
Millions of educated, experienced workers are tossed aside by a strong economy - notlob
https://www.washingtonpost.com/business/2018/07/23/millions-educated-experienced-workers-have-been-tossed-aside-by-strong-economy
======
prolikewh0a
I keep hearing that we're in a strong economy, but the reality is that we
aren't. It's a strong economy for the rich and powerful, but not really anyone
else.

Most American's can't afford a $1000 emergency [1].

Wages actually went down last month [2]

78% of Americans are living Paycheck to Paycheck. [3]

Nearly half of all Americans are low-income or in poverty. [4]

1/5 of children in USA are living in poverty [5]

I want someone to explain to me how this is a "good economy". I keep hearing
it. It's total nonsense. I'm glad WaPo is bringing up that workers are still
struggling despite these claims of a "strong economy".

[1] [https://www.huffingtonpost.com/entry/most-americans-cant-
aff...](https://www.huffingtonpost.com/entry/most-americans-cant-afford-to-
pay-for-even-a-minor-emergency_us_5a68e67ae4b0022830090e5b)

[2]
[https://www.washingtonpost.com/news/wonk/wp/2018/06/15/for-t...](https://www.washingtonpost.com/news/wonk/wp/2018/06/15/for-
the-biggest-group-of-american-workers-wages-arent-just-flat-theyre-
falling/?utm_term=.0afbedc4d098)

[3] [https://www.cnbc.com/2017/08/24/most-americans-live-
paycheck...](https://www.cnbc.com/2017/08/24/most-americans-live-paycheck-to-
paycheck.html)

[4] [https://kairoscenter.org/wp-
content/uploads/2017/02/Poverty-...](https://kairoscenter.org/wp-
content/uploads/2017/02/Poverty-Fact-sheet-Jan-2017.pdf)

[5]
[http://www.nccp.org/topics/childpoverty.html](http://www.nccp.org/topics/childpoverty.html)

~~~
CompelTechnic
Many of the facts you stated are relatively invariant to the strength of the
economy. I do not have good sources to describe how they have changed over
time, but I would assume that points 1,3,4, and 5 are true nearly all the
time. Additionally, for point 2, real wages going down on a timespan of 1 year
is essentially noise in the face of rising real wages by various measures by
FRED.

[https://fred.stlouisfed.org/tags/series?t=real%3Bwages](https://fred.stlouisfed.org/tags/series?t=real%3Bwages)

~~~
wiz21c
If it's invariant then I find it even more disturbing.

~~~
CompelTechnic
A lot of these facts are designed to make scary headlines.

#1 and #3 are both symptoms of a common cause- essentially zero savings rate
for a wide swath of the American population. For the large fraction of people,
failing to save is a behavioral phenomenon. For many people, doubling their
income would still result in them living paycheck to paycheck.

For #5, 17% of canadian children are living in poverty, 1 in 5 French children
live in poverty, and poverty affects more than one in four children in the UK
today ([https://globalnews.ca/news/3739960/canadian-census-
children-...](https://globalnews.ca/news/3739960/canadian-census-children-
poverty/)) ([http://www.france24.com/en/20150609-unicef-report-france-
chi...](http://www.france24.com/en/20150609-unicef-report-france-child-
poverty-economic-crisis-education)) ([http://www.cpag.org.uk/content/child-
poverty-facts-and-figur...](http://www.cpag.org.uk/content/child-poverty-
facts-and-figures)). Of course, each country sets its own poverty line to
represent a socially-empathetic income level, resulting in pretty-even levels
of nominal poverty across countries. It is not that surprising that expanding
the scope of headline-worthy impoverishness to be "low-income or in poverty"
would result in headline #4.

------
bargl
The economy and the education system are out of sync. We are turning out a TON
of degrees for a few jobs and expecting people to be able to just succeed
based on a 4 year degree program. All the while the economy does expect a 4
year degree for some jobs that really shouldn't. So you're expected to waste
money on a degree you don't need to work a job that won't help you pay back
your degree because they aren't paying you what you need to pay off that debt.

I don't have a solution. I just see that I know plenty of people who have
GREAT degrees, are very intelligent and are working in a field where their
success is more defined by who they are then how they were educated. I think
whatever solution we do have, needs to take a look at both the economy as well
as the education system and how we prepare our young for a life in the
workforce. Because at the end of the day that's what we're doing, we're
educating our young to be able to step into our economy and profit.

Again, I don't know the solution. Regulate the number of graduates within a
certain degree field? Regulate jobs so that we force jobs to accomodate the
degrees? Unionize alternate jobs so working at walmart / factories becomes
profitable again? I don't know I just worry about what my children will do
when they enter the economy and how will they stay in the middle class.

