazz Shaw

A business can’t afford to pay its workers more than they are worth to the business. From Jazz Shaw at hotair.com:

Back in early February, we looked at a story out of Long Beach, California where the City Council passed an ordinance requiring large, chain grocery stores to provide workers with an extra four dollars per hour as “hero pay” during the pandemic. That immediately resulted in two of the biggest Kroger stores in the area closing their doors permanently, putting hundreds of people out of work. At the time, I noted that a number of other large municipalities in the Golden State were either already drafting or considering similar legislation. But having seen what happened in Long Beach, they thankfully had sufficient warning not to make the same mistake.

Or so you would have thought. But as it turns out, you’d have been wrong. Los Angeles plunged ahead and passed the same type of law, only they upped the ante and made it five dollars per hour. Try not to faint from shock when I tell you that three more Kroger stores shut down in short order. If only someone could have somehow foreseen this and avoided all of these closures. (Washington Examiner)

Why Not Make the Minimum Wage $150 Per Hour? by PF Whalen

A real humanitarian would say why not $10,000 an hour, but we’ll start with PF Whalen’s modest proposal. From PF Whalen at bluestateconservative.com:

The periodic debate regarding raising the minimum wage has resurfaced once again, only this time the argument is connected to the larger discussion surrounding a sprawling, $1.9 trillion COVID relief bill; for some inexplicable reason. In the bill unveiled by House Democrats last Friday, if passed, the minimum wage would increase incrementally from the current $7.25 per hour to $9.50 per hour this year, and eventually escalate to $15 per hour by 2025. Prominent Democrats across the board have supported the idea, including President Joe Biden.

If we deep-dive the issue in trying to understand its full impact, we can learn a great deal about the pros and cons of increasing the minimum wage; particularly with the cons. But there are two pieces of information that are difficult to come by. How, specifically, did we arrive at the number of $15? And, based on the Democrats’ reluctance to acknowledge the negative impacts of a minimum wage increase, why don’t we just add a zero to the number and increase the minimum wage to $150 per hour?

Sen. Bernie Sanders (I-VT) was the first influential public figure to float the idea of a $15 minimum wage, having proposed the idea all the way back in 2015. Sanders’ plan pointed out his perceived benefits for those who are being paid the minimum wage. Beneficiaries would see an improved standard of living; the burden on taxpayers from food stamps and Medicaid would be reduced; and an increase in available income would spur economic growth. It sounds like a wonderful plan.

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“People Are Fed Up”: California Out Of Excuses As Coronavirus Defies Militant Lockdowns, by Tyler Durden

People might not be quite as angry if all the lockdowns and masking had done any good, but they haven’t. The hypocrisy hasn’t helped, either. From Tyler Durden at zerohedge.com:

California’s response to COVID-19 ranks slightly below China welding people inside apartment buildings in terms of militancy, yet the for all the measures taken by the Golden State, it’s become one of the nation’s worst epicenters for the pandemic, according to Politico.

Registered Nurse Allison Shiftar puts on protective glasses as she gets ready to go into one of the triage rooms to care for a Covid-19 positive patient in the emergency department at Sutter Roseville Medical Center in Roseville, Calif. | Renee C. Byer/The Sacramento Bee via AP, Pool)

And if Politico is calling out California, whose Democratic governor deems himself above his own rules, you know it’s bad.

America’s most populous state has become one of the nation’s worst epicenters for the disease, setting new records for cases, hospitalizations and deaths almost every day. Things are so bad in Southern California that some patients are being treated in hospital tents, while doctors have begun discussing whether they need to ration care.

The turnabout has confounded leaders and health experts. They can point to any number of reasons that contributed to California’s surge over the past several weeks. But it is hard to pinpoint one single factor — and equally hard to find a silver bullet. –Politico

The state of nearly 40 million residents has seen almost 2 million cases and 22,000 deaths despite strict mask mandates, school and playground closures, and restrictions on dining that are destroying small businesses across the state.

“Nationally, there has been a kaleidoscopic application of every imaginable type of lockdown order with California being the most restrictive and inflicting the most devastation on small businesses and the most economically vulnerable service workers. And still, we are none the better as far as COVID is concerned,” said California Restaurant Association President and CEO Jot Condie, adding “In fact in L.A. where indoor and outdoor dining are completely shut down, with indoor dining [closed] since July, the virus rages on.”

