From The Dallas Morning News
Deener: Poorly educated, don’t-give-a-damn workers are dragging down the economy
Conventional wisdom has it that one of the main reasons for the lethargic U.S. economy is that middle- and low-income workers are getting the short end of the wage stick.
It is true that hourly wages have been stuck in a rut since this bull market and economic recovery began more than six years ago. And all the while the corporate fat cats have grown ever richer — income inequality, if you will.
This apparently has negatively impacted consumer spending — a major component of economic growth. In other words, the economy suffers from a lack of consumer demand.
I don’t disagree with that, nor do I doubt that higher wages would goose the comatose economy. But I have a couple of other thoughts on this topic that I would submit are plausible reasons for why we find ourselves in continuing economic stagnation.
My first insight — one that I have experienced first-hand, and I’m sure readers of this screed have, too — involves the erosion of our workforce.
OK, using the term erosion is much too polite, so I’m just going to come right out and say it: There are just a lot of unmotivated, poorly educated, don’t-give-a-damn workers out there who couldn’t care less about increasing productivity or being nice to customers.
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This is only anecdotal but just the other day I was trying to buy some personal products from a major retailer, and the clerk couldn’t figure out how to open the secured container to give me my razor blades. Nor could she figure out how to scan the price of another item, so I just told her keep it. And she wasn’t polite, either.
My point is that we might have slack demand, but I submit the United States also has a slack supply of capable workers. Allow me to marinate that statement in some facts. A record number of people, some 90 million, have left the workforce in recent years and stopped looking for jobs — and no, that is not a typo.
Think of that. Some 90 million people who could work choose not to work, and that number is up from just over 78 million in 2008.
“The share of the population that is out of work and not looking for work is quickly heading to an unprecedented 38 percent,” wrote David Rosenberg, chief economist for Gluskin Sheff, in a recent report. “The number of Americans [90 million] now outside the labor force exceeds the entire German population.”
Let’s examine this so-called labor participation rate — a measure of all those who have jobs and those who are still searching for jobs. It reveals the very un-American trend that millions of Americans have stopped even trying to find work.
The labor participation rate has been steadily declining for a decade from about 66 percent to 62.7 percent today. This decline reflects workers who are either too discouraged to look for a job, don’t care or choose to live off government largesse.
As for this latter point, the number of welfare recipients, food stamp participants and people collecting disability benefits has exploded over the past decade and now stands at record levels. For example, a decade ago there were about 20 million Americans on food stamps, but that number now stands at 40 million and growing.
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I won’t veer off into the realm of politics, and certainly people going hungry in America is absolutely abhorrent. But Rosenberg makes the point that people today have access to literally hundreds of government programs that in many cases compensate them better than holding a job.
“Unemployed people that can tap the myriad of government benefits make more in a year than a full-time administrative assistant,” he wrote.
About 9 million people collect disability payments today, compared with about 3 million in the 1990s. Again, I don’t begrudge government help for the disabled, but I question the legitimacy of such an explosion in the number of disabled people.
Be that as it may, perhaps an even more powerful force at play in the labor force is demographics.
The majority of those dropping out of the workforce are in their 60s, which is too bad because my guess is that many of these folks are experienced, hard-working people. They could at least efficiently check out customers without creating a line backup from here to Waxahachie.
This demographical shift is certainly one of the factors working against the supply of labor, but there is this, too: The U.S. birth rate is falling at just the time we are going to need more workers.
The number of births per 1,000 people has fallen from about 16 in 1990 to just over 12 today. The number of births per woman has dropped since 2007 from 2.1 to 1.86 today.
Study finds older workers often missing from rising job rate
Immigration may fill the gap, but Rosenberg points out that the number of people obtaining permanent resident status has dropped in three of the last four years.
Rosenberg stresses that we need a growing, vibrant workforce to have a growing, vibrant economy and stock market.
“Population growth is a key to economic growth,” he said. “This [falling birth rate] is clearly having an impact on that one critical input into the economy, otherwise known as people.”
Indeed. Now, will someone please check me out — and do it with a smile?
