We really need better ways of measuring economic health. I could lose my six-figure job, turn around, and get hired on as a server at Applebee's for minimum wage, and the "unemployment" rate would stay the same. Not to mention that it doesn't include those not actively looking for work.
Either way, "full employment" doesn't mean much unless you take into account whether people are actually able to live a stable lifestyle or are burning the candle at both ends just to put food on the table. One of these enables folks to buy nonessentials and fund all those sectors of the economy, the other doesn't.
We have good metrics. The problem is the media seems to only ever look at one of them at a time but we need to look at several at once to get a more complete picture.
Your scenario would be called out by median household income, or better median disposable household income. Even the good old GDP per capita covers your case.
Workforce participation also can be valuable instead of or in addition to unemployment numbers, since you fall out of the count once unemployment benefits expire. However, we need to look at it by age bracket. Lower workforce participation between 20 and 60 is probably bad whereas higher workforce participation over 60 might also be bad.
IMO the problem isn't that the metrics aren't there but that the public discourse either lacks motivation, understanding or incentive to take a proper look. That every discussion of these numbers on social media has a substantial portion of people not understand the difference between median and mean certainly doesn't give me confidence this will ever improve.
> Even the good old GDP per capita covers your case.
Absolutely not.
If corporate revenue increases, but wages stay the same, GDP per capita goes up, yet the workers aren't any better off. All that extra money is being absorbed by the ones at the top.
Median disposable household income is probably the best measure.
> Median disposable household income is probably the best measure
If I used to make $78k as a full time IT employee, but now have to work two jobs to make $78k, I still have same household income but I’m considerably worse than before.
A combination of hours worked, wages earned and household debt together would paint a much more accurate picture.
This metric of underemployment is captured in U-5 and U-6 in the BLS statistics.
It's less common to report, but in the aftermath of the financial crisis I remember hearing more about it. You can construct a chart in FRED that covers it:
If the analysis in the public discourse doesn't capture what matters, that's a problem, and that some more obscure report contains useful information is only a minor mitigation. If anything I'd say highlighting that obscure report is a perfect example of nerds using their abilities to contribute to the public discourse.
Economists get things wrong all the time. It’s not about others not possibly have thought of it already, it’s about the fact that policy and politics is still driven by other measures that are inaccurate.
Just because economists get things wrong, does not imply that therefore they can be, and need to be, corrected by computer programmers with superficial understandings of the field. You can both be wrong.
This is like arguing that politicians don't need to be corrected by non-politicians, or that people with no understand of programming can't criticize the tech industry.
No one is arguing that being a computer programmer gives a person unique insights here.
False equivalence. Politicians aren’t scientists, and people do criticize programmers all the time. I got at least 3 complaints at work today about bugs in our software.
Saying that economists are scientists and therefore above reproach from non-economists ignores the way that ideology and research become intertwined whenever public policy is involved.
Saying "trust the science" at all times, even when the scientists in question are neoliberal technocrats is how you end up with the populist backlash against "trusting the science" that America is presently going through.
Obviously people criticize can and should criticize programmers, that's the point.
I'm not sure household debt is a great indicator. Someone that has a mortgage will have much more household debt than a renter, but also not have to pay rent.
You could argue household debt is just another form of rent, where you “rent” capital from the wealthy in exchange for paying interest on a monthly basis. Just because you don’t pay a rent directly named as such doesn’t change the substance of it.
It's a very different form of rent though, namely because the mortgage borrower has a lot of collateralized debt and the mortgage borrower owns the appreciation (or depreciation) of the property (proportional to their equity).
Debt, within reason, is just a tool. It provides leverage and it lets you buy things for which you don't have cash-in-hand--houses in particular. It can also encourage overspending (something that car dealers capitalize on) but that's another story.
Similarly debt that got you a medical degree is different to debt on a shiny new car. A subsistence farmer in the DRC might have less debt than a college graduate, but that doesn't matter if the college graduate's earning prospects are excellent.