Meanwhile, the state – like many others, is suffering from spikes in crime, mental illness and suicide.

At more than 100 new daily cases per 100,000 residents, California’s case rate is second only to that in Tennessee, according to the nonprofit tracking site Covid Act Now — though it’s a state that does not mandate mask wearing and allows indoor gatherings of up to 10 people. The website Covid Exit Strategy shows a 97 percent rise in Covid throughout California, which has gone in the opposite direction from its West Coast counterparts, Oregon and Washington. -Politico

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Government, Not Coronavirus, Is Killing Small Businesses, by Ron Paul

Increasingly, small business is starting to fight back, a fight in which they should be supported. From Ron Paul at ronpaulinstitute.org:

A video of a confrontation between Ventura County, California health officials and restaurant owner Anton Van Happen has gone viral. The health officials were ordering Mr. Van Happen to close his business because he allegedly violated California’s ban on outdoor dining. Mr. Van Happen asked the health officials if the government will pay his employees and his rent while his business is indefinitely closed.

Mr. Van Happen is hardly the only small business owner worried about how to pay bills during the lockdowns. Many small businesses operate on a narrow profit margin, so being forced to “temporarily” shut down or limit the number of customers they can serve is a virtual death sentence.

The lockdowns have already caused as many as 200,000 small businesses to permanently close. Lockdowns, by shrinking the number of employers, lead to long-term unemployment or lower wages for many workers.

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What About The Economy? by the Zman

The legacy media won’t be able to ignore the economy for much longer. From the Zman at theburningplatform.com:

Depending upon your age, two standard items in the news for most of your life, if not all of it, have been economic data and the stock market. The economic stagnation starting in the late 1960’s lasting into the 1980’s made the economy the top priority on everyone’s mind. Every election, it was one of the top issues. In the 80’s, Baby Boomers got into the financial markets, so the stock market and your 401K became a strange proxy for general happiness.

Something that has gone unremarked during the Trump era has been the fact that these paramount issues have dropped in priority with the media. On the Left the only thing that has mattered is hating Donald Trump and white people. On the Right, the only thing that matters is the various internal battles over what it means to be on the Right and where Trump fits into it. No one has noticed that the stock market has just about doubled in value during his presidency, despite it all.

Many on this side of the great divide mock public concern for the economy, but that is often just a pose. A primary goal of any human society is the prosperity of the people, as that is the point of human organization. Humans came together in larger and larger groups, in part, because it increased material prosperity. Even the communists were primarily focused on material prosperity. Read the book Red Plenty and you will see that no one is more materialist than a communist.

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Where Is The Compassion… by Bill Rice, Jr.

It’s long past time to quit giving people who claim they’re compassionate a free pass (“but his intentions were good”) when the results of their programs turn out to be anything but compassionate. From Bill Rice, Jr. at zerohedge.com:

Where is compassion for the millions who’ve suffered harm from lockdowns?

Like myself, I’m sure many Americans are starting to grow tired of being labeled “insensitive” or “uncaring” or lacking compassion because we are perceived as not caring about “at-risk” people who might contract the coronavirus.

Let’s talk about “compassion for our fellow man.”

…Where’s the compassion for the single mom who is increasingly struggling to purchase diapers or baby formula for her children? Where’s the compassion for the victims of child abuse, which is no doubt spiking due to the collapse of the economy?

…Where’s the compassion for those who have already committed suicide, or attempted suicide or will do either in coming months and years?

…Where’s the compassion for the tens of thousands of business owners who have permanently closed their businesses, or for the tens of millions of unemployed former employees? Where’s the compassion for those who have been forced to declare bankruptcy, or are agonizing over doing this?

…Where’s the compassion for the millions of college students who are experiencing increased levels of anxiety and depression over draconian campus policies that keep them isolated and prevents them from receiving a real education?

…Where’s the compassion for the younger school children who are unnecessarily living in fear? Where’s the compassion for the same children who can’t even play or socialize with other children anymore?

…Where’s the compassion for the hundreds of millions of people in impoverished nations who will suffer famine, misery or death because food logistic systems are falling apart?

…Where’s the compassion for those who spent weeks or months in a hospital – for every health reason – and could not spend a minute with their loved ones, many dying alone by themselves?