Deener: Poorly educated, don’t-give-a-damn workers are dragging down the economy
Conventional wisdom has it that one of the main reasons for the lethargic U.S. economy is that middle- and low-income workers are getting the short end of the wage stick.
It is true that hourly wages have been stuck in a rut since this bull market and economic recovery began more than six years ago. And all the while the corporate fat cats have grown ever richer — income inequality, if you will.
This apparently has negatively impacted consumer spending — a major component of economic growth. In other words, the economy suffers from a lack of consumer demand.
I don’t disagree with that, nor do I doubt that higher wages would goose the comatose economy. But I have a couple of other thoughts on this topic that I would submit are plausible reasons for why we find ourselves in continuing economic stagnation.
My first insight — one that I have experienced first-hand, and I’m sure readers of this screed have, too — involves the erosion of our workforce.
OK, using the term erosion is much too polite, so I’m just going to come right out and say it: There are just a lot of unmotivated, poorly educated, don’t-give-a-damn workers out there who couldn’t care less about increasing productivity or being nice to customers.
5 reasons the U.S. economy isn’t catching fire
This is only anecdotal but just the other day I was trying to buy some personal products from a major retailer, and the clerk couldn’t figure out how to open the secured container to give me my razor blades. Nor could she figure out how to scan the price of another item, so I just told her keep it. And she wasn’t polite, either.
My point is that we might have slack demand, but I submit the United States also has a slack supply of capable workers. Allow me to marinate that statement in some facts. A record number of people, some 90 million, have left the workforce in recent years and stopped looking for jobs — and no, that is not a typo.
Think of that. Some 90 million people who could work choose not to work, and that number is up from just over 78 million in 2008.
“The share of the population that is out of work and not looking for work is quickly heading to an unprecedented 38 percent,” wrote David Rosenberg, chief economist for Gluskin Sheff, in a recent report. “The number of Americans [90 million] now outside the labor force exceeds the entire German population.”
Let’s examine this so-called labor participation rate — a measure of all those who have jobs and those who are still searching for jobs. It reveals the very un-American trend that millions of Americans have stopped even trying to find work.
The labor participation rate has been steadily declining for a decade from about 66 percent to 62.7 percent today. This decline reflects workers who are either too discouraged to look for a job, don’t care or choose to live off government largesse.
As for this latter point, the number of welfare recipients, food stamp participants and people collecting disability benefits has exploded over the past decade and now stands at record levels. For example, a decade ago there were about 20 million Americans on food stamps, but that number now stands at 40 million and growing.
U.S. hiring lost sizzle in March, with 126,000 jobs added
I won’t veer off into the realm of politics, and certainly people going hungry in America is absolutely abhorrent. But Rosenberg makes the point that people today have access to literally hundreds of government programs that in many cases compensate them better than holding a job.
“Unemployed people that can tap the myriad of government benefits make more in a year than a full-time administrative assistant,” he wrote.
About 9 million people collect disability payments today, compared with about 3 million in the 1990s. Again, I don’t begrudge government help for the disabled, but I question the legitimacy of such an explosion in the number of disabled people.
Be that as it may, perhaps an even more powerful force at play in the labor force is demographics.
The majority of those dropping out of the workforce are in their 60s, which is too bad because my guess is that many of these folks are experienced, hard-working people. They could at least efficiently check out customers without creating a line backup from here to Waxahachie.
This demographical shift is certainly one of the factors working against the supply of labor, but there is this, too: The U.S. birth rate is falling at just the time we are going to need more workers.
The number of births per 1,000 people has fallen from about 16 in 1990 to just over 12 today. The number of births per woman has dropped since 2007 from 2.1 to 1.86 today.
Study finds older workers often missing from rising job rate
Immigration may fill the gap, but Rosenberg points out that the number of people obtaining permanent resident status has dropped in three of the last four years.
Rosenberg stresses that we need a growing, vibrant workforce to have a growing, vibrant economy and stock market.
“Population growth is a key to economic growth,” he said. “This [falling birth rate] is clearly having an impact on that one critical input into the economy, otherwise known as people.”
Indeed. Now, will someone please check me out — and do it with a smile?
