Is Our Problem Unemployment?

I read an interesting story, one that looks at an issue that is important to our economic well being.  It seems that only 47% of working age Americans have a full time job.  That is incredibly low.

Why is the economy weak?  It seems there is not enough jobs to go around.  Most news organizations have been dutifully reporting the Administrations unemployment figures.  Even Vice President Biden has been crowing about the numbers.  The problem is, they are manipulated to make things look better than they are.

There are approximately 245 million working age adults in our country.  Out of this number only 144 million have jobs at all.  Would that not make the real unemployment rate 41%?  But wait, as the TV hawkers say, some of those are people not looking for jobs.  People who are disabled, stay at home Mom's and the like, would not be actively looking for a job.  Most economists would say you can't count those, which seems pretty fair. 

Then there is the underemployed.  Just because some one has a job, doesn't mean it is a job they are qualified for, or even want to do.  Maybe it is part time, or way under the person's skill level, the point is they are not necessarily happy in the job they have.  Underemployment seems to be where we have a problem.  Again, looking at the numbers, only 53% of working age adults have a full time job.  Much more work would have to be done to determine skill matches in those full time jobs, like a PHD working full time at McDonald's. 

There have been some surveys I have read that indicate that many people are not satisfied with their current job.  That would be a non scientific indicator that underemployment is a major issue in today's economy.  And it would seem needs to be researched to find solutions. 

When a person is underemployed, or unemployed, they are less likely to make major purchases, especially if it can be put off.  Many employed see the weakness, and they resist buying because of their worry that the economy may put them in a similar position in the future.  So how does the economy heal?

One of the tenets of my economic philosophy is that the economy is driven by a certain group psychology.  That is mostly about the feeling common people have towards the potential in the macro economy.  The economy goes through cycles, as much as our Keynesian friends want to deny it or say they can mitigate it, these cycles have endured since the beginning of time.  Studying history can shed some light on how to correct this problem.  There has been little experience in the down times of the cycle in recent memory.  The United States has over all been in a distinct upward tact since the mid 1980s.  Yes there has been some pull backs, but over all things have been growing.



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If we look at the late 1970s, and early 1980s, we may be able to find a solution.  What caused us to leave "stagflation" behind then?  What started our economy moving again?  It was a change in attitude by the American public, as much as anything else.  It was not the stimulus per say, but a general feeling that things were getting better, allowing them in their own situations to buy a new car, or appliances, or even a house.  The snowball effect of these purchases raised all other levels.

That is what will happen here as well.  One thing to take into account is how that change of attitude was precipitated.  That is where politics came in.  It is the vision of the President that excites the most change.  Yet this administration seems intent on not displaying any excitement.  One reason our current President was elected originally was his phrase "Hope and Change."  Yet after the election, he seemed to throw it under the bus.  That was not productive in an economic sense.  What he seems to believe is closer to Herbert Hoover or Jimmy Carter than to Franklin Roosevelt or Ronald Reagan.

Things can change, although the potential under the current administration is not high.  Our next Presidential election will prove critical to our status as the leader of the economy of the world.  But right now there is considerable political disarray in our nation, and even the world.  So what do we do in the mean time?

We the People of the United States can change things regardless of the politicians, we consent to their governance, we can change things, even if they show no interest.  We still have substantial liberties and freedoms to affect our lives economically and in other ways.  We need to stay up beat, we need to say enough.  We need to...

Spend Wisely!