Inquiring minds who notice the alleged drop in the unemployment are asking “Where the hell are the jobs?”
It’s a good question. And I have details, by demographic age group, from reader Tim Wallace.
click on any chart for sharper image
Change in Number of Jobs Since 2007
Civilian Non-Institutional Population by Age Group
Work Force by Age Group
Number Employed by Age Group
Percent of Population Group in Work Force
Percentage in Age Group Employed
Tim Wallace writes …
In the 16-19 age group, the population has shrunk by 239,000, while the number of jobs in this age group has shrunk by 1,415,000!
In the 20-24 age group, the population has grown by 1,625,000 while the number of jobs has shrunk by 362,000. So, for the under 25 age group we have 1,777,000 less jobs with 1,386,000 more people.
In the 25 to 54 age group that everyone focuses on, we see a loss in population of 1,382,000 people since August of 2007, but an even greater loss in jobs – 5,940,000!
Since we know that the population has grown by over 13,000,000 since 2007 yet we have 1.8 million less jobs since then, what does this tell us?
Jobs were lost in every age bracket but the 55+ group, with 16-19 dropping 22.6%, 20-24 falling 2.6%, 25-54 going down 5.9% and 55+ going up 22.7%.
The second graph shows the Civilian Non-institutional Population by age – note the basic flat lines on all but 55+. The graph shows the Work Force by age – note once again only 55+ goes up.
The fourth graph shows the number employed by age group. Note that it’s only the 55+ age group that has done anything in the current “Recovery”. The other groups are all down from 2007, with 16-19 devastated. Just go in Walmart and McDonald’s and you will see it first hand – senior citizen workers abound.
The fifth graph shows the percentage of an age group that is also in the work force. Note the plunges in every age group except 55+.
The last graph shows the percentage of the age group employed. It follows the exact trend of the fifth, as it must.
So, if you are in sales and marketing you should be focusing your products on the 55+ age group, they are the ones earning the cash. Forget the teenagers, they are contributing little, and their parents are sliding fast! The millennials aged 20-24 hope those 55+ will retire but the trends do not look promising.
As typical with my charts, data is not adjusted for seasonality. Instead, I compare the same month every year to prior years.
Structural Demographics Poor
Flashback May 22, 2008: In Demographics Of Jobless Claims I wrote …
Structural demographic effects imply that prospects in the full-time labor market will be poor for those over age 50-55 and workers under age 30.
Teen and college-age employment could suffer a great deal from (1) a dramatic slowdown in discretionary spending and (2) part-time Boomer reentrants into the low-paying service sector; workers who will be competing with younger workers.
Ironically, older part-time workers remaining in or reentering the labor force will be cheaper to hire in many cases than younger workers. The reason is Boomers 65 and older will be covered by Medicare (as long as it lasts) and will not require as many benefits as will younger workers, especially those with families.
In effect, Boomers will be competing with their children and grandchildren for jobs that in many cases do not pay living wages.
So, where are the jobs?
They went exactly where I said they would: Boomers now compete with their children and grandchildren for jobs that do not pay living wages.
I certainly did not envision the “Obamacare effect” in 2008, but the trend was already set in stone due to rising health-care costs and the age 65 kick-in of Medicare.
Obamacare enhanced the trend I had already expected.
Who is to Blame?
Don’t blame corporations or minimum wage laws. Blame the Fed, central bankers, fractional reserve lending, and Congressional silliness including Obamacare.
For further discussion, please see …
Mike “Mish” Shedlock