Bruce T. Boccardy says the economic model is gradually shredding the lives of working people.
Restaurant worker in San Diego taking orders outside during Covid, August 2020. (Nathan Rupert, Flickr, CC BY-NC-ND 2.0)
By Bruce T. Boccardy
Common Dreams
As the economy gradually melts down into levels of deprivation and drudgery not seen in decades, working people are subjected to a chorus of misinformation from liberal sources.
E. J. Dionne is a columnist for The Washington Post. Speaking on WBUR of National Public Radio on Nov. 8, he applauded the work of the Biden administration with regard to job numbers in October. He cited the standard Bureau of Labor Statistics (BLS) measure which is U-3.
The BLS reported that the unemployment rate in October fell to 4.6 percent. That would be a cause for applause if it was remotely accurate. It certainly is not.
Axios news site declared on Nov. 5 that:
“The job market added a stunning 531,000 jobs last month. The unemployment rate ticked down to 4.6%-a new pandemic-era low.”
John Cassidy, a journalist writing in The New Yorker on Nov. 5, asserted that:
“Employment gains were particularly strong in restaurants and bars, which added nearly a hundred and twenty thousand jobs.”
To be sure, jobs in the restaurant industry increased and many saw their wages raised to $15 an hour.
Cassidy praised the job growth in that industry which appeared to be an accomplishment for the Biden administration. Fifteen dollars an hour was an improvement on decades of poverty wages.
However, a brief review of the cost-of-living in various areas of the country leads to the conclusion that $15 an hour is scarcely enough for working people to live with the basic necessities.
Restaurants operate on paper-thin profit margins and traditionally have relied on low-paid, temporary labor of students or those who hold second jobs. If this is the industry that measures our economic health, rather than manufacturing, then there are serious problems with our economic model.
The Numbers
U.S. Secretary of Labor Marty J. Walsh, right, visiting Dayton, Ohio, Job Corps Center in August. (U.S. Department of Labor, Flickr)
The BLS calculation most cited for unemployment is the aforementioned U-3. It includes:
People without a job who have actively searched for a job in four weeks prior to the survey and currently available for work. People are considered employed if they did paid work, full time, part time and temporary work.
The U-3 does not include:
Marginally Attached—discouraged job seekers who searched for work in the last 12 months and stopped looking in the past four weeks for various reasons.
Part Time — those who want full time work or are underemployed for economic reasons.
Part Time — those who have part time jobs for non-economic reasons.
The BLS created a more accurate calculation in 1994 identified as U-6. It consists of the standard U-3 measure plus marginally attached workers and those working part time for economic reasons.
Actual Numbers
The Ludvig Institute for Shared Economic Prosperity (LISEP) reported a more accurate calculation of the unemployed in America.
LISEP tracked the percentage of the U.S. labor force that does not have a full-time job (35 plus hours a week) but wants one, has no job, or does not earn a living wage, conservatively pegged at $20,000 annually before taxes.
For this September, LISEP calculated unemployment by race: Black unemployment was 27.9 percent, Latinx unemployment was next at 22 percent while white unemployment was 22 percent.
Shadow Government Statistics, (SGS) is also an alternative economics website. SGS calculated the seasonally-adjusted employment rate by including long-term discouraged employees who were defined out of existence in 1994. Their actual total unemployment rate in September was 25.1 percent.
Job Quality
Workers at the L & H beef slaughterhouse in San Antonio, Texas, 2008. (U.S. Department of Agriculture, Flickr)
The BLS reported in its first monthly calculation that 531,000 jobs were created. Superficially, this appears to be an improvement since the economy was crippled by the scourge of Covid-19.
Liberal praise was lavished on the Biden administration for these job creation numbers. However, the types of jobs being created was the most important variable not examined in the calculation.
Our economic model is replete with jobs based on low pay, low benefits, or no benefits.
National surveys report that the vast majority of Americans are struggling with financial burdens that are not ameliorated by the new jobs created in recent years.
Bankrate reported in July 2021 that one half of Americans could not pay three months of emergency spending.
MagnifyMoney reported in February 2020 that 53 percent of those polled live paycheck-to-paycheck and 62 percent don’t have at least three months of savings to hold them over.
Lending Club reported in July that 54 percent of consumers are living paycheck-to-paycheck. Twenty one percent are struggling to pay their bills.
Career Builders reported in April that 34 percent of women and 45 percent of black Americans leaving the workforce accepted a pay cut to become employed again.
The Stacker reported in 2019 that the share of American adults who live in middle-income households decreased from 61 percent in 1971 to 51 percent.
Underemployment
Underemployment is another persistent problem in the U.S. economic model. The Center for Law and Social Policy (CLSP) released a report in August 2020 based on recalculated BLS numbers. CLSP’s more inclusive numbers revealed a part-time underemployment rate double the BLS numbers.