~~~
moduspol
> Again, I don't know the solution. Regulate the number of graduates within a
> certain degree field?

Stop providing loan guarantees for all students regardless of the
marketability of the degree they've chosen?

~~~
LanceH
And make loans dischargeable like any other loan.

~~~
orthecreedence
Exactly. If the burden of collecting the debt is on the loaner, they will do a
better job of enforcing who gets a loan (which is traditionally the job of the
loaner anyway). Student loans get handed out like candy and now we have a
continuously-compounding problem of growing tuitions and debt.

If bankruptcy could fix student loans, then the ones giving out loans would be
a lot more careful, schools would stop wasting hundreds of millions on new
buildings that that are 80% empty, and we wouldn't have a large segment of the
middle class population in indentured servitude.

Seems pretty simple to me.

------
pastor_elm
>"She once had her own office, secretaries and assistants, along with titles
like “director” that spoke to her decades of experience. Now, she’s a temp —
one of many.

>Levi was laid off from her job at a law office during a merger in early 2015,
and has struggled to find long-term work. In late 2016, she filed for
bankruptcy."

How do you go from director at 59 to filing bankruptcy in fewer than two year
after losing your job? Fiscal irresponsibility

~~~
prolikewh0a
>How do you go from director at 59 to filing bankruptcy in fewer than two year
after losing your job? Fiscal irresponsibility

This is a very entitled and selfish statement. The act of simply existing is
very expensive in the USA, and if you have children or have unexpected medical
bills that can be tens of thousands or even hundreds of thousands, you can
easily eat through all of your savings very quickly and not be able to pay
back debts I'm sure they could pay before they were laid off.

~~~
tonyedgecombe
_This is a very entitled and selfish statement._

It doesn't take a huge imagination to realise the unexpected could happen,
especially at that age. If you have had a reasonable career in a well paying
job then it is irresponsible not to put something away for a rainy day.

~~~
citizenkeen
In the United States, a bad medical problem can cost five-to-ten years'
salary. That's one hell of a rainy day fund.

[https://www.cnbc.com/id/100840148](https://www.cnbc.com/id/100840148)

~~~
tonyedgecombe
The article didn't mention a bad medical problem, rather some low level
issues.

I'm not sure using the lack of socialised health care as an excuse for not
managing your finances is sensible. It's only a minority that need expensive
health care before 65 but it seems it's the majority who aren't managing to
live within their means.

------
bambataa
The waste of human potential is staggering. The purpose of the economy should
be to enable making full use of it. Instead we focus on profit.

~~~
jblow
You have to work out a system, then, to figure out who pays to employ the
people doing unprofitable work. Not as easy as it sounds.

~~~
makecheck
Lots of things are _profitable_ but never _absurdly and increasingly
profitable_ , which is the trap we are now in.

There’s no credit given for having a tidy business with steady profit. Instead
you have to have “growth” and other this-quarter-must-be-better-than-last-
quarter-or-else crap that “investors” want.

~~~
nradov
What sort of credit are you looking for? There are millions of tidy small
businesses with steady profit. Just because you don't see newspaper articles
about them doesn't mean they don't exist. Look around.

Small businesses are often able to get credit in the form of bank loans once
they have established a track record of profitability.

------
fullshark
The recession was a market correction not just for housing prices but also for
labor prices, and a lot of educated/experienced workers have learned that the
market doesn't value their skills like they thought they did.

------
NTDF9
What is paradoxical is that American voters keep voting to reduce taxes for
the rich, who don't do anything with that saved money to increase businesses.

Taxes should be lower for the poor who would thus spend more and keep the
economic engine running and create jobs.

Taxes should be much higher for the rich so that that money is used by Govt to
do infrastructure work (create jobs) or pay down debt (and thus provide
services and create jobs).

Lowering taxes for the rich just allows the rich to seek investments that will
increase their own wealth, not necessary creating jobs (Some VCs are an
abberation to this).

