djAdvocate
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Post by djAdvocate on Sept 26, 2013 11:37:56 GMT -5
the 55+ group that works is actually growing instead of shrinking. because they can't afford not to and their non working spouses have to work because the bread winner is losing. maybe. or it might simply be because they are a larger percentage of the population. think about it.
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Post by Deleted on Sept 26, 2013 11:58:18 GMT -5
That's an interesting point I hadn't thought of... that's odd. i mentioned this idea probably six times before this thread. guess i wasn't clear enough, or didn't use bold in my post. Even if we do to back to 59%, the demographics are completely different from 70 years ago.
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djAdvocate
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Post by djAdvocate on Sept 26, 2013 12:00:33 GMT -5
that's odd. i mentioned this idea probably six times before this thread. guess i wasn't clear enough, or didn't use bold in my post. Even if we do to back to 59%, the demographics are completely different from 70 years ago. i meant age demographics. i am not sure about the "completely" part- but i agree that they ARE different.
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Virgil Showlion
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Post by Virgil Showlion on Sept 26, 2013 12:16:58 GMT -5
That's why resolution's article is so compelling. It debunks this theory as the primary cause of the LFPR decline. Yes. I'm defining a "producer" here as anyone who works enough to be considered "employed" (which I believe is 5 hours a week or more), and a "dependent" as anyone who isn't a producer. I do realize that not all producers are net producers, but the unemployment metrics certainly don't make a distinction. The LFPR quantifies the size of the labour force with respect to the total population, the U3 and U6 metrics provide estimates of "unutilization" and "underutilization" in the labour force itself. The fraction of your population that produces is roughly given by LFPR · (1 - U6). If you assume the "labour force" should be some fixed percentage of the adult population, you get unemployment statistics that look like the ones Mr. Williams posts on ShadowStats under EMP ALT.
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Virgil Showlion
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Post by Virgil Showlion on Sept 26, 2013 12:27:19 GMT -5
there is a problem reading too much into that statistic. here is why: if the population that is NOW between 50 and 70 is distorted relative to the overall birthrate trend, then it affects ALL ASPECTS of employment. it is TRUE that there are more employed in that group than before (that trend will continue probably through 2028). but is ALSO true that there are more UNEMPLOYED. and since FAR MORE PEOPLE over 55 are unemployed (retired, etc) than employed, it distorts the OVERALL WP figure DOWNWARD. if you don't believe me, ask our resident statistician, Virgil. The article says plainly that boomer demographics only accounts for about 30% of the post-recession shift in the LFPR. The other 70% it claims is due to "cyclic factors", which is a fancy way of saying "the whims of booms and busts in the labour market". "Cyclic" of course implies they believe things will eventually get better, which isn't surprising given this is the St. Louis Fed. In their preamble they cite another study that attributes even more than 70% of the swing to conditions in the labour market. And as for the boomers distorting "ALL ASPECTS" of employment, the simple answer is "yes", although I'm not quite sure what you're arguing above. The trend the article makes is that boomers are staying employed, and younger generations aren't getting employed as often as they "should". But none of the metrics we're talking about: the LFPR, the U3, the U6, the figures in the Levin paper, make summary assumptions about employment or "should be employed" based on age. ETA: The other hidden 800-pound gorilla that not even the LFPR quantifies is the shift from full-time to part-time work. Average hours worked has seen notable declines, especially in recent months. Ordinarily we would expect to see this reflected in negative GDP growth, but as you know, they recently decided to screw with the canonical GDP calculation, which buys them a phantom margin of about 3.5%. If things deteriorate further, I have no doubt they'll pull another rabbit out of their hat, or hopefully keep people so distracted with the ACA kabuki theatre that nobody notices.