(No comment on the current reality of medical debt, of course. Just a general principle.)
The amount of equity you have in your home matters. Most recessions do not take 20% off home values, so people with conventional loans are pretty safe. Even the Great Depression just cut valuations about 35%.
If you lose your job in a depression there will be plenty of people willing to buy assets at a discount. If you have equity in your home then your position will be net positive. About half of all mortgages have an outstanding balance less than 50% of the home's value.
That kinda works in the abstract, but it's pretty risky for any individual house. If your house was somehow a representative slice of all US housing, sure maybe it won't drop 35%.
But if you owned a house in Detroit from 2003-2010 it might have dropped 70-80%. Or, more on point for many on HN, if you own a house in the Bay Area worth $2-$3M with 25% equity, and the tech job market collapses, then you might get completely wiped out.
What if I use debt to invest or to buy assets that increase productivity of my company?
Or for some loan you need to pay monthly 5% of your income (for iphone or car), and other loan need you to pay 50% of your income (mortgages). You cannot count them in the same way...
Or for some loan you need to pay monthly 5% of your income (for iphone or car), and other loan need you to pay 50% of your income (mortgages). You cannot count them in the same way. And mortgage can have 1% interest rate or 6%...
I think debt is good, actually, for most middle class households, and they're actively trying to increase their debt because that results in greater cash-flow, more savings, and more security in terms of retirement. That's why buying a home is Goal #1 for most Americans.
Home mortgage debt is mostly "good" debt for middle class households. Pretty much any other type of debt is a net negative in financial terms. There are less tangible benefits to owning a newer, more reliable car for example, so it can be a bit murky. General consumption debt is a bad bet for pretty much anyone.
Whatever metric or scenario you can think up, I guarantee governments, think tanks, private data companies, or universities are already tracking (or attempting to)
Even if they are, it's not very useful if they have an adversarial relationship to us, the worker. Government is the only one listed above that is supposed to be the champion of the worker, but when was the last time that was true? At some point, you have to do your own digging. Trust but verify.
> Median disposable household income is probably the best measure
Median disposable income won’t meaningfully capture OP’s case of losing a high-paying job and having it replaced by a low-paying one. For that you need to look at the distribution of household disposable income.
We have terrific economic metrics in America. It really should be part of a mandatory civics class to learn how to read them.
Household income is a funny collective measure. If housing becomes less affordable, household income increases, as kids stay longer with their parents. And if housing becomes more affordable, household income decreases, as kids move out earlier.
I think a better measure would be household income divided by number of adults in the household. Possibly with some consideration for the number of children in the household.
E.g. OECD normalizes household income by household size:
> Household income is adjusted for differences in the needs of households of different sizes with an equivalence scale that divides household income by the square root of household size. The adjusted income is then attributed to every person in the household.
Why does wealth inequality matter? If my real wealth doubles and Elon's real wealth doubles, inequality went up, yet everyone is tremendously better off. I think we are using inequality as a very bad proxy for poverty but we have much better metrics for that. I suspect people just dislike it for emotional reasons. I want to point out that Sweden has more billionaires per capita than the US. Yet everyone is fine with Sweden.
I can set an argument about political influence that's gotten really strong lately but maybe that's better addressed by strengthening the politically system
If everyone's real wealth doubles, that is great, but it is not a stable equilibrium.
If a very small percentage of the people own a large percentage of the wealth, it compounds. They literally cannot spend all of their income on consumption, except maybe by lighting piles of cash on fire, but that is not a route to doubling the real wealth of everyone in society.
That means that asset prices rise, and fewer people can afford property. Jobs concentrate near where rich people live, because they are the ones with disposable income to spend, making this worse. Transfer payments (rent) from ordinary people to the remaining property owners are high. Wages stagnate, because wealthy people spend most of their money on assets, not goods and services. Consumer demand decreases. Capital moves away from producing things that ordinary people need, because they can no longer afford them, and is instead allocated to producing luxury goods. Social mobility is low because low wages and high property prices make it impossible to work your way up.