~~~
nitwit005
They keep electing people who reduce taxes for the rich. If it was up for a
direct vote, I doubt most of these tax bills would pass. The last one was
deeply unpopular with the public.

Some of it's just failings of a two party system. You vote for the one you
like better, but given a binary choice it's a fairly non-specific vote.

~~~
NTDF9
I think this a great opportunity for someone to make a real time
"consequences" website.

Whatever the candidate says, fact check it and display a few important impacts
to people directly. Economic is the easiest. Another good one is jobs, taxes,
quality of life, debt, inequality.

------
Karishma1234
I am having hard time understanding the problem articulated in this article.
Can someone with English as first language summarise the actual technical
arguments ?

For example I see that there is one graph with part-time, full-time graph. The
full time employment has increased rapidly while the part-time graph remains
the same. How is that possible ? Also, sharing economy is a new thing where a
lot of people who would be "unemployed" in past are now doing part time work.
A lot of work can be done online today staying at home and hence more people
might have taken up part time work.

Another graph shows how part time and full time wages have grown and it claims
part-time wages have been stagnant. The graph does not show that.

\-- “I’m overqualified for these jobs, but they don’t think that I would be
happy to do them,” Corcoran said. “I’m not finding any interest in a 60-year-
old guy with gray hair and, honestly, kind of a limited shelf life.” \--

Aren't these people actually the perfect candidates for part time experimental
work positions where you could fire them easily ? (In almost all countries old
people have hard time finding new employment)

------
makecheck
Many “jobs” today won’t even cover cost of living in their areas, making
UNDER-employment a valid issue that is too easily ignored in statistics that
show lots of people “employed”.

Also, being forced to take on a massive amount of debt just to have a chance
to _get_ a certain job makes that job less valuable overall. A company can
still boot you out in less time than it takes to pay off debts so you’re
really trying to find _continued_ employment to justify an investment such as
having to move or obtaining a degree. And of course you might acquire new
debts while paying off the older ones.

These situations tie the hands of so many, and that’s not a “strong” economy.
If there’s no _truly_ disposable income, you’re essentially expecting people
to set aside their basic needs to raise your stock price.

------
lkrubner
This sums up in a nutshell the 40 year slide in Mens wages:

“ _When he first started working iron, Hartnett was making about $43.90 in
today’s dollars. On his last project, he made $16.93._ ”

------
adpirz
Why the U3 statistic for unemployment is far from telling the whole story:
[http://www.wolframalpha.com/input/?i=us+adult+population,+us...](http://www.wolframalpha.com/input/?i=us+adult+population,+us+labor+force+participation)

------
fierarul
I find it amazing how much US cares about employment rate. Then people start
talking about U3 vs U*. I know they mean something... they always come up.

What I'm curious about these statistics is: how do the statistics track the
self-employed?

Seems to me the gig-economy is not about part-time jobs but about part-time
self-employment.

So, if you are self-employed and you pay your taxes, from the government's
point of view you are OK. But that doesn't mean you are profitable or making a
living wage.

In IT, if you are 'benched' the employer pays you regardless. But a 'benched'
self-employed person is basically an unemployed that is burning through cash
paying taxes, health insurance, etc.

~~~
JumpCrisscross
> _that doesn 't mean you are profitable or making a living wage_

These statistics are tracked to a pedantic level of detail by the BLS. You can
get numbers of people by industry and zip code and earnings bucket and quarter
for most categories of self employment going back to the early 1980s.
Moreover, unemployment isn’t mean to measure if people are getting a liveable
wage. It measure if they’re getting any wage. The problem you cite is an
issue, but it would quickly resolve itself into unemployment as the cash
stores ran out.

~~~
fierarul
I wasn't thinking only about the self-employed (as in S-corp) but also LLC
owners that are employees at their own company and smaller
ventures/startups(?).

Indeed, at some point the money runs out and that will become actual
unemployment, but it will show up in statistics with a rather long delay or
not at all.

In the mean time, you have people doing literally nothing while on paper the
economy is overheating.

Of course, I'm sure it's a small percentage of the population... so probably
not very relevant.

