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A blog post by Mark Price, originally published at Third and State.
Jack Markowitz, a retired editor, has a column in the Pittsburgh Tribune-Review this morning where he argues that high unemployment among today’s youth is the result of poor personal habits and values. Markowitz bases this argument on a story he tells about two young men — one employed with a failed marriage and living with his parents rent free, and the other an unemployed ex-convict. Markowitz is, in effect, arguing that the rise in unemployment is the result of a wholesale outbreak of vice among the young which happened to coincide with the beginning of the recession.
This is absurd. Youth unemployment is at record highs because unemployment generally in the economy is at record highs. Young workers have the highest unemployment rates because, with the least amount of job market experience, they are typically the least likely to be picked from a stack of resumes to be offered a job interview, not to mention a job.
Markowitz argues that if today’s youth were not scrofulous ne’er-do-wells, they would fill one of the 3.35 million job openings there were in September. What he fails to mention is that with 14 million unemployed workers, there are 4.2 unemployed workers for every job opening. That ratio, as the chart below illustrates, is abnormally high.
Markowitz also makes an error that I’m starting to see more and more. He assumes it’s abnormal for there to be unfilled job openings in the month of September as measured by the Job Openings and Labor Turnover Survey (JOLTS).
Employers do not fill job openings instantly, nor do they necessarily fill them within 30 days. In other words, the JOLTS will never report there were zero unfilled job openings in a month, and it is incorrect to assume that the levels reported each month imply that employers are on average having difficulty filling job openings.
It takes time for employers to choose who to hire even in a period of high unemployment. If employers were having widespread difficulty filling job openings, we would see wages rising rapidly and we are not seeing that.
- Jack Markowitz, Pittsburgh Tribune-Review — Jobless often don’t help selves, often have themselves to blame
An excellent data-based review of the struggles of today’s youth has been produced by Demos, in collaboration with Young Invincibles.
Your local paper will likely have some good news on jobs this morning as the Department of Labor and Industry released metropolitan area level data on the employment situation in October. For Pennsylvania, the October job numbers were good with unemployment falling and nonfarm payrolls rising. As you would expect, that pattern held true for most of Pennsylvania’s metropolitan areas in October.
Here are the stories I found. If I missed one, please let me know in the comments.
- Ann Belser, Pittsburgh Post-Gazette — Region shows solid job gains
- David Wenner, Patriot-News — Harrisburg area unemployment rate made sharp drop in October
- David Falchek, Times-Tribune — Unemployment drops to 9.2 percent, its lowest rate since June 2010
- John Guerrier, Erie Times — Unemployment rates drop for Erie, Crawford counties
- Walt Frank, Altoona Mirror — Area unemployment rates decrease
- Tim Mekeel, Intelligencer Journal — Lancaster County jobless rate falls: Unemployment dropped in all of Pennsylvania’s 67 counties, just the seventh time that’s happened since 1971
The Federal Reserve took action on the situation in Europe. Here are two excellent explanations of what happened and what it means.
- Heidi N. Moore, Marketplace Easy Street — Ben Bernanke In A Humvee: Why The Fed Bailed Out Europe
- Mark Thoma, CBS Money Watch — Will the Fed’s move to help Europe hurt the U.S.?
19 Comments
And not only that, but it’s always demand that forces employers to hire new workers. If they could meet all of their demand without ever hiring workers, they would.
And demand is always low in times of low unemployment, so there employers feel no pressure to fill vacancies in a hurry. Sometimes they’ll lose a worker, seek a replacement but not do so in rush, and then realize they’re meeting current demand even without that worker and just leave it vacant until demand picks up.
Those are very misleading numbers, and the fact Markowitz uses them this way proves he is a major asshole.
Doh, why can’t we have EDIT??
First sentence of third paragraph should be “And demand is always low in times of HIGH unemployment.”
Make sure when you read “good news” that the numbers are seasonally adjusted.
We knew that.
Heh. Whachu, sum kinna economiss or sumpin?
More of a gardener: I know green shoots when I see them. And these ain’t green shoots.
What do green shoots look like in December in the NE, seasonally adjusted?
I’ve run the seasonal adjustment program too often for words, but never on green shoots in December.
Mildly interesting examples. Teachers strikes always in August/September. Construction workers strikes in summer.
Who, other than a jerk like me, would think about seasonally adjusting strike data.
Also dates me, since there hasn’t been a big strike for decades.
I was responsible (no snark) for getting Institute for Supply Management to seasonally adjust their survey data on manufacturing.
Excellent article, but I would take issue with the statement “If employers were having widespread difficulty filling job openings, we would see wages rising rapidly and we are not seeing that.”
That’s how classical economics says the world works, but in real life, employers are extremely, extremely reluctant to raise wages, and landlords are just as extremely reluctant to drop rents, enough to bring things back into balance. They would rather see positions go unfilled and see their properties vacant, because they are too stubborn, proud, or arrogant to pay much more or collect much less.
Labor has no power to get wage gains until unemployment rate gets low enough to make employers bid workers away from each other. Empirically that is an unemployment rate around 4%.
I am not necessarily a sports fan or a violent person, but there are so many of these people whose heads would make great batting practice.
Once again, I’m forced to wonder if most pundits ever check historical trends in a number before they just assume they know what it means.
Good catch, Mark.
One company that laid me off, twice, has about 30 perpetual job openings. They are mostly executive positions that I think they just use to threaten their employees.
I think this is a very common practice, actually. Perhaps not always for the reason your company did, but if they’re any size they might want to hold out for an ideal employee they can put into a place they feel they really need him, maybe for marketing or product development. Several of the companies I worked with tried to do that, and they were supposed to be on a fixed budget.
Which is why the “unemployment is structural” crowd has no interest in seeing that happen, EVER.
(Which was, possibly, implicit in your comment; I just wasn’t sure.)
Btw, bonus points for use of the word “scrofulous”. I don’t even know hwat it means, but it clearly merits them, anyway.
I have seen several news stories about the fact that among the age group sixteen to twenty five unemployment is at 53%.
This is a really high statistic.
I also think that for any newspaper anywhere to eve n exist, we should require they hire locally. I tried to call the newsroom of a local newspaper today – the old newsroom number is now answered by someone in a third world country who asked if I wanted to pay for my subscription with Master Card or Visa.
How can people have work if even small local newspapers are outsourcing the old subscription desk jobs!?! And these same people have editors who write editorial after editorial about how the folks at Occupy! should just go out and get a job.
Seems to me whoever issued the retired editor a diploma should sue to get it back.
Just more propoganda pushing the meme that anyone who is unemployed these days is just a lazy slacker who wants a hand-out. Nothing to do with reality, but it certainly comforts a lot of citizens who are lucky enough to have jobs, etc, and makes it easier to not question reality all around them.
Oh? OWS is filled with lazy creeps who don’t want to work? And All is Well otherwise?? Great! Pass the beer & the clicker. Let’s watch some crap on tv.
Typical. I see Editorials like this all the d*mn time. It’s a desired and sought after *feature,* not a bug.
If it can become a “job Americans won’t do” they’ll never have to raise wages.