The cycle is self-reinforcing, not self-correcting. Most of history throughout the world has consisted of a few very wealthy feudal lords and a large population of serfs.
Strengthening the political system might be nice, but post-Citizen's United, that does not seem to be the direction the US is headed, at least, nor is it in the interests of those who benefit most from the current system.
> Why does wealth inequality matter? If my real wealth doubles and Elon's real wealth doubles, inequality went up,
Not in terms of the ratio between you, which is the way we normally talk about wealth inequality : "he has X times more wealth than I do", or "she makes X times more than I do".
Anyway, this is not how wealth inequality has grown at all. It has happened by most people's real income barely rising at all over 40-50 years, while the rich have seen theirs rise by huge factors (hundreds to many thousands in some cases).
If what you care about is standing real wages why talk about inequality? I'm concerned that it just functions better as rage bait and leads to unproductive policies.
1. it is well established that human pyschology makes relative income and wealth much more significant than absolute. And it doesn't matter which quintile you're in for that to be true.
2. real median household income stayed relatively flat between 1970 and 2012. Since then it has risen again in a significant way.
3. despite the gains in real median household income, the rise in the household income (and net worth) of various upper percentiles (20%, 10%, 5%, 1%, 0.1% ... take your pick) has been very, very much larger. consequently, the "double my income, double Musk's income" line is not a description of what has happened.
4. the percentage of GDP that accrues to capital rather than to labor have gone steadily up since 1980.
If that's what "you've seen", then you aren't looking in the right places.
Look at the graphs of real wages vs productivity that start pre-1970. Yes, it's true that real wages have gone up some since that time, but they remain completely divorced from productivity in a way that's totally different from the time before Reagan.
Meanwhile, the income/wealth of the highest earners has gone up astronomically during the same time.
They are staggeringly wealthy because they have redirected the flow of money from us to them. This is a very clearly visible and uncontroversial fact. The controversy is simply over whether it is a good thing.
Wealth inequality matters a lot when rich people can spend unlimited amounts of money buying influence in politics and then use that influence to enact policies that favor the rich over the poor.
Aren't votes supposed to counter this effect? Individuals get the same voting power, so if things are too out of line, it should be easier to vote in folks that prioritize unbiased policies. Of course you could argue that the funds push up candidates for the wealthy for both parties, but independent media is allowing the unfinanced to compete.
Mainstream media companies are owned by very wealthy people, who vote Republican, and put their thumbs on the scales over and over again.
You can see that in a myriad of different ways, but at no time in recent memory has it been more blatant than during the last election cycle, with events like Bezos forcing the Washington Post to issue no endorsement rather than endorsing Harris.
Like, you can agree or disagree with the politics of it, but it should take a monumental amount of motivated reasoning to deny the existence of this bias in our media.
There is bias in all media. I used independent media to mean the plethora of single or small member operations that publish their findings on their own blogs, where they are not beholden to shareholders or investors.
There are also many emerging podcasts which either directly interview candidates or at least discuss the impacts of policy beyond the nonquestions presented by mainstream journalists. For example, how many times have journalists allowed Powell to say that he can't comment on proposed legislation like the BBB? Not once have we seen a follow up asking Powell why he has no comment on the bill considering his job is to offset its effects? His literal job is to comment on policy.
> events like Bezos forcing the Washington Post to issue no endorsement rather than endorsing Harris.
The Washington Post is independent media. It's just dependent on its owner like all media. I have no problem with Bezos' move concerning endorcements; he's maximizing his utility.
> I used independent media to mean the plethora of single or small member operations that publish their findings on their own blogs, where they are not beholden to shareholders or investors.
If you consider WP to be independent, then which news organizations do you consider not independent? Because I think most people define independent as "not owned or controlled by a billionaire".