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Post by resolution on Sept 26, 2013 12:50:20 GMT -5
there is a problem reading too much into that statistic. here is why: if the population that is NOW between 50 and 70 is distorted relative to the overall birthrate trend, then it affects ALL ASPECTS of employment. it is TRUE that there are more employed in that group than before (that trend will continue probably through 2028). but is ALSO true that there are more UNEMPLOYED. and since FAR MORE PEOPLE over 55 are unemployed (retired, etc) than employed, it distorts the OVERALL WP figure DOWNWARD. if you don't believe me, ask our resident statistician, Virgil. As @virgil has responded, the study has allowed for the demographic shift. It compared the projected employment levels with actual levels, but all the projections allowed for the aging population. It determined that the state of the economy and labor market was responsible for most of the shift. I thought they had some interesting reasoning about why a deeper recession would have more impact than a small recession due to the cost of shifting a household member in or out of the labor market. However, a lot of the math escaped me.
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djAdvocate
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Post by djAdvocate on Sept 26, 2013 13:01:17 GMT -5
there is a problem reading too much into that statistic. here is why: if the population that is NOW between 50 and 70 is distorted relative to the overall birthrate trend, then it affects ALL ASPECTS of employment. it is TRUE that there are more employed in that group than before (that trend will continue probably through 2028). but is ALSO true that there are more UNEMPLOYED. and since FAR MORE PEOPLE over 55 are unemployed (retired, etc) than employed, it distorts the OVERALL WP figure DOWNWARD. if you don't believe me, ask our resident statistician, Virgil. As @virgil has responded, the study has allowed for the demographic shift. It compared the projected employment levels with actual levels, but all the projections allowed for the aging population. It determined that the state of the economy and labor market was responsible for most of the shift. I thought they had some interesting reasoning about why a deeper recession would have more impact than a small recession due to the cost of shifting a household member in or out of the labor market. However, a lot of the math escaped me. res- i was ONLY commenting on your comment about "employment increasing among those over 55+". i was acknowledging that fact, and offering an explanation as to WHY the WFP numbers could still fall due to the age wave. i did NOT read your study as i am hustling to make a shipment today (personal delivery).
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Post by Deleted on Sept 26, 2013 13:05:01 GMT -5
Having read through the whole thing to date, I am going to operate as if I hadn't. From the OP: There's a prior, contextualizing question that needs to be addressed first. I'm about to perform the reframing exercise implied there, in the vague hope it sheds some light on dj's questions. First, a definition: You may have labored (no pun intended) under the delusion that labor force participation included only employed persons. It doesn't. Unemployed people also 'participate' in the labor force. Dj's graph in the OP shows labor force participation peaked at around 67% in 2000. U6 unemployment, measuring the 'unemployed' component of labor force participation, has varied as shown at Portal Seven from around 7% then, up to a peak of around 17% in 2010, and then back to around 14% today. So, one way we can recontextualize this rate is to look at variations in the 'employed' population - the 'employment to population ratio.' That's tracked by BLS as well, but I'm going to derive it here from mine and dj's primary data. Year Approx WFP rate Approx U6 rate Implicit employment rate2000 67% 7% 60%2013 63.3% 14% 49.3%
The BLS figure is a lot rosier than that, at 58.6%. I'll be keen to see if anyone can see what's wrong in my calculation, because according to me we've gone from a situation of having three workers for every two non-workers in the working-age population when Bush took office to a situation of having fewer workers than non-workers. Coupled with the trend I identified in the other thread for dropouts from the labor force, the trend Virgil (I think) alluded to of trading full-time for part-time work (odiously scored as a 'new start' in labor statistics rather than a downgrading of labor), and the trend of declining real wages, I think we can see that something is structurally wrong with the labor market, and that a tipping point has been reached. Unless you can see what I did wrong above. Edit: Okay, I spotted it, or part of it. U6 is a better measure of unemployment, I think, but U3 is the complement of 'employed' in the ILO definition. Then we've gone from (67-4)% in 2000 to (63.3 - 7)% in 2013. Still a decline from 63% employment to 56.3%, and still not in line with the BLS number. But it suggests that where the ratio of employed:unemployed working age civilians in the US was around 7:4 in 2000, it is now only 4:3.