~~~
VLM
"For consistencies sake" (or more likely, to make the numbers look better) the
stats have been compiled the same way for a century or more with criteria
relevant to an economy mostly employing unskilled manual laborers for factory
work and ag work. Because unskilled laborers can find a job if they want in
less than a year, they drop off the unemployement rolls after a year. Of
course its trivial if you have an esoteric degree and decades of experience to
end up in a situation where there are no skilled jobs in your field... at
all... regardless how "hot" the economy might be for other people with other
skills, and in a year it won't matter anyway as you drop off the list of
unemployed and onto NEET or similar status. That is the situation with almost
every person in the linked article, they have 2020 skills and experience, no
jobs exist for those skills, and they'll will only appear for a short time in
unemployment stats designed to track unskilled manual laborers working at a
Ford plant a century ago.

~~~
dragonwriter
The only problem with that rant is that the entire premise is false.
Unemployment _benefits_ have a time limit, but unemployment _statistics_ do
not (you only fall off of the headline unemployment statistic if you become
institutionalized or employed, stop actively looking for work, or die.)

~~~
TheCoelacanth
Even some of the people who stop actively looking for work are still tracked
in unemployment statistics, just not in the U3 rate that is usually reported
headlines. Discouraged and marginally attached workers who have stopped
looking for work because they don't think they will find a job but who would
like to work if they could find one are tracked in the U4 and U5 measures.

------
mnm1
That's because it's not a strong economy. Millions have stopped looking for
work and never started after the recession. Wages have stagnated even for
white collar jobs. Employers are unwilling to pay competitively. Millions like
the ones in the article are underemployed and underutilized. How the fuck is
that a strong economy?

~~~
sillyquiet
You know, I keep hearing the 'many stopped working during the recession' thing
bandied about like received wisdom, and have not seen any statistics to back
that up. Note: I am not saying it's not true, just that I personally haven't
seen any studies or reports to back up that fact. Have you a link? All the U6
(real) unemployment rate numbers I've seen indicate 'real' unemployment is
back to pre-recession numbers

~~~
Kalium
[https://data.bls.gov/timeseries/LNS11300000](https://data.bls.gov/timeseries/LNS11300000)

There's this. This doesn't exactly back up the claim - there are a lot of
reasons people might not be participating.

~~~
HarryHirsch
Especially this:
[https://fred.stlouisfed.org/series/LNU01300060](https://fred.stlouisfed.org/series/LNU01300060)

25-54 year Labor Paticipation Rate is those that you'd expect to be working
but aren't.

~~~
JumpCrisscross
The difference between the 25-54 and civilian participation rates are largely
attributable to retiring boomers. Participation rates depend heavily on
demographics. They matter for things like dependency ratios. But quoting them
without the context of a large generation retiring and increasing time spent
getting educated hides the full picture. That said, the 3 percentage point
drop in 25-54 participation is largely attributable to the opioid
crisis—that’s a disturbing start to a trend.

------
golergka
> And once we knew where to look, we found their stories hiding in plain
> sight, in the Labor Department’s data.

In other words, you began your research with conclusion already in mind, and
then looked for a way to present this data to show this conclusion.

Excellent statistical work. That's exactly how such research should be done.

------
notadoc
From an employer standpoint, educated and experienced = expensive

~~~
Brockenstein
And everyone is looking for a deal. And sometimes people have to be burned by
going cheap. Although sometimes they do get lucky and get someone decent for a
pittance.

------
hypertexthero
It is time for Universal Basic Income.

[https://www.yang2020.com/](https://www.yang2020.com/)

~~~
mrlatinos
That's always the easy answer, isn't it?

~~~
AnimalMuppet
Until you have to find enough money to pay for it.

~~~
timbit42
There is a lot of savings in its low administration costs. Since it would
replace a number of social programs that have high administration costs, a UBI
actually saves money.

There can be additional cost savings in UBI (and even in existing social
programs) if it is structured to incentivise people to work. Many existing
social programs actually disincentivise people from working because they lose
the income from the social program if they work (too much) and it results in a
net loss for them, so they don't bother working.

If a social program is structured so that people don't lose all of their
social program income when they work, then they realize a net gain in their
income and they continue working. The longer they continue working, the more
likely it is that they will gain experience allowing them to make more income
on their own, resulting in a further reduction of their social program income.

A very simplistic example would be to remove 50 cents for every dollar they
make at their job. If they received $500/month when not working, by the time
they're making $1000/month at their job, they're receiving no social program
income anymore.

