The Wall Street Journal has an interesting report on the jobs created since the recession.
The article takes a close look at employment and wage data to see the makeup of newly created jobs.
There are some flaws and data inaccuracies in the journal report. Nonetheless it is an excellent starting point for discussion.
Please consider Just How Good (or Bad) Are All the Jobs Added to the Economy Since the Recession?
One refrain we hear often from readers of Real Time Economics is that the majority of jobs employers are creating are — in their words — not good, part time, temporary or seasonal minimum-wage positions offering scant benefits, mostly in the service sector.
“Nobody could live on just one of these jobs,” J. Thomas Gaffney wrote in a Facebook comment in March. “It’s not the quantity of jobs that matters, it’s the quality, and these jobs are not quality jobs that pay a living wage or provide decent benefits.”
Mr. Gaffney’s comments, and others like it, pose a difficult question: How do you measure the quality of all the jobs the U.S. added and lost in a given month?
The top line figure from the employment report masks all sorts of variation. Millions of Americans quit or are laid off each month, while millions are hired to new jobs.
The journal provides a snapshot of job sectors ans also lists 117 job categories and provides a nice spreadsheet one can sort on numerous ways.
Job Snapshot
The problem with the snapshot is it gives more weight to growth rather than the actual size of the growth or contraction.
Find Your Industry
The Journal has a very nice “Find Your Industry” sortable list of 117 job categories. In the list I found at least one of data error.
I also caution about overlapping job categories. Here is a section of the table I produced, sorted by size of industry, not size of growth.
I added the last two columns.
| Category | Percetange Change | Average Weekly Pay | Employees April 2016 | Employees April 2007 | Employment Change |
|---|---|---|---|---|---|
| Leisure and hospitality | 14.10% | $383.41 | 15,459,000 | 13,375,000 | 2,084,000 |
| Food services and drinking places | 16.90% | $338.69 | 11,308,300 | 9,552,000 | 1,756,300 |
| Local government education | -3.00% | Not available | 7,810,500 | ||
| Construction | -10.90% | $1077.02 | 6,670,000 | 7,686,000 | -1,016,000 |
| Local government, excluding education | -0.40% | Not available | 6,399,300 | ||
| Hospitals | 11.00% | $1133.33 | 5,065,400 | ||
| Specialty trade contractors | -10.70% | $1029.5 | 4,246,400 | 4,890,000 | -643,600 |
| Employment services | 5.30% | $615.6 | 3,597,300 | 3,286,000 | 311,300 |
| Educational services | 18.60% | Not available | 3,529,600 | ||
| Food and beverage stores | 8.10% | $439.5 | 3,096,500 | 2,834,800 | 261,700 |
| Membership associations and organizations | 0.50% | $813.58 | 2,967,200 | 2,962,200 | 5,000 |
| Durable goods*** | -5.40% | $1137.19 | 2,954,200 | 9,020,000 | -1,310,000 |
| State government, excluding education | -5.00% | Not available | 2,671,700 | ||
| Credit intermediation and related activities | -6.90% | $1131.9 | 2,598,400 | 2,892,500 | -294,100 |
| Insurance carriers and related activities | 7.80% | $1328.57 | 2,594,200 | 2,386,800 | 207,400 |
Data Errors, Overlaps, Missing Data
- For Durable Goods, I get 7,710,000 employees, not 2,954,200. That’s a huge decline of 1,310,000 high paying jobs. Decrease is per my calculation. April 2016 is the WSJ erroneous number.
- Food and Drinking Places is a subset of Leisure and Hospitality.
- Specialty Trade is a subset of Construction.
- I could not find a number for Hospitals other than totaling up 50 states so I did no further analysis. I have another problem with that category. It’s simply too broad.
- I ignored any job category that had no wage component.
Summation
- Weeding out the duplicates, I see an increase of 2,657,500 poor paying jobs.
- Weeding out the duplicates, I see a decline of 2,412,700 high paying (over $1,000 a week) jobs. I added 207,400 insurance jobs to this total.
- I am reluctant to do anything with hospitals because I cannot find the numbers, and because the category is too broad. Averaging nurses and other employees without further breakdowns and knowing what is what is problematic.
My subset does not tell the full story either. On average, things are worse.
