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Are jobs and employment rates really what we should be using to measure the economic outlook? Some people would be better off unemployed on government help, tha

by elhudy 5y ago

Are jobs and employment rates really what we should be using to measure the economic outlook? Some people would be better off unemployed on government help, than employed full time at minimum wage in a city where housing is unaffordable and inflation is at 5%. Additionally, increased spending can be a symptom of inflation as consumers rush to buy goods where prices lag.

abfan1127 5y ago
how is this statement remotely true? Now is government help better than min wage? housing is still unaffordable and inflation is still 5%. There is no wealth creation on government assistance. In fact, there is wealth destruction.
- elhudy 5y ago
  I’m not saying that people being on government help is better for the economy than people working at minimum wage. I’m saying that maybe employment rates aren’t as relevant of a measure as they once were, because employment at min wage isn’t as useful to the individual as it was 10, 20 years ago.
  - refurb 5y ago
    I suggest you look at the employment data breakdown. The DOL goes into a lot of detail about what jobs are created, at what pay, etc.
    - elhudy 5y ago
      What do you believe the data will say about my statement? Will the data disprove it?
      - refurb 5y ago
        The data will show that policy makers don't just look at the unemployment rate, they look at the underlying drivers. And it will also show very few people actually make minimum wage and most of them are young teenagers.
        elhudy 5y ago
        I think you’re giving policy makers too much credit by saying they look at the data, but that’s an aside :). I’m not sure we even have to look at the data ourselves to find my statement true, if we accept the following as facts: 1) Wages have largely remained stagnant in the past 10 years 2) Inflation has increased in the past 10 years 3) Housing and healthcare costs have increased in the past 10 years Thus, even if employment is exactly as it was ten years ago, it doesn’t seem meaningful in understanding economic health.
        refurb 5y ago
        You don't think policy makers look at the data? Have you looked at the data?
        elhudy 5y ago
        It was tongue in cheek
        sokoloff 5y ago
        Real wages* have been roughly flat for quite some time. That statement covers 1 and 2 above, yet people often include both as if the second one represented a new problem in light of the first. You’ve included a third statement which restates/clarifies a portion of #2. All of those statements are true, provided you’re talking about real wages, but then those are closer to 1.5 independent facts than 3.0. https://www.pewresearch.org/fact-tank/2018/08/07/for-most-us-workers-real-wages-have-barely-budged-for-decades/?amp=1 https://www.pewresearch.org/fact-tank/2018/08/07/for-most-us...
        elhudy 5y ago
        You just cited a source from 2018. Are real wages still flat, right now in 2021, or are they down? Do you think wages hiked 6.2% with inflation over the past few months? BLS says real wages at -1.2% over the last year, and thats probably conservative. Combined with my third point it sounds a bit scary dont you think? https://www.bls.gov/news.release/realer.nr0.htm https://www.bls.gov/news.release/realer.nr0.htm I could easily combine points 1 and 2 to your point but imo it makes more sense to separate because inflation and how we measure it is at the heart of the issue.
- pyaccount 5y ago
  If you don’t need to be in a place with jobs, you can surely find a cheap place to stay. For a lot of Americans, it means they can find a free place to stay, like with relatives.
pcwalton 5y ago
It's easy to forget, but housing is affordable for most people in most parts of the US. Here on HN it seems otherwise because we disproportionately live in California and other expensive metropolitan areas along the coasts. Rising prices of gasoline are the most visible sign of inflation for ordinary US consumers.
- elhudy 5y ago
  The issue i take with this is that we’re using measures to define economic well being where we use terms like “most” and then leave behind the other 49% of people, and tell em, “hey, the economy is cookin!” “In the nation as a whole, 70.3 percent of lowest-income households face severe housing cost burdens. ” [1] (2016) [1]https://www.jchs.harvard.edu/sites/jchs.harvard.edu/files/harvard_jchs_state_of_the_nations_housing_2017_chap1.pdf https://www.jchs.harvard.edu/sites/jchs.harvard.edu/files/ha...
  - kube-system 5y ago
    I'm surprised that nearly 30 percent of households earning under $15,000 a year don't face severe housing cost burdens. Although, do we expect that group of people to be able to easily afford housing in a good economy? I would guess that this group has a tough time affording housing in any economy.
    - elhudy 5y ago
      Yeah, agreed. I don’t know what the proper measure of a good economy is. I’m just critical that said measurement is “jobs”.
    - akiselev 5y ago
      How many of those households are in remote or dying communities like those in Appalachia built around long closed coal mines? 2000 hours a year at minimum wage is roughly that amount so I suspect much of that group is concentrated in areas where houses could literally be bought for a few thousand bucks and there really isn't any work - think Detroit at the end of the 2000s when people were ripping copper out of the walls. Depending on how they count households, a few people might also be providing for a large number of house holds, like in a trailer park. With social security/medicare/medicaid/disability, they might be relatively secure in their housing.
throw0101a 5y ago
> Are jobs and employment rates really what we should be using to measure the economic outlook? That was not the point I was trying to make. I'll try again: * Self-identified GOPers (supposedly) think it is worse now than when economy was tanking and hemorrhaging 800K jobs per month. What planet are they living on if they honestly think this is true?
- HarryHirsch 5y ago
  There's a pandemic going on in Jesusland. No one is prepared to go out and spend under such conditions. Can't find fault with the reasoning.
- deleted 5y ago
  [deleted]
- Nbox9 5y ago
  Inflation was under control in 2009. The reasons people are worried about today’s economy are very different than 2009.
  - throw0101a 5y ago
    Yeah, when an economy is losing 800K jobs per month inflation is usually not a problem, deflation is. In 2009 things went negative: * https://fred.stlouisfed.org/series/FPCPITOTLZGUSA https://fred.stlouisfed.org/series/FPCPITOTLZGUSA Inflation is usually sign that the economy is running too hot. I think a lot of folks would say that's a 'nice problem' to have.
- elhudy 5y ago
  Point taken, but i suppose i don’t see it as incredibly unreasonable. They think the outlook is worse now than when we were basically at rock bottom. March 2009 is about when i threw all my money into stocks and purchased a home. When you’re at rock bottom is when your expectations should actually be higher. When the economy is cooking and we have all these artificial props keeping us up with insane healthcare spending and inflation on the rise, is when I’m more likely to have lower outlook. Unless I’m mistaken it’s a measure of where you’re trending not where you are in a point in time.
A4ET8a8uTh0 5y ago
<<Some people would be better off unemployed on government help, than employed full time at minimum wage in a city where housing is unaffordable and inflation is at 5%. I mean it is true. It is virtually impossible to categorize the statement as false. And yet it is wrong in the context of existing society without some additional qualifications.

