I can’t bring myself to turn on CNBC or Fox Business and listen to apologists try to sugar coat the dismal jobs recovery in the USA (Mark Zandi, can you hear me now?)
First, the good news. Initial jobless claims rose to 283,000. But that remains far below the peak in March 2009 of 665,000.
Now for the bad news. Despite the improvement in initial jobless claims, real median household income and average wage growth remain lower than in 2007.
And to top if off, The Federal Reserve through it’s policies have driven short-term rates to near zero, punishing savers. This of course is an attempt to encourage Americans to take on more risk and invest in risky assets.
Now, while America’s middle class is lagging in terms of wage and income growth, The Federal Reserve is pumping air into real estate prices and the stock market.
So now you can understand Fed Chair Janet Yellen’s plea for folks to “get on the asset train!”
That is, until it crashes and burns.
But not to worry. As long as Chinese investors pump up Irvine and Arcadia home prices in the Los Angeles area and continue to purchase New York commercial property, what can go wrong?
This is an economic recovery?
Texas employment since December 2007, up 1.32 million jobs. All other states lost 1 million jobs.
This disparity between Texas and the other 49 states make the following chart even more ominous … for the other 49 states.
To quote Ray Wylie Hubbard. Texas is a state of mind.
It is difficult to have a surge in homeownership for the 25-54 year old bracket when not a single state in the US has shown improvement in employment rates since 2007.
According to the Pew Charitable Trusts, employment rates for 25- to 54-year-olds were lower in 29 states in fiscal year 2014 than in 2007, before the Great Recession.
Percentage-point Change in Employment Rate, CY 2007 to FY 2014
A state-by-state comparison of calendar year 2007 with fiscal 2014 shows:
1) No state reported employment rate gains for 25- to 54-year-olds.
2) 29 states had statistically significant decreases.
3) The largest decline in the employment rate was in New Mexico, where 69.9 percent of prime-age workers had jobs in fiscal 2014 — 9.2 percentage points lower than in 2007.
4) Among the least affected were Vermont and Nebraska, which recorded the smallest observed changes in their current employment rates of 83.3 and 85.2 percent, respectively.
And it isn’t helping that household incomes and wage growth have declined since 2007.
This is a pitiful economic “recovery.”
Unemployment in the United States is finally below the WORST unemployment rate during the George W Bush Administration. That is like saying you are the smartest person at a Village Idiot convention.
Not only has unemployment been slow to recover, but real median household income has fallen to 1995/1996 levels.
According to Sentier Research, real median household income is recovering, but VERY slowly.
Then we have average hourly wage earnings growth Year-over-year (YoY) that is nearly 50% lower than before the recession in 2007.
And labor share (as opposed to capital share) is near the all-time low since President Carter.
Labor force participation? It has also tanked back to Jimmy Carter-era levels.
In July, the unemployment rate for younger workers, those 20 to 24 years old, including many recent college graduates, was 11.3% – five percentage points higher than the overall unemployment rate in America.
It is higher than anytime since 1994.
Any wonder why M2 Money Velocity is the lowest since Jimmy Carter?
Yes, this is the WORST US employment recovery since Mr. Peanut (aka, Jimmy Carter) was President.