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Peter Schiff - Lousy Jobs, In Such Small Portions

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November 06, 2009 – Comments (3)

Two dissatisfied customers comment about a restaurant. One says, "The food here is terrible." The other replies, "I know, and such small portions!" In many ways, they could be describing our current employment picture. Not only are the portions shrinking, but the jobs themselves are steadily losing quality.

Today's release of the October jobs report showed the loss of another 190,000 jobs had pushed the official unemployment rate to 10.2%, only the second time since the Great Depression that unemployment was quoted in double digits (factoring in workers who had given up job hunting altogether or have settled for part-time work would push that rate to 17.5%). That didn't stop Wall Street pundits from trying to fashion a silk purse of this sow's ear. The 'green shoots' crowd focused on the slowing pace of job losses, the nascent economic 'recovery' (even if it is jobless), and the projected improvement in 2010. No mention was even made of the quality of what few jobs were being created.

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3 Comments – Post Your Own

#1) On November 06, 2009 at 8:26 PM, russiangambit (29.45) wrote:

>The analysts completely ignored the continued trend of replacing goods-producing jobs with those jobs that require production from other sources. For example, we lost 61,000 manufacturing jobs last month, but added 45,000 jobs in education and health services. In particular, the addition of health workers is nothing to celebrate. Just as a family's economic position is not improved by higher medical bills, the country as a whole does not benefit from increased health-care spending.

 

Good point. Jobs are being added in healthcare and education, but these are secondary industries, finances mostly through various taxes and insuarances.

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#2) On November 06, 2009 at 9:38 PM, amassafortune (29.69) wrote:

Worse still, everyone taking jobs in these sectors will be laid off in the next phase of the crisis – and will have lost this opportunity to build practical skills for the new economy.

Exactly. One year ago, for-profit businesses were cutting workers as part of their plan to survive the downturn. Public institutions did nothing until mid-year 2009 when the imbalance of tax revenue to expenses became obvious. Instead of making cuts, they lobbied for new taxes and stimulus money, or issued IOUs. Here in the midwest, a 0.5% income tax increase passed by a small margin. During last week's election, levies passed that add about $400 of taxes (that's after tax taxes) for the typical household. Even for two-earner families where both workers will receive a raise this year, they just voluntarily gave most of it away to public institutions that have only made minor cuts to their budgets.

I suspect the average resident believes in the recovery, has seen their investments partially recover, and thinks the value of their home will continue to recover. I hope for their sake the "shoots" are for real, because they are now in a weaker position to handle a second dip or any loss of income in 2010.   

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#3) On November 07, 2009 at 2:11 AM, AdirondackFund (< 20) wrote:

Thanks again for posting KDakota.  Real good article, sussinct and to the point, pointing in the direction of where balance can be found in economies, and regretting that either the message isn't being heard or is being deliberately ignored.  I would surmise that it is being deliberately ignored.  This is being done at peril to the public at large.   

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