by elhudy 5y ago

abfan1127 5y ago

how is this statement remotely true? Now is government help better than min wage? housing is still unaffordable and inflation is still 5%. There is no wealth creation on government assistance. In fact, there is wealth destruction.

elhudy 5y ago
I’m not saying that people being on government help is better for the economy than people working at minimum wage. I’m saying that maybe employment rates aren’t as relevant of a measure as they once were, because employment at min wage isn’t as useful to the individual as it was 10, 20 years ago.
- refurb 5y ago
  I suggest you look at the employment data breakdown. The DOL goes into a lot of detail about what jobs are created, at what pay, etc.
  - elhudy 5y ago
    What do you believe the data will say about my statement? Will the data disprove it?
    - refurb 5y ago
      The data will show that policy makers don't just look at the unemployment rate, they look at the underlying drivers. And it will also show very few people actually make minimum wage and most of them are young teenagers.
      - elhudy 5y ago
        I think you’re giving policy makers too much credit by saying they look at the data, but that’s an aside :). I’m not sure we even have to look at the data ourselves to find my statement true, if we accept the following as facts: 1) Wages have largely remained stagnant in the past 10 years 2) Inflation has increased in the past 10 years 3) Housing and healthcare costs have increased in the past 10 years Thus, even if employment is exactly as it was ten years ago, it doesn’t seem meaningful in understanding economic health.
        refurb 5y ago
        You don't think policy makers look at the data? Have you looked at the data?
        elhudy 5y ago
        It was tongue in cheek
        sokoloff 5y ago
        Real wages* have been roughly flat for quite some time. That statement covers 1 and 2 above, yet people often include both as if the second one represented a new problem in light of the first. You’ve included a third statement which restates/clarifies a portion of #2. All of those statements are true, provided you’re talking about real wages, but then those are closer to 1.5 independent facts than 3.0. https://www.pewresearch.org/fact-tank/2018/08/07/for-most-us-workers-real-wages-have-barely-budged-for-decades/?amp=1 https://www.pewresearch.org/fact-tank/2018/08/07/for-most-us...
        elhudy 5y ago
        You just cited a source from 2018. Are real wages still flat, right now in 2021, or are they down? Do you think wages hiked 6.2% with inflation over the past few months? BLS says real wages at -1.2% over the last year, and thats probably conservative. Combined with my third point it sounds a bit scary dont you think? https://www.bls.gov/news.release/realer.nr0.htm https://www.bls.gov/news.release/realer.nr0.htm I could easily combine points 1 and 2 to your point but imo it makes more sense to separate because inflation and how we measure it is at the heart of the issue.
pyaccount 5y ago
If you don’t need to be in a place with jobs, you can surely find a cheap place to stay. For a lot of Americans, it means they can find a free place to stay, like with relatives.