Moreover, Emsi/ Burning Glass Technologies et analytics reported that 43 percent of college graduates are underemployed in their first job; 66 percent of graduates will be underemployed after five years and 75 percent will be underemployed after 10 years.
The numbers plainly show that our economic model is failing to provide sustainable and permanent jobs for the vast majority of the workforce.
Whether the Biden administration’s recent job creation numbers affect the chronic, systemic unemployment and underemployment remains to be determined. The historical record is against it.
Scapegoats
The mainstream corporate media is a key component in dispensing misinformation. The plan is simple. Keep working people distracted from the structural problems in our economic model.
Rather, trot out the usual convenient scapegoats to blame. Those would be “immigrants,” “minorities,” “big government” and “labor unions.”
There is overwhelming evidence that none of the above are responsible for an economy that is gradually shredding the lives of working people:
Immigrants contribute to the economy in many positive ways.
Minorities are suffering the most since the economy began its most recent decline during Covid-19.
Sizable government is essential to maintain and protect the many components of our complex society. Businesses cannot compete without modern transportation, roads, technology, and data security provided by federal spending. Healthcare, childcare, education and family stability are also essential for businesses.
More importantly, the federal government has historically rescued our economic model from its inherent crises.
Lastly, labor unions benefit the economy for all working people and enjoy more support now than they have garnered in many years.
Disinformation Success
Union member listening to U.S. Secretary of Labor Marty Walsh during a visit at Carpenters Local 1912 in Phoenix in August. (U.S. Department of Labor, Flickr)
The prevailing narrative of scapegoats gains currency largely due to the mainstream corporate media. Add to that the relentless and repetitive pack of disinformation distributed by rightwing media at a breathtaking pace. There are approximately 1,500 conservative talk radio stations across the country relentlessly that keep working people marinated in disinformation.
The Columbia School of Journalism reported in July 2020 that Nexstar and Sinclair, companies with a profoundly conservative perspective, now own the majority of television stations in the country.
Remedies
The employment numbers above are testament to the continuing decline of our economic model. A progressive model must be developed to disabuse working people of the destructive path ahead; neo-fascism appears to be closer as a political reality here than imagined in prior decades.
Spiritual and secular entities that oppose the serpentine plans of the controlling class must continue to speak, write and distribute facts. Connect the dots. Facts do matter.
Working people of all races and ethnicity have common interests that transcend the narrow self-defeating prism of identity politics. It is a racket designed to keep working people divided and voting against their own economic interests. Sanctimonious rhetoric about “freedom” and “rights” disingenuously preys on patriotic instincts of working people while robbing them at the same time.
Beneath the noise and confusion today is the unalterable reality that our economic model will continue to proceed as it must until working people figure it out politically and decide that enough deprivation and suffering is enough.
Bruce T. Boccardy serves as an economics and labor adviser for Small Planet Institute, was president of the Massachusetts Service Employees International Union (SEIU) Local 888, represented labor on the Massachusetts Joint Labor-Management Committee (JLMC), serving firefighters and police and consulted to the National Association of Government Employees (NAGE).
This article is from Common Dreams.
The views expressed are solely those of the author and may or may not reflect those of Consortium News.
So true!
“Unemployment claims have dropped dramatically?”
Why?
Because the Federal PUA and state unemployment benefits RAN OUT.
Not much point in filing, now, is there?
If Americans want to find authentic statistics on:
unemployment
the true rate of Inflation
The chief function of The Fed
Go to: www (dot) shadowstats (dot) com (Economist Dr. John Williams
For a broad view of HOW/WHY the US faltering financial hegemony is struggling: see Dr. Michael Hudson’s interviews via Unz Review and The Saker.
Those are the most trusted economists we know.
Thank you for this excellent article!
Well said.
I was hoping something about the necessity of these low paid workers to keep the machine running would have been included with a commentary about what a terrible machine it must be that requires some to work so hard for so little while a good 20+% of the population lives so comfortably upon their backs.
Weaning ourselves from cheap labor at home and abroad and more equitable work places are the direction that is so direly needed.
Yes, Tina, yes.?
“Shadow Government Statistics, (SGS) is also an alternative economics website. SGS calculated the seasonally-adjusted employment rate by including long-term discouraged employees who were defined out of existence in 1994. Their actual total unemployment rate in September was 25.1 percent.”
Boccardy is right on all counts, and his message can’t be repeated too often. The changes in reporting unemployment and inflation made by our government in the 1990s helped conceal the massive upward redistribution of wealth that began with President Reagan. Most Americans probably still think that U3 and U6 refer to German submarines during WWII.
Statistical analysis can always be massaged to provide the desired result, and that’s what the U.S. government does with employment and inflation figures. All the government needed to do to “fix” endemic high unemployment and inflation was to re-define them! Very few noticed, and an increasingly consolidated corporate news media had no interest in challenging the government’s new “methodology.”