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Post by jkapp on Sept 26, 2013 13:28:05 GMT -5
That's an interesting point I hadn't thought of... that's odd. i mentioned this idea probably six times before this thread. guess i wasn't clear enough, or didn't use bold in my post. Or I may not have seen those posts/threads - yes, please bold that stuff
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Post by Deleted on Sept 26, 2013 13:36:58 GMT -5
Interesting addendum, harking back to the "tradition" of including workers over 65 among the labor force.
In 2000, 35 million people (12.4% of the population) were over 65 in the US.
The most current estimate I could find at short notice suggests that in 2012, around 43 million people (13.5% of the population) were over 65 in the US.
The projection for 2060 from the 2010 census is for an over-65 population of 92 million (21.9% of the population).
Labor force participation among this cohort is growing, for several reasons, most of them negative in implication, but remains substantially lower than among the real 'working-age' cohort of 16-64 year olds (roughly three-quarters of whom are 'employed').
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Post by fairlycrazy23 on Sept 26, 2013 13:42:11 GMT -5
I'm not really good at math, but if the WFP is 67% and U6 rate is 6%, that would only be 6% of the 67% right? so the employment rate would be about 63% and for 63.3/14 it would be about 54.
67-(67*.06)~=63 63.3-(63.3*.14)~=54
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Post by Deleted on Sept 26, 2013 13:58:45 GMT -5
I'm not really good at math, but if the WFP is 67% and U6 rate is 6%, that would only be 6% of the 67% right? so the employment rate would be about 63% and for 63.3/14 it would be about 54. 67-(67*.06)~=63 63.3-(63.3*.14)~=54 Firstly, I mistyped - the U6 figure for 2000 should be 7%. Mea culpa. I have gone back and edited. Secondly, WFP rate is defined as the SUM of the employment and unemployment rate. If 7% of the TOTAL WORKFORCE are unemployed, and 67% of the TOTAL WORKFORCE are 'participating', then (67-7)%, or 60%, must be 'employed.' Thanks for catching my error though.
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Post by Deleted on Sept 26, 2013 14:08:41 GMT -5
Another recontextualization:
In hard numbers, 67% of the 2000 civilian non-institutional population of 212,577,000 was 142,426,590. The non-U6 'employed' cohort there was 127,546,200.
By contrast 63.3% of 245,959,000 - the most recent figure - is 155,692,047. The non-U6 'employed' cohort there is 121,257,787.
This represents an actual decline in full-time equivalent employment over that decade or so of more than 6 million jobs, at the same time as the working-age population swelled by more than 33 million.
If you look at 'non-U3', i.e. headline employment, the change is from 133,923,510 to 138,474,917 - but that apparent increase of around 4,500,000 jobs over 156 months (a whole 29,000 a month on average) includes those 'marginally attached' and subsisting in part-time work when they want full-time.
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fairlycrazy23
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Post by fairlycrazy23 on Sept 26, 2013 14:38:54 GMT -5
Why on earth do they include people over 65 in the calculations? Most people that age are retired. That throws things off big time if the population gets older. And having that graph start at 58% and end at 65% also makes the changes look bigger than they are. Workforce participation went from just over 67% to around 63% between 2000 and now. That's not an enormous drop, especially when you take into account the aging population and the fact that folks over 65 are included in the denominator. If they are retired they are not looking for work and therefore are not in the labor force. The age doesn't matter for the basic statistic.
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Post by dumdeedoe on Sept 26, 2013 20:52:54 GMT -5
25 years old and up are increasing job participation, with the largest % increase being the 55 year old and up group. With the youngest; 16-24 year old group, lagging far behind... I blame MTV.......... Once upon a time, 18- to 25-year-olds were considered adults.That's a fairy tale now, say most parents of college students, and their kids agree in a new study that confirms "growing up" comes later. usatoday30.usatoday.com/news/health/2007-12-12-emerging-adults_N.htmIts not their fault after all they are just children.... Kinda strange that the older are more worried about their future than the young are. Must a societal factor in here some where. there are either: a) no jobs for youth or b) unmotivated youth
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Post by dumdeedoe on Sept 26, 2013 21:07:22 GMT -5
The United Nations Children's Fund, UNICEF, says 60% of the estimated 350 million child laborers worldwide are in Asia, although it gives no specific figure for China and the country isn't named as one of the worst offenders. Very small children are often used in South Asian countries with industries such as carpet making. usatoday30.usatoday.com/news/world/2007-09-03-china-labor_N.htmYouth seems to be well employed in the far east... Kinda funny that our slackers are using cell phones made by kids that are younger than them...