There are some high paying jobs added but also a slew of low paying jobs. For example, Computer Systems Design grew 39.2% to 1,975,300. That’s a high paying job at $1731.35.
But Individual and Family Services grew a whopping 51.5% to 2,192,100 jobs. That’s a poor paying job at $466.45 per week.
Other General Merchandise Stores employment grew 27.6% to 1,866,200 jobs. That category did not have an average weekly salary figure, but it’s safe to assume low.
Telecommunications, a high paying job shed 22.6% of the workforce to 797,800.
Management and Technical Consulting Services gained 34.3% to 1,334,100. That’s a high paying job at $1434.86 per week.
Sea of Red
Add it all up and there are some winners in a sea of red. There’s no way to spin this data positive, or even neutral.
Mike “Mish” Shedlock
Spot on Mish what I see daily where I live. Yet my yellowdog friends sit around and talk about how well Obama is doing with the recovery. Oh and now Hillary and yet I asked them why they would vote for a criminal that is above the law. I got some looks on that one and one of my yellowdog friends agreed with me. People toss out all good sense when they voted either Dem or Repub all their lives. I just do not get it myself but then when presented with real facts people will choose to ignore them.
Two of my friends write columns for the local newspaper and I just want to slap them for ignoring real facts and ignoring research to further their own agenda. At one time we had real reporters and columnists now I do not believe them anymore. Sad times indeed when critical thinking is tossed aside even when your slapped in the face with the local facts.
The good thing is I am still invited to the table and it is fun joisting with die hard left and right wingers. Some even called Trump the devil while others call Hillary the anointed one!!
You say “local” paper. You may want to check out their ownership.
I was just using the term “local” paper in my thinking today. However, I reminded myself that the “local” rag has been owned for years and years by a large, international conglomerate. (I’ve known for some time now.)
So unless your town is very very small, your “local” paper is most likely owned also by a large, globalist firm. Even the still “locally” owned papers get the overwhelming majority of their “news” items from some international press agency. That is true also for local television affiliates. Haven’t you ever wondered why your loco TV station was showing a ordinary house fire 7 states away or reporting that a cat had kittens in North Korea?
Those globalist firms’ reporting definitely is not for the best interest of the local people. Guess who their “reporting” is in the best interest?
So to summarize:
obama has added more to the national debt than every other president combined and accounting for inflation.
And all we got were some bartender and waitress jobs
Trump has the perfect job for Obama after his “Presidency”… Ambassador to Lybia.
I thought he was saving that assignment for H. Rotten Clinton.
CJ
She’s on the “replacement” list… they are going to need a whole bunch after Obama “vacates”.
“I thought he was saving that assignment for H. Rotten Clinton.”
Assuming she isn’t UNJUSTLY cleared as I suspect she will be in some way that would subject her to double jeopardy if he did so, I’d hope he’d have a federal prison cell reserved for her, a place she’d already be if she was just one of us peons.
Trump is going to offer Hillary a job modeling orange jumpsuits.
What baffles me is why it is SO hard for the software companies I work for to find experienced software engineers. Every single company I have worked at in the last 20 years has struggled to find quality software engineering applicants even when offering compensation well over the $100,000 range. Sadly, most of the qualified replies I get for my job posts are from people living abroad who want to move to the US. I am seeing this play out right this minute with job postings I have made.
Interestingly, most of the US citizens who apply to my job postings are just starting out in their careers. I get a lot of veterans undergoing mid-life career changes applying for work.
For whatever reason, most (but not all) of the Americans who apply for my openings have way less relevant experience in the specific technologies we use than the foreign applicants.
I’m curious; could it have anything to do with job location, or the ability of American workers to move?
Foreigners have been doing “OUR” work for years now, hence, that’s where the experience comes from?
Maybe the issue is that only a fixed percentage of people are either interested in, or have the intellectual capacity, for these software engineering jobs. It could be that all Americans who fit this bill are ALREADY gainfully employed as software engineers. In which case it would make sense that the largest pool of NEW programmers to draw on would be people outside the country who want to earn more money than they can make where they are.
If this hypothesis is true, then perhaps the key thing driving growing under-employment is the fact that many people simply aren’t suited to the high paying jobs that exist and will therefore be forced to take lower paying jobs as the economy re-structures and more things are automated.