If anyone’s interested, the following excerpts from the Shadow Government Statistics website on the government’s revised methodology for measuring inflation are very instructive:
“Measurement of consumer inflation traditionally reflected assessing the cost of maintaining a constant standard of living, as measured by a fixed-basket of goods. Maintaining a constant standard of living, however, is a concept not popular in current economic literature, and certainly not within the thinking or the lexicon of the Bureau of Labor Statistics (BLS), the government’s statistical agency that estimates and reports on consumer inflation….”
“In the early-1990s, political Washington moved to change the nature of the CPI. The contention was that the CPI overstated inflation (it did not allow substitution of less-expensive hamburger for more-expensive steak). Both sides of the aisle and the financial media touted the benefits of a “more-accurate” CPI, one that would allow the substitution of goods and services.”
“The plan was to reduce cost of living adjustments for government payments to Social Security recipients, etc. The cuts in reported inflation were an effort to reduce the federal deficit without anyone in Congress having to do the politically impossible: to vote against Social Security. The inflation-calculation changes had the further benefit to government fiscal conditions of pushing taxpayers artificially into higher tax brackets, thus increasing tax revenues. The changes afoot were publicized, albeit under the cover of academic theories. Few in the public paid any attention.”
Thank you Alley Cat.
Brother Bruce T. Boccardy summed up the labor situation nicely. Thank you!
This is a good article, but to praise the existing trade unions is an error. The majority of the trade unions have been selling out their members for decades, siding with the corporations and accepting crap contracts against the wishes of their members. In the U.S. (and other countries) unions have ratified contracts that 98% of their members rejected! Strikes against John Deere, Kaiser, Dana auto parts, IATSE (film workers), and more have been on strike this year alone and have been pressured by the unions to accept contracts that do nothing to ameliorate the bad working conditions, lack of Covid protection, wages that nobody can live on and other exploitative practices. What is needed are independent rank and file committees of employees to represent the workers. The union leaders are in bed with the capitalists and their high salaries reflect this fact.
The 19% following the top 1% of wealth and income, the professional / managerial class that facilitates the System have the MOST to answer for. They are the true purveyors of mass psychosis.
Exactly
The author fails to acknowledge that most of the wrongs he finds with the current economy existed prior to Joe Biden taking office and most were the result of the actions taken by Trump in the previous 4 years and the absolute lack of creative thought or cooperation by the Republicans in Congress.
Most of the wrongs in the current economy are due to the counter-revolutionary decline in workers’ rights that began under Ronald Reagan and got worse thereafter under both Democratic and Republican administrations. Reagan set the agenda when he fired the PATCO air traffic controllers and things have gone downhill since. Bill Clinton and Barack Obama did their very best to screw the working class, so youo can’t just blame the fascist Trump for that. Clinton trashed welfare and Obama supported the slashing of auto workers’ salaries by half. I could list more but you get my drift.
And in the UK it began with Thatcher – best buddies with Reagan – Coincidence or what ?
What was it about the eighties that bred the mindset in the west that continues to f**k us over ?
You are correct sir.
“Culture War” much Tom. How far down the “Blue Human Centipede” are you? You chose to divide yourself from the majority. Could it be your material and financial privilege?
From my viewpoint, after a long, fully employed, working career it is always useful to go back to first principles and define exactly what a job is:
1. Full time, eg. at least 35 Hrs per week;
2. Appropriate compensation to cover;
a. accommodation, eg. mortgage or rent;
b. sustenance, eg. food and drink;
c. healthcare – either through specific taxation or insurance;
d. pension – either through specific taxation or employer assisted contributory scheme;
e. savings, eg. 25% of net income;
3. Appropriate duration, between, at least, one year and 25 years.
Part time work would only vary in terms of hours worked with other benefits reduced proportionally other than duration.
Anything that doesn’t meet these terms is not, IMO, a job. It is exploitation – and should not be included in employment figures.
Nobody is a lifer at a firm any more. That went out with my father’s generation.
As someone who spent most of his working life with one firm and has a pension (no longer offered by said firm) as a result, I can tell you that it may have gone the way of the dodo but that doesn’t mean we should have wanted that. Nor does it mean that it couldn’t be brought back by appropriate government regulation of business that made it attractive to offer said structures.
Well said Henry! Liked your other comment about the Iron Lady being best buddies with Reagan. Wonder what they will tell St Peter when they get there?
The government plays the same games with the consumer price index. It matters little what the press reports in this regard as those included or not included in the stats know the reality of their lives. And we can only blame right-wing media so much. That people won’t get free jabs to keep from days and weeks of serious illness that can potentially devastate their livelihood and well-being speaks volumes to who people “trust” for their information. That after decades of the government playing games with employment and CPI numbers speaks volumes that anyone would still think the Democrats represent the working class and underclasses of this country. Both parties represent the same “tyrannical principle” to borrow from Mr. Lincoln.
Hear, hear. Thank you.