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djAdvocate
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Post by djAdvocate on Sept 27, 2013 0:02:28 GMT -5
interesting. so the labor participation rate among 16-24 year olds has been falling for THIRTY FIVE YEARS? wow. that is very revealing. you think- just maybe- that might have something to do with the marketplace demanding HIGHER EDUCATIONAL ATTAINMENT? my head hurts. edit: ok, hurts less now. did anyone else consider that all of these graphs may just be showing "regression to the mean"? hmmm?
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Virgil Showlion
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Post by Virgil Showlion on Sept 27, 2013 0:24:12 GMT -5
Mean regression pertains to a "snap" back to mean values after a string of outliers (typically just one or two data points), not 65 years of trend data.
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djAdvocate
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Post by djAdvocate on Sept 27, 2013 0:51:22 GMT -5
Mean regression pertains to a "snap" back to mean values after a string of outliers (typically just one or two data points), not 65 years of trend data. fine. use the term "mean reversion" as it is used in economics (ie, to describe stock returns over periods of approximately 30 years). again, i would go back to the post article, which agreed with my assessment. did you read it?
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Post by Deleted on Sept 27, 2013 6:36:14 GMT -5
DJ I'd say you are almost certainly correct about the trend being due to more young people going to college.
Mojo, one adjustment to what you were saying: Wages has not been a legitimate means to track worker compensation for decades. There is too much non-wage compensation going on.
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Post by AgeOfEnlightenmentSCP on Sept 27, 2013 8:37:01 GMT -5
There are two answers to the question posed by the OP- and no, I have not, and likely will not due to time constraints, read the whole thread to this point. So, forgive me if we've covered this. The two answers are: 1. Unimportant. Provided people are working, innovating, investing, and otherwise supporting themselves I haven't a care in the world how many of them are being issued a W-2, or a 1099 and counted by the Bureau of Labor Statistics. And it won't matter to the country as a whole, either. 2. Important. Provided the trend is that people are exiting the workforce in favor of welfare and entitlements that rely on the productivity of others- especially the payroll taxes collected on the W-2, and 1099 incomes of people that work. So, my question- and how we will determine the ultimate answer is: how important is workforce participation to those not participating in the workforce?
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Post by formerroomate99 on Sept 27, 2013 8:58:16 GMT -5
I would say it is very important to those who are out of the workforce but would like to get back in. Dh is a SAHD and his father is retired, and both of them would love to get some part time gigs, but they both know their chances are slim while the economy is in the tank.
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Post by formerroomate99 on Sept 27, 2013 9:06:42 GMT -5
You can hardly blame a young person for coming of age when the economy is in the tank. I've worked W2 jobs since I was 15, but when I was that age, the economy was booming, employers were begging for workers, I wasn't competing against unemployed adults, and because of this, employers were much more forgiving of my teenaged immaturity. By the time I graduated high school, I had a couple year's work experience under my belt.
Today's young people aren't so lucky. An awful lot of growing up happens at those first teenager jobs. It's a lot harder for a teenager or young person to get and keep jobs when you're competing against adults with work expreience, and if you can't get those jobs when you're a teenager, you miss out on the experience and maturity that comes with it.
Now I'm not blaming all the 'failure to launch' issues on this, just saying it is a factor.