…Where’s the compassion for family members who received no comfort from neighbors and friends after their loved one died because these people were not allowed to attend their funeral?

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The High Price of COVID-19 Lockdowns, by Bill Bonner

We may be repeating ourselves here, but the cure for Covid-19 has been far, far worse than the disease. From Bill Bonner at rogueeconomics.com:

SAN MARTIN, ARGENTINA – We begin today with a new study by the RAND Corporation.

It tallies a little more of the hidden cost of House Arrest.

ABC News reports:

Now, new data shows that during the COVID-19 crisis, American adults have sharply increased their consumption of alcohol, drinking on more days per month, and to greater excess. Heavy drinking among women especially has soared. […]

“The magnitude of these increases is striking,” Michael Pollard, lead author of the study and a sociologist at RAND, told ABC. “People’s depression increases, anxiety increases, [and] alcohol use is often a way to cope with these feelings. But depression and anxiety are also the outcome of drinking; it’s this feedback loop where it just exacerbates the problem that it’s trying to address.”

The bills will continue to trickle in for years. Jobs lost. Companies bankrupted. Careers and families stifled and stunted.

Job Cuts

Yesterday came more news of job cuts. Here’s Bloomberg:

American Airlines Group Inc. and United Airlines Holdings Inc. will start laying off thousands of employees as scheduled, spurning Treasury Secretary Steven Mnuchin’s appeal for a delay as he negotiates with Congress over an economic relief plan that includes payroll support for U.S. carriers.

American is furloughing 19,000, while United is laying off about 13,000.

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The 21st Century Is Marked By Crisis and Political Division, by Bill Bonner

We’re twenty percent into the 21st century and it hasn’t been a great start. From Bill Bonner at rogueeconomics.com:

Week 26 of the Quarantine

In this bright future, you can’t forget your past.

– Bob Marley

SAN MARTIN, ARGENTINA – What a colossal flop!

We’re talking about the 21st century. A failure in almost every way.

We now have 30 million people on unemployment – nearly 20% of the labor force.

We have a budget deficit of nearly 20% of GDP.

And, despite already spending $2 for every $1 they collect in taxes, the feds are planning to spend more.

We have phony “conservatives” waving the flag… and real radicals trying to tear it down. On both sides are more and more loonies, locked and loaded…

Even many of our own dear readers are ready to go to war with each other. This is from yesterday’s mailbag:

Hey Dude, we are at WAR! Trump leads the Win-the-War Party! The Neo Repubs are the “What? Me, worry?” Party. And you are like the pet dog nipping at the heels of the soldiers marching past!

No matter the cost, we must win the war against socialism and the Ds. There is time enough to purify ourselves after we win! If we lose, it will be a “thousand years” before our experiment is tried again… Meanwhile it is your obligation to support those who are fighting, regardless of technique and strategy… TRUMP!

Nasty Themes

It is hard to figure out how an administration that declares a moratorium on rent collection, stifles free trade, and runs a deficit of 20% of GDP could save us from socialism… But in this great 21st-century future, wonders never cease.

This week, in this “new normal,” we’ve been trying to remember what the “old normal” was like. And was it really better? Or is it just us?

We recalled what it must have been like when we were born. Of course, it was a very different world back then.

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COVID Financial Pain ‘Much, Much Worse’ Than Expected, Warns Harvard Study, by Tyler Durden

Some of us expected Covid’s financial pain to be very bad indeed, but that certainly wasn’t the mainstream media line. From Tyler Durden at zerohedge.com:

New findings from a survey by the Robert Wood Johnson Foundation and the Harvard T.H. Chan School of Public Health, published by NPR News on Wednesday, reveal low-income minority households have experienced the most financial hardships in the virus-induced recession.

The pandemic heavily impacted Black and Latino households across America’s four largest cities (New York, Los Angeles, Chicago, and Houston) with massive job loss or reduction in hourly wages or a decline in working hours.

The survey, conducted from July 1 through Aug. 3, found Latino households (77%) and Black households (81%) in the Greater Houston area incurred “serious” financial problems.

Houston

As for the three other major cities, the survey showed 73% of Latinos in New York City experienced severe financial hardships, 71% of Latinos in Los Angeles, and 63% in Chicago. Black households in New York City (62%), Los Angeles (52%), and Chicago (69%) also reported severe financial distress because of the downturn.

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