As an engineering contractor, I’ve seen how many companies.operate. The common theme I find is project management lacks technical skills to guide the engineers to successful product release. My guess is a prospective experienced engineer will notice the lack of technical skill in the interview team and seek employment elsewhere.
Right now I’m dealing with a systems engineering department manager who does not know some basic facts necessary to do his job, AND he has nobody in his department with electrical engineering experience despite the product being controlled by advanced electronics. Another manager at another company 10 years ago told me to have an electronic board built even though simulations clear showed it would not work. The board was dead on arrival. And a manager at a global medical equipment company ignored my analysis that the product being developed had a major design flaw. I was told, “It’s not in our schedule to fix it.” 6 months later the prototype crashed due to the flaw I had predicted. The cancelled project resulted in more than $200M down the drain.
I will admit I make mistakes; however, when I realize I’ve made a mistake, I FIX IT!!!
Fix this. $200M when I was in school represented 200,000 as we used the Roman numeral for 1,000 which is M. Nowadays I see people using the metric K in it’s place while misusing M for million. Not sure if you view this as a mistake but it certainly can cause intergenerational confusion.
Have you considered that perhaps the assumption that there should be millions of great software engineers is a bad one? Good developers are artists, not just engineers. They know how to understand the requirements given to them, ask questions, and design elegant solutions. This is the type of talent that I would not expect to be common. To me it is the same thing as someone saying “why can’t my record label find more groups like the Beatles?”. Innovative, creative, and unique talent is uncommon. So, assuming that good developers should be numerous is flawed. And bringing in Indians and Chinese workers is not the answer. Excellent talent is no more common there than it is here. Perhaps the answer, or the problem is that the underlying “infrastructure” is not evolved enough to support the demands of the industry. Meaning, perhaps the tools and processes underlying the creation of technology solutions/products are not evolved enough to allow average developers to produce effective output. Rather than raise the bar for the talent required, we need to improve the tools and processes used by industry, much like going from skilled hands on craftsman, to machine based production.
You may be right about the finite pool of talented software engineering artisans. Still, I am finding it much easier to find these artisans in other countries than in the US. I suspect it’s not that there are more Asian software engineers on a per capita basis, but the wage differentials provide a huge incentive for these talented people around the world to come to America.
What can absolutely be said is that the Indian or Chinese engineers I hire are NOT taking away jobs from Americans. I just don’t get very many qualified American applicants in the first place.
One other observation… I notice that a lot of the truly talented American software engineers go off and start their own businesses. That’s not as common for software engineers from other countries who are more content working for someone else.
Now that I find interesting; and even encouraging in some ways. While hardly being in the same league as regards schooling, someone up the block from me remarked he would never go back to being a hired hand now that he has his own window installation business. The greater the talent (at whatever) the greater the entrepreneurial spirit perhaps?
Econoday has consensus for April retail sales ex gas ex autos at +0.4%
Actual retail results so far don’t belie that optimism.
thomson reuters has same store sales (year over year) @ +0.1%
http://lipperalpha.financial.thomsonreuters.com/2016/05/retailers-miss-easy-april-sss-comparisons/
but that before Macy’s reported (a big miss) … Q1 for most retailers ends end of April.
“Sales in the first quarter of 2016 totaled $5.771 billion, a decrease of 7.4 percent, compared with
sales of $6.232 billion in the same period last year. The year-over-year decline in total sales reflects, in part, the 41 stores closed in 2015. Comparable sales on an owned plus licensed basis were down by 5.6 percent in the first quarter. On an owned basis, first quarter comparable sales declined by 6.1 percent”
and an even bigger miss for The Gap (april sales)
expected sss … +0.5%
actual sss … -7.0%
http://www.gapinc.com/content/gapinc/html/media/pressrelease/2016/med_pr_gps_q12016.html
[q]Summation
Weeding out the duplicates, I see an increase of 2,657,500 poor paying jobs.
Weeding out the duplicates, I see a decline of 2,412,700 high paying (over $1,000 a month) jobs. I added 207,400 insurance jobs to this total.[/q]
Mish – That should be “over $1,000 a week”, no?
yes – fixed
How good are the employees the unions are creating?
