Yesterday the monthly jobless report showed a larger loss of jobs in June than expected. There is one point that should be emphasized and that is US needs to create about 120,000 jobs a month to just break even due to population increases and new workers, like college grads, entering the workforce. So when to see yesterday’s monthly job loss of 467,000, remember to add to that the 120,000 jobs that weren’t created.
Here’s a take from the monthly jobless report that finally paints a picture of reality. As quoted below: “There’s nothing in here to show that the economy and the market are pulling out of the grip of recession.”
The American economy lost 467,000 more jobs in June, and the unemployment rate edged up to 9.5 percent in a sobering indication that the longest recession since the 1930s had yet to release its hold.
“The numbers are indicative of a continued, very severe recession,” said Stuart G. Hoffman, chief economist at PNC Financial Services in Pittsburgh. “There’s nothing in here to show that the economy and the market are pulling out of the grip of recession.”
via Jobless Rate Climbs to 9.5%, Deflating Recovery Hopes – NYTimes.com.
That sentiment has been lacking in the “US: recession yes/no debate for the past six months, especially in the main stream media, which has pumped the “green shoots” mantra since the stimulus debacle. Why is that statement accurate? Here are a few reasons why the stimulus wasn’t stimulating to most of us, but was very stimulating to the banks and the other crooks that created this financial mess:
The stimulus was pushed as a job creation machine for the masses, yet it has showed that this is so far not the case. Why hasn’t the American Recovery and Reinvestment Act of 2009 been a job creator? I think it’s because the majority of those funds went to tax breaks and businesses that have no intention of hiring more people. As an example, why would a road construction firm hire more people to build roads when states and municipalities are cutting back on their funding for road work? The feds may have prevented further layoffs at these firms, but it isn’t likey to create tens of thousands of more jobs.
Even trimmed to $789 billion, the recovery measure, signed by President Obama on Feb. 17, will be the most expansive unleashing of the government’s fiscal firepower in the face of a recession since World War II. And yet it seemed almost trifling compared with the $2.5 trillion rescue plan for the financial system – a combination of loans to banks and incentives to bring private capital into the banking system – announced on Tuesday by Treasury Secretary Timothy F. Geithner.
Take a close look at the above paragraph and I’ll go over the numbers. My simple take is that the total funds pumped into the system by the fed are about $3.3 trillion dollars. I think that’s a conservative estimate, since some have determined that the total amount of money the feds have pumped into bank bailouts and stimulus is approaching $14 trillion. But I’ll take the conservative approach and use the $3.3 trillion figure mentioned above. So instead of the $789 billion in stimulus funds and the $2.5 trillion sent to bank crooks, your elected leaders in congress could have decided to send each of America’s 110,000,000 households a check for $30,000. I’m not sure about you, but wouldn’t a check for $30,000 be more stimulating than a promise of some sort of economic recovery would occur based on giving banking thieves and large companies trillions of dollars? You and I could have decided to stimulate the economy by spending some of that $30,000 on what we thought was important. The feds could have sent each household $30,000 in gift cards and demanded we spend the money over a two year period. But no, they decided to give the cash to the like of Goldman Sachs and other banking giants that caused our dire financial condition. Oh, and because of the taxpayers largess to these bank frauds, Goldman Sachs is distributing record bonuses this year:
Staff at Goldman Sachs staff can look forward to the biggest bonus payouts in the firm’s 140-year history after a spectacular first half of the year, sparking concern that the big investment banks which survived the credit crunch will derail financial regulation reforms.
A lack of competition and a surge in revenues from trading foreign currency, bonds and fixed-income products has sent profits at Goldman Sachs soaring, according to insiders at the firm.
via Goldman Sachs to make record bonus payout | Business | The Observer .
In closing this rant, I want to give a few examples on how the rich got richer during this taxpayer givaway, while the person that needed the most help was discarded or given a tiny slice of pie to make them think that their concerns were being met:
- Unemployment benefits 1: The government estimates that there are 14.7 million unemployed people, but that is probably a conservative estimate. While the benefits period was extended in most states, there are states like Texas that refused the government extension funds. The recession officially started in December 2007, so anyone laid off from that date forward who has not found a job has likely exhausted the maximum 72 week unemployment benefit period. More people will be coming off the benefit rolls, not as a result of getting a job, but as a result of exhausting benefits. The negative fallout from that could start to have an affect on increased crime and even lower consumer demand, let alone mortgage and utilities payments.
- Unemployment benefits 2: The feds raised the maximum benefit by $25 in most cases, if the funds were approved by the states. There are still a number of states, like dysfunctional NY, that haven’t approved a new budget to allow for those extra funds to be distributed. As usual, our elected leaders are more concerned about showmanship and grandstanding than performing their duties effectively.
- Unemployment benefits 3: These benefits are taxed as income. Why didn’t the feds just eliminate the income tax portion of unemployment benefits instead of raising the payment $25? The $25 payment increase had to be approved by the states, but the elimination of the income tax from unemployment benefits would have happened immediately without state intervention. And that extra $25 a week given to the unemployed is taxable, so the true amount received in most cases will be less than $25. Banks, insurance companies and other corrupt businesses are now allowed to give their employees record bonuses, but the unemployed are still being asked to pay taxes on some meager benefits.
