What the biggest employment problem in the economy?

There are a lot of reasons for inequality and unemployment is one of them. It all boils down to the supply and demand for labor. When supply of labor is high or demand for it is low, wages stagnate or even fall. When supply for labor is low or demand for it is high, wages will rise.

Increasing unemployment is a decrease in the demand for labor which stagnates wages. Globalization and foreign competition is increasing the supply of labor also stagnating wages. The mechanization of a lot of tasks people used to do has decreased demand for labor. These are a few out of many unfortunate reasons for this trend.

It is estimated that between 1979 and 2007 about 54% of new economic growth went to the top 1%. During this period incomes of the bottom 99% grew by 19% while those for the top 1% grew by 200%. This is because since employers can still easily hire people by not raising wages very much, they do. When new profit is gained it goes to the people at the top.

However, income inequality is one out of several reasons wages have stagnated.

 

there's just too damned many people, and too many of them don't know how to do anything that's of (enough) value to others to be employed (where they live) People get hung up on a given place, stupidly buy a home (that they can't afford) don't save money, etc, then when things don't go perfectly, they cry about how "unfair" it all is. Try that sort of crap on a desert island, and within a few days, you'll find out the reality of life in this world. Either produce, or die.

 

Yes, yes, but I wasn't even talking about that phenomena. Even more basic than that. People who can't find jobs are the new "have-nots".

 

Reason number 8

8: Capitalism

 

Agreed. This whole "share of the nation's income" is collectivist claptrap. Individuals make income. Lets say that "the nation" consisted of two people, Joe and Bob. If Joe makes $50k and Bob makes $70k there is no "collective income" from which each draws a share. They each just make what they make.

The whole idea is promoted by those who want to take what belongs to others. Just another rationalization for the use of violence against one's peaceful neighbor.

 

I hope that is a joke. Capitalism is why we are more prosperous than virtually anyone else on the planet.

 

The percent of the workforce with a college degree is rising. This means that skilled labor is on the rise. So this idea that wages are stagnating because "too many of them don't know how to do anything" doesn't fit reality.

 

I linked a couple images showing underemployment in the US (U6). Currently underemployment is around 12% and is historically high. But the average is about 8-12% so we are not doing that badly. Around the 1980s it peaked at 20%. I think that poor people along with the unemployed are the have-nots.

 

Taken as a whole there is no question. But I would suggest that the stratification of our society is a problem. Time will of course be the determination of Capitalism's Sucess or failure.

 

You are making the assumption that just havong a college education means much in today's world. Suspect college has been as much dumbed down as most of America's educational system.

 

There are trillions of dollars sitting in banks, corporations, in offshore accounts and stocks.

I'm not sure what "anti-capital" policies your talking about, but we don't have a problem with insufficient capital at all. Quite the contrary.

The problem we have is insufficient demand. A product of a middle class that has been gutted by 35 years of "trickle down" policies coupled with Republican forced austerity.

 

Read the plutonomy report by Citigroup addressed to the 1%, it states the wealthy aren't saving because they're very comfortable income wise. Also there is more capital circulating amongst them then ever before, and even they admit it's because of a pro capitalist government. I call bull. https://pissedoffwoman.wordpress.com/2012/04/12/the-plutonomy-reports-download/

 

What's the biggest employment problem in the economy?

The US simply cannot compete with global competition and therefore has much less to manufacture in the USA. If the US cost of doing business grows faster than those outside of the US we will become less competitive.

If we're looking for more middle-class paying jobs then we must produce more in the US. But in order to do this US manufacturing must be competitive with off-shore...if not the imports just keep coming.

If we cannot, or refuse, to become more competitive in the global arena, then the status quo and all our current issues will remain in our future or even worsen...

 

oh, it has to worsen. there is simply no way that the US worker would, even if he COULD work for $20 per day, even if he was not taxed at all. And that is a SUPERB day's in a lot of the 3rd world today. They'l nearly kill themselves, 80 hours per week, for such a job.

 

News flash. The US manufactures ten times the goods it did in 1970 with less than 10% percent of the workers employed in 1970. The US is the largest manufacturer in the world by value of products produced and a close second to China in overall manufacturing volume. US manufacturers who chose to compete in world markets are extremely competitive in every sector on the international markets they compete in. Some manufacturers in the US who do not compete internationally are becoming less competitive in US markets because they have failed to make the investments necessary to maintain a competitive position.

In any case, it is insane to believe that manufacturing can provide jobs. Manufacturers have been increasing their output while reducing the number of jobs for decades and that trend is accelerating. It has been estimated that US manufacturing can double output by 2030 while cutting the manufacturing workforce by another 30%, a vast decrease in manufacturing jobs.

The good news is that manufacturing jobs are no longer for uneducated assembly line workers but for the skilled technicians and engineers who design, build, program and maintain the robots and complicated machinery that manufacturers now use to make stuff. In other words, US manufacturing will provide the good paying jobs you think it can, but no matter how much more they produce it will never be enough to solve the employment problem.

 

The answer is not included in the poll, the biggest problem with the economy is trade policy. NAFTA killed the jobs base in this country and the Trans-Pacific Partnership will finish reducing the American workers wage to parity with that of most of the rest of the world.

 

I believe that would fall under the categories of 'Wages for the jobs that already exist are too low' and 'Not enough of the good types of jobs'.

I was not asking what the underlying problems and causes were in the economy; just the immediate problems.

 

It is always a mistake to look at the surface of any issue without a clear and concise understanding of its root cause. To do so only ensures misunderstanding of the issue.

 

Over regulation.

 

The root cause of most of our economic problems is the patent system. It doesn't promote the progress of science as much as it promotes foreign slave labor. It protects established monopolies from competition by legally prohibiting the vast majority of individuals from employing themselves. To-big-to-fail monopolies are financially capable of creating all the $15/hr jobs America needs but they'd rather save a buck and higher Chinese women at $1.45/hr without benefits. This why America has such a huge disparity of wealth. Inventors certainly deserve recognition for their great works but nobody deserves a monopoly. Copyright should only apply to the protection of trademarks and brand names as manufacturer identities. Otherwise a stable and successful free market requires that everyone have an equal right to produce or reproduce whatever they want, limited only by consumer and environmental protection regulations.

 

Our fiscal policies don't match the exigency; why have a capital gains distinction if wages are not outpacing inflation?

 

The problem now is that tax policy, by reducing risk in capital market speculation through a low capital gains tax, has encouraged participation in capital markets which has resulted in the diversion of capital away from direct investment, which is the only sort of capital deployment that enables the deployment of technology and the creation of jobs.

In other words, as long as capital gains taxes remain this low the risk of investing money in the markets will be lower than the risk of investing money in business growth. Which is why so many US businesses deploy most of their profits in the markets instead of spending it to grow their business.

 

Not enough people are providing the things people want most.




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Exactly if people want to make more money it is up to them to make themselves valuable enough to earn it. The reason the rich make what they do is because they have worked hard and earned it.

 

That would be true if we were living in a free market. Unfortunately we're living in a captive market. I work hard and every hard-working person I know is nowhere near rich. So the notion that success is directly proportional to effort is pure bunk. The rich make what they do because they're educated and connected. They share inside information on sources of income that are protected by government from direct competition. The policies that protect companies from competition also serve to keeping the rest of us in check by prohibiting us from employing ourselves and competing against them. That keeps the job markets saturated and further depresses wages. And by keeping people employed instead of self employed, the government benefits by collecting taxes from us through our employers with maximum efficiency, no resistance, and regardless of our approval ratings.