I used it to mean news not published on behalf of someone else, so I was meaning one to small team operations. WAPO was my non-independent reference, but in the context of it publishing Bezos-directed articles, it is independent of non-Bezos direction.
Sweden has more billionaires per capita, because it’s fairly friendly to businesses and there have been quite a few success stories over the last century.
The US however have more millionaires per capita and SUBSTANTIALLY more people in poverty per capita.
Sweden’s Gini coefficient is 0.276 (2024), the US’ is 0.418 (2023). The US has a lot more income inequality.
It depends on what you're trying to measure. From a purely rational perspective, increasing inequality doesn't matter if everyone's quality of life is improving. But humans are irrational, and happiness is often tied to social status within the hierarchy. Even if you're materially better off you might find yourself lower on the status scale. Status is a zero-sum game. Maybe we shouldn't care about such things but yet most people do.
At billionairre scale money becomes qualitatively different compared to typical household scale. For households money typically goes to consumption (or future consumption via savings) whereas billionairre money goes to affect how productive (and often political) forces get organized.
At consumption money level at least inequality is also inefficient allocation of resources due to the diminishing marginal utility of money.
it matters when "something" become scarce that normal person need to compete with the richests to get, or if one day the richests decided they want something and suddenly those things become scarce. Let's not kid ourselves, majority of politics can be bought by billionaires and when some day fresh waters become scarce or wheat is, it'll be monopolized by the richests. We already get this in some way with housing.
>Why does wealth inequality matter? If my real wealth doubles and Elon's real wealth doubles, inequality went up, yet everyone is tremendously better off.
You forgot to mention, also the cost of everything doubles and maybe kicks off some good ole hyperinflation
Wealth inequality means all the investment and excess income goes to the top 0.0001%, rather than the average person. Whereas now this may support he average person's purchase of a home, or retirement, or similar, this now supports the billionaire's purchase of a million homes to rent to the common man, earn a fixed profit, to launch rocket ships with a head, two spheres at the base, and veins, where the billionaire with the biggest, longest, firmest rocketship is the winner! That, instead of people having houses and a retirement.
Lots of leaps of logic here. I'm certainly not fine with Sweden having a higher disparity of wealth but I don't live in Sweden so I can't effect much change there. We're also ignoring how many safety net benefits Sweden provides its population, ostensibly because it reasonably taxes its wealthy. If Swedes are ok with their situation, it's probably because it's being handled adequately.
The issue with disparity is it's a reflection of the unfair conditions of compensation. Elon Musk's employees make him that money, not Elon. He could make all of his employees multi-millionaires overnight by granting more generous stock plans commensurate with the money they've made the company. Reasonable profit sharing plans basically ensure this, but since companies all collude to not grant them, we see them as relatively rare in the working world. The state should be requiring companies to grant profit sharing. Not gonna bike shed it here, but it needs to be done yesterday.
> If my real wealth doubles and Elon's real wealth doubles, inequality went up, yet everyone is tremendously better off.
What's this universe that only contains you and Elon? Or do you think that everyone's real wealth has doubled?
> I can set an argument about political influence that's gotten really strong lately but maybe that's better addressed by strengthening the politically system
Citizens United has practically dismissed that possibility in the near term.
“The Measure of Progress: Counting What Really Matters” is supposedly a good book discussing the inadequacy of GDP as a metric for how well off a society is.
Also a great measure is the money supply & velocity chart - the M2.
If GDP goes up and the velocity of money drops, it means that real economic gains are not being realized by those who actually spend the majority of their income versus saving it.
Not that there's anything wrong with saving money - it's just that the more money that is being spent regularly, the healthier the entire economy is. Generally.
Certainly not in isolation. It measures inequality. If everyone has nothing you get a perfect Gini score. Pakistan, Ukraine, Belarus and Algeria have a lower (better) Gini score than all of the Americas and most of western Europe and Japan. Want to move?