- State budgets: States were given stimulus funds for a number of purposes, but they still need to balance their budgets and most of that balancing has to be done shortly. States and other entities will have to cut jobs to meet lowered property and sales tax receipts. Those job cuts include the ranks of social services, which are more needed during a recession, but are hacked at an alarming rate during troubled times. Child care, transportation, welfare, utility payment and other subsidies (Domestic Violence Shelter Lay Offs) are cut further when needed most. So the poor suffer while the boys and girls at Goldman and other investment houses live lavishly from bonuses orchestrated by taxpayer bailouts.
Those are only a few examples of the twisted logic of the bailouts and how they helped the rich stay rich at the expense of the needy, poor and middle class. I’ll add to this list as time allows, but I hope this makes a point of how the system has been so corrputed by bad money and bad politicians that it no longer can effectively meet the needs of those who need help most.
Please send along your thoughts.
Onto today’s news.
– Larger layoff announcements and important economic reports:
Tom Toles
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Microsoft/Google/IBM and other Rumors/News
General Economic News
Government Layoff News
US and some Canada Layoff News
International Layoff News
Hiring News and News You Can Use
– Microsoft/Google/IBM and other Rumors & News –
– Tom Silver, senior vice president of Dice.com, told us this morning that Dice.com is reporting a 44% year-over-year drop in job listings for the month of June. May’s year-over-year decline hovered around 45%.
– SPRINGFIELD – The state budget mess is starting to be felt here at home.
The Sojourn Domestic Violence Shelter in Springfield was forced to lay off eight workers Wednesday and is now
via Domestic Violence Shelter Lay Offs.
Chris Britt
– US and some Canada Layoff News –
– MICHIGAN CITY – Sullair Corp., 3700 E. Michigan Blvd., laid off 50 workers on Tuesday as the economic downtown has continued to shrink market demand for air compressors.
via 50 more laid off at Sullair.
– The Faculty of Arts and Sciences has eliminated 77 staff positions and reduced work hours for another 15 employees as part of the recent University-wide downsizing, Dean Michael D. Smith announced Wednesday.
via The Harvard Crimson :: News :: FAS Lays Off 77 Staffers .
-NEW BRIGHTON — New Brighton-based Tegrant Corp., formerly Tuscarora Inc., has laid off a dozen management employees as part of a company consolidation.
via Beaver County Times & Allegheny Times Online – Top Stories.
– Fort Lauderdale, Fla.-based Ruden McClosky has laid off eight more attorneys as part of a cost-reduction effort that included 18 percent pay cuts for most of its lawyers, according to firm and other legal industry sources.
via Law.com – Ruden McClosky Slashes Pay, Lays Off 8 Lawyers .
– IOWA CITY, Iowa (AP) — Iowa Public Radio has bought out, laid off or reassigned five employees and will leave four other positions unfilled in an effort to cut costs.
via Iowa Public Radio announces job cuts, cites revenue dropoff from state and universities – WQAD.
– In a memo distributed to employees Thursday, Cincinnati Enquirer Publisher Margaret Buchanan wrote that the newspaper will lay off up to 100 people in the next few days. The Gannett Co., The Enquirer’s parent firm, is bracing for about 1,400 layoffs in its newspaper division before July 9. Buchanan’s memo is the first indication about how the cutbacks will affect Cincinnati’s only remaining daily newspaper.
– 11,000 mail deliverers and sorters will be made redundant at TNT Post, the Netherlands’ former national postal service announced in its staff magazine on Thursday. The company, which is struggling with new competition and high wages, says a reorganisation is unavoidable after the unions turned down a deal to cut pay instead of jobs.
– Engineering group Siemens (SIEGn.DE) will cut the 900 jobs at its Prague rail car factory in August, a spokesman said on Thursday, the latest jobs loss as central European industry struggles to gain orders.
– Anglesey Aluminium is offering 140 staff voluntary redundancy because a new power deal that gives them cheap electricity has not been reached.
via BBC NEWS | UK | Wales | North West Wales | 140 redundancies at metal plant.
– UP to 1,000 staff on short-time temporary contracts of less than a year are to be let go by the HSE. The move will allow the creation of the same number of permanent posts to improve a range of services including child psychiatry and care of the elderly.
via 1,000 HSE temporary staff laid off as new jobs filled – National News, Frontpage – Independent.ie.
– Hiring News and News You Can Use–
– COLUMBUS, Ind. (AP) — Cummins Inc. is recalling 400 laid-off workers as it resumes production of the Dodge Ram engine at a central Indiana factory.
http://alphainventions.com/ for a look at websites from around the globe.
Tags: cut jobs, economic, employment, factory closing, firing, hiring, job loss, jobs cut, laid off, layoffs, plant closing, positions eliminated, redundancies, staff cuts, unemployment, workforce reduction
