Job Growth: Please sir, can I have some more?
In January, the United States added 240,000 jobs. In February, 227,000.
However, in a somewhat muted statement, the Congressional Budget Office went on record that saying throughout 2013 unemployment would stay above 8% and potentially stay above 9%. I’m curious to know how that got buried in the news cycle. The budget office is probably looking at the same statistics that I’m looking at. I would also think that the economists that have been muted are also looking at the same statistics that I’m looking at. The United States Bureau of Labor Statistics has been keeping records for some time and has very good statistics associated with our job growth and how more industries add jobs since World War II. So when I hear economists and the budget office of our Congress talking about job growth, I tend to listen a little bit more than I do to the broadcasters of Fox news, MSNBC and CNN.
I have decided to start talking more about our job growth, or our lack thereof. It seems it is not getting the press that it needs to get, given that this is an election year. I have been doing research to better understand our demographics in the United States, the growth of immigration and how it relates to labor, the surge of dual income houses over the past 30 years, the ongoing trend for people to stay in the work place beyond the age of 62, and other social trends. The simple truth is that each month of the year, our economy needs to add approximately 125,000 jobs in order to sustain its population density and its growth. Without that addition, we are actually in the negative for job growth. In the winter of 2008, we sustained the job losses we have all heard about – to the tune of an additional nine million more unemployed than “normal” levels.
Nine million short. Statistically, we could triple the needed job growth from 125,000 to 375,000 and it would take us at least three years to probably reach the unemployment levels that we have prior to the winter of 2008. That’s a sobering fact. In order to do that, we would have to sustain a triple local job growth in 36 months. That also means we need to significantly increase the output for jobs we have had in the last two months, and they were the best months in three years. Looking at the the labor statistics that have been published, I haven’t seen that kind of job growth by percentage or sustainability looking as far back as the 1960s.
I’m not trying to be Debbie Downer. I’m just looking at statistics that are currently available. There’s been a lot of talk about job growth, and there is rhetoric that is circulating in the United States political environment. The news cycle tends to be limited to what’s going on in the United States, and I encourage you to investigate some of the job growth or lack thereof that exists outside the United States.
Over the next few weeks and months as I continue to talk about this topic, I will simply publish ideas on job growth. There are ways that we can do it, but we need to face the reality that US job growth will not occur at the 300,000+ jobs per month level. I know we need to start realizing that that is a very tall order.
As I have ideas, they really will break into two types – INCREASES and DECREASES. The way to stimulate profit in a business is to impact both revenue AND expenses. Job growth is no different. We need to get more jobs available, but also control the amount of people who come into or leave the workforce. I am not going to really introduce an idea unless I think it can have a net effect of at least 100,000 jobs, which will add to the regular job growth.
Increase Idea – Militarize border, immigration, and homeland security departments of the government. We have more military folks coming home, and less work for them to do. In the meantime, we have several burning platforms on security. The military has targeted less armed ground forces, which is a direct impact on labor. However, you can place more feet on the street, especially in border states, major port cities, and along our coasts. As we reduce our military assets in foresight lands, keep those people employed by having then do work here on our own soil. We could easily augment security in our own borders. There are 80,000 troops remaining in Afghanistan, and there were over 40,000 in Iraq last year. Not to mention the 248000 out of work Iraq and Afghanistan veterans. We could use some strong experience in protecting and monitoring our own security, and there are certainly plenty of qualified people. Realize by militarizing these departments, Congress has to use the Defense budget to fund the activities, and Defense is one of the largest spending categories. Now, there are not that many border agents – about 20,000. So I am not suggesting multiplying that by 10. However, as a country we have focused our efforts on border security and terrorist activities, and we can change that strategy. Costs to increase these types of security? At G-12 levels, it’s about $65,000 in salary, and probably at least that in equipment and support. So if we augment by 100,000? $13 billion annually. Check out the Iraq / Afghanistan appropriations over the past few years. This is not even a 1% of those costs, and we are keeping many of these SAME people employed.
Decrease Idea – Bring back apprenticeships. Where did they go? About 3MM students graduate from high school in this country each year. Many go to college, some to the military and others to the working world. The college bound and military bound don’t impact short term job growth – but the entering do. We need to slow that pace down. There is a tremendous need for trade work in this country and there is a need for more technology work involving design, programming, and coding. All require training, but actually they require more experience and hours. So let’s get apprenticeships back in vogue. New high school grads go into jobs for skills, earn less money, and they should stay at home to reduce expenses (sorry mom and dad). After a few years, these employees start their own businesses, get experienced level jobs, and are earning some serious money – usually north of $75,000 a year. They will likely have no debt, and serious coin in the bank (if they are responsible). We now have thousands of 22 to 23 year olds with 4 years experience in a trade with real skills, no debt, and making good money. There are obvious social wins here too. In addition, this actually ADDS jobs to the marketplace. The pay is so low that many people who are already in the trades won’t compete for these jobs, and they are easier to afford than traditional entry level jobs.