pcwalton 5y ago

It's easy to forget, but housing is affordable for most people in most parts of the US. Here on HN it seems otherwise because we disproportionately live in California and other expensive metropolitan areas along the coasts. Rising prices of gasoline are the most visible sign of inflation for ordinary US consumers.

elhudy 5y ago
The issue i take with this is that we’re using measures to define economic well being where we use terms like “most” and then leave behind the other 49% of people, and tell em, “hey, the economy is cookin!” “In the nation as a whole, 70.3 percent of lowest-income households face severe housing cost burdens. ” [1] (2016) [1]https://www.jchs.harvard.edu/sites/jchs.harvard.edu/files/harvard_jchs_state_of_the_nations_housing_2017_chap1.pdf https://www.jchs.harvard.edu/sites/jchs.harvard.edu/files/ha...
- kube-system 5y ago
  I'm surprised that nearly 30 percent of households earning under $15,000 a year don't face severe housing cost burdens. Although, do we expect that group of people to be able to easily afford housing in a good economy? I would guess that this group has a tough time affording housing in any economy.
  - elhudy 5y ago
    Yeah, agreed. I don’t know what the proper measure of a good economy is. I’m just critical that said measurement is “jobs”.
  - akiselev 5y ago
    How many of those households are in remote or dying communities like those in Appalachia built around long closed coal mines? 2000 hours a year at minimum wage is roughly that amount so I suspect much of that group is concentrated in areas where houses could literally be bought for a few thousand bucks and there really isn't any work - think Detroit at the end of the 2000s when people were ripping copper out of the walls. Depending on how they count households, a few people might also be providing for a large number of house holds, like in a trailer park. With social security/medicare/medicaid/disability, they might be relatively secure in their housing.

throw0101a 5y ago

> Are jobs and employment rates really what we should be using to measure the economic outlook? That was not the point I was trying to make. I'll try again: * Self-identified GOPers (supposedly) think it is worse now than when economy was tanking and hemorrhaging 800K jobs per month. What planet are they living on if they honestly think this is true?

HarryHirsch 5y ago
There's a pandemic going on in Jesusland. No one is prepared to go out and spend under such conditions. Can't find fault with the reasoning.
deleted 5y ago
[deleted]
Nbox9 5y ago
Inflation was under control in 2009. The reasons people are worried about today’s economy are very different than 2009.
- throw0101a 5y ago
  Yeah, when an economy is losing 800K jobs per month inflation is usually not a problem, deflation is. In 2009 things went negative: * https://fred.stlouisfed.org/series/FPCPITOTLZGUSA https://fred.stlouisfed.org/series/FPCPITOTLZGUSA Inflation is usually sign that the economy is running too hot. I think a lot of folks would say that's a 'nice problem' to have.
elhudy 5y ago
Point taken, but i suppose i don’t see it as incredibly unreasonable. They think the outlook is worse now than when we were basically at rock bottom. March 2009 is about when i threw all my money into stocks and purchased a home. When you’re at rock bottom is when your expectations should actually be higher. When the economy is cooking and we have all these artificial props keeping us up with insane healthcare spending and inflation on the rise, is when I’m more likely to have lower outlook. Unless I’m mistaken it’s a measure of where you’re trending not where you are in a point in time.

A4ET8a8uTh0 5y ago

<<Some people would be better off unemployed on government help, than employed full time at minimum wage in a city where housing is unaffordable and inflation is at 5%. I mean it is true. It is virtually impossible to categorize the statement as false. And yet it is wrong in the context of existing society without some additional qualifications.