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Post by Deleted on Sept 27, 2013 9:25:58 GMT -5
Contrary to claims about "stagnant wages", standard of living has also risen a lot in the last 30-50 years. Teenagers may simply be less inclined to look for jobs for one reason or another (i.e. family is not struggling, they get a great allowance, etc.). Not necessarily a bad thing. Plus, what DJ says about higher education. And what do college grads often do when they can't find a job? Many go back to school and get a masters degree.
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formerroomate99
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Post by formerroomate99 on Sept 27, 2013 11:11:20 GMT -5
25 years old and up are increasing job participation, with the largest % increase being the 55 year old and up group. With the youngest; 16-24 year old group, lagging far behind... I blame MTV.......... Once upon a time, 18- to 25-year-olds were considered adults.That's a fairy tale now, say most parents of college students, and their kids agree in a new study that confirms "growing up" comes later. usatoday30.usatoday.com/news/health/2007-12-12-emerging-adults_N.htmIts not their fault after all they are just children.... Kinda strange that the older are more worried about their future than the young are. Must a societal factor in here some where. there are either: a) no jobs for youth or b) unmotivated youth Well, there's that in the 16-24 group. But the mixture of 16-18 year olds vs 18-24 year olds in that group are also a factor. A 16 year old not working is one thing, After all, teenagers can't work without their parent's permission, and they can't choose where they live (and the transportation issues that come with it). A 23 year old not working is something else entirely, even if that person is still in school.
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Post by formerroomate99 on Sept 27, 2013 11:13:16 GMT -5
Contrary to claims about "stagnant wages", standard of living has also risen a lot in the last 30-50 years. Teenagers may simply be less inclined to look for jobs for one reason or another (i.e. family is not struggling, they get a great allowance, etc.). Not necessarily a bad thing. Plus, what DJ says about higher education. And what do college grads often do when they can't find a job? Many go back to school and get a masters degree. Honestly, if my mom had been dumb enough to hand me a car and a decent sized allowance, I wouldn't have worked at all as a teenager. Thankfully, she was smart enough to let me work for what I wanted, didn't choose to live on top of a mountain, and jobs were plentiful at the time.
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Post by workpublic on Sept 27, 2013 11:38:52 GMT -5
imho the older workers aren't participating because no one will hire them
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Post by Angel! on Sept 27, 2013 11:39:16 GMT -5
I'm not really good at math, but if the WFP is 67% and U6 rate is 6%, that would only be 6% of the 67% right? so the employment rate would be about 63% and for 63.3/14 it would be about 54. 67-(67*.06)~=63 63.3-(63.3*.14)~=54 Firstly, I mistyped - the U6 figure for 2000 should be 7%. Mea culpa. I have gone back and edited. Secondly, WFP rate is defined as the SUM of the employment and unemployment rate. If 7% of the TOTAL WORKFORCE are unemployed, and 67% of the TOTAL WORKFORCE are 'participating', then (67-7)%, or 60%, must be 'employed.' Thanks for catching my error though. WFP measures how many Employed+Unemployed/All people 18+. U6 is a ratio of Unemployed+Underemployed/Employed+Unemployed. You have to do the math as fairlycrazy did because the denominators don't match. The 7% for the U6 is 7% of the 67% because nowhere in the math does the U6 include all people 18+.
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Post by djAdvocate on Sept 27, 2013 11:44:31 GMT -5
Contrary to claims about "stagnant wages", standard of living has also risen a lot in the last 30-50 years. Teenagers may simply be less inclined to look for jobs for one reason or another (i.e. family is not struggling, they get a great allowance, etc.). Not necessarily a bad thing. Plus, what DJ says about higher education. And what do college grads often do when they can't find a job? Many go back to school and get a masters degree. that might be true, ib- but it is also true that whatever wage gains were made were consumed by larger houses and bigger medical bills. i don't think either really improved the "standard of living" for the average American, but i might be mistaken.
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Post by Deleted on Sept 27, 2013 11:45:32 GMT -5
imho the older workers aren't participating because no one will hire them Are you even looking at the data? The older demographic as a % of the workforce is growing.
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