Atlanta Fed now up to 2.2% for Q2. No mention on your blog? Thought the recession started in Q4 2015? I guess the Atlanta Fed is part of the conspiracy now? Weird because last month you were really fond of them…
I really do not have time to comment on every story. And I am not one sided. Countless times I have reported when data was better than expected. Much of the time it was revised away. There were a number of reports out that day, and I actually did not even see it until late in the day. I believe the NY Fed is still at 0.8%. Had I reported late in the day I would have shown both and asked “Which one is right?”
Indeed, Mish does comment when the data is better than expected as well as worse. He is very unbiased in that regard.
As for this story, the fact that the jobs being added are low quality jobs explains the demand for the $15 minimum wage. If high quality jobs were being added, no one would be suggesting that since they would already be getting $15. Note, however that if the $15 minimum wage is enacted, the primary area where we’ll see the most job contraction is precisely in the sectors where jobs have been added.
So?
GDPNow was higher for Q1 back in February than it is now for Q2
How did that turn out?
And are you oblivious to the macro revisions which have been heavily weighted to the down side?
It’s all done with smoke and mirrors. “Pay no attention to that man behind the curtain”!
https://d.ibtimes.co.uk/en/full/265843/francois-hollande.jpg?w=630
Sure, the economy is “booming”.
How about we put a little test on it and raise interest rates say 25 basis points? Right…
Yes, I don’t think so.
Full faith and confidence used to infer that there was something to be faithful and confident ABOUT or IN. Now faith and confidence are a ploy, a game driven by manipulated numbers and propaganda coming from the likes of the various Fed mouthpieces.
True growth and prosperity is like pornography….we know it when we see it, and we AIN’T seeing it!
https://www.youtube.com/watch?v=3Px6KX75jM8
(Courtesy Huky)
Worst expansion ever! Even professional jobs are not providing enough mental stimulation thru progress of business into new services.
This low-paying job nonsense seems the logical result of government laws and regulations, and the general propensity of government at all levels to micro-manage businesses and the economy. Higher paying jobs are often supervisory and managerial, which presupposes larger workforces. But with Obamacare and all the other taxes and regulations, including minimum wage mandates waiting in the wings, those larger workforces that are not of the crony capitalist variety will head to where money and business are, if not loved, at least treated friendly and with respect. Make it onerous to run businesses above, say 50 people, and fewer of these businesses will form; and therefore less need for highly paid supervisory and management personnel. You reap what you sow.
Really, micro-management of the USA economy is not much different than the EU approach to Turkey, the Colonialist/Imperialist approach where they treat the Turkish leader like an errant child instead of giving him the money and then waiting until afterwards to judge the results. Very parental and authoritarian, and businesses are right to reject it instead of creating potential headaches and money losses by hiring that 51st employee. Same as Erdogan is right in rejecting EU attempts at running Turkey (quite apart from whether Erdogan or Merkel is the Devil; though it is interesting that now Merkel is now de facto EU ruler). Turkey seems to be doing a good job running refugee camps without the EU, just as USA small businesses can do without more government regulation and mandates. Same principle and mindset.
As to software engineers, offshoring or hiring workers in other countries is the only alternative if the workers cannot be brought into the USA. Plus cheaper wages abroad where the cost of living is less. The big computer companies already do this out of necessity, unable to get visas for those new grads they wish to hire. Let China, Vietnam, Mexico etc. keep the manufacturing, and take the shackles off of developing new replacement industries outside of government-funded and controlled industries (e.g. education, health). The solution at home and abroad is not more government, but less intervention and micro-management.
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Well, it’s true there ARE actual “job openings” out there, but…
There are a LOT of openings for various idiosyncratic types of “technician”, “fully trained & ticketed” millwrights, specialized pipefitters, computer IT personnel with THE LATEST training, surveyors/helicopter mechanics and “journeyman welders with management experience” and stuff like THAT…
These are the kind of “big employers” governments like to survey. Easy & neat, and fits the agenda.
But there are not many REAL entry-level jobs in which employers are flexible, reasonable, willing to train and willing to DO THE LEGWORK to find, interview and hire an untrained but promising person. That’s because the real, non-government-dependent private sector Main Street small employer is dead in the water.
EVERYONE wants “someone for nothing”…especially lazy employers.