The Gini coefficients published for deeply corrupt countries like Pakistan and Ukraine are almost certainly a total fiction. Much of the real wealth held by the elites in those countries is hidden from official statistics.
If a software engineer starts working at Applebees, GDP will decrease. If lots of software engineers do it, GDP decreases more.
If corporate revenue increases and is spent (as most revenue is), then the workers will be better off in the most bland "raising all boats" sense of the word - there will be more competition for their labor and more opportunities for them to jump ship.
GDP gets a bad rap but if I had to pick a single metric, that's the one I'd choose.
I attended a talk by Alberto Alesina (RIP) a few years back and he made the point that, yeah, GDP isn't perfect, but by and large, people in countries with a high GDP are healthier and happier. It might not measure the difference between the US and France as well, but it's pretty good at pointing out that Sweden is doing better than Somalia.
One thing I remember from the first Dot-com crash circa 2002 is that the service quality in Silicon Valley area restaurants suddenly got a lot better. There were a lot of former "HTML programmers" forced to find other jobs.
Right - if you ask a heart surgeon to wait tables they'll probably do a great job!
But it's still a waste of their talents and society as a whole will be worse off than if they did heart surgery. You can measure that because a waiter makes minimum wage and a heart surgeon does not - the heart surgeon contributes more to the GDP than a food service worker.
That's the meaning of that metric and that's why it's useful.
That was not the argument. The argument was that their case "lost six-figure job, working as waiter now" was covered by GDP/capita, and it is. Applebee's doesn't make the same revenue per capita as a place that hands out six-figure jobs.
Your argument is the exact reason why the media focus on a single metric is bad - because some but-whataboutism will always pop up and use it as pretext to debate an unrelated issue not covered by the metric.
It's also the exact reason why we shouldn't measure economic health as a single metric at all - it's not that to whom value accrues doesn't matter, it's that it's a different metric than how much value is generated in the first place.
It also explains why there isn't a single best economic policy - the absence of a single metric means there is no strict ordering.
(You can easily construe a counter-argument why median disposable household income isn't the best metric, either: "Median wage is stagnant, everybody needs to take a second job so disposable income goes up". And you can do that for every single metric in isolation)
> Even the good old GDP per capita covers your case.
I think the following joke encapsulates the problem with GDP pretty well..
---
Two economists go for a walk in the forest, and having a competitive nature, the first economist sees a pile of bear shit and says to the second "I'll give you $100 to eat that bear shit". The second economist, being one that generally does anything for money, eats the bear shit, takes the $100 and they continue on their walk. The second economist wants to get back at the first, sees another pile of bear shit and says "I dare YOU to eat that bear shit for $100" thinking no way they will actually do it. Not wanting to be outdone by the second economist, the first also eats the bear shit and takes $100.
After walking a bit further, the second economist stops and says to the first "Wait.. did we just both eat shit for nothing??" to which the first replies "No of course not, that would be crazy.. we increased GDP by $200".
---
I can't remember the source of the joke but been around for a while and I may have butchered some of the original details.
the joke is a joke, and is meant to illustrate a point. However, i think it's actually illustrating a different point than the intended one.
The fact is, those economists valued watching someone eating shit at $100 dollars. How is that any different than someone paying $100 dollars to watch a concert?
It perfectly illustrates the idea that value is in the eye of the beholder.
I think it's time to switch from GDP per capita to household income. You might think the two are practically the same, and globally that's true, but at the regional level there can be stark discrepancies.
One example: Ireland's GDP grew a staggering 25% in 2015 [0], mainly because Apple decided to book more of their profits there. It does lead to higher tax revenue, but creates relatively few jobs or other income there. The profits go to Apple shareholders, who mainly live outside Ireland. Household income would more adequately reflect where those benefits go than GDP.
Plus, with household income it's more natural to look at the median in addition to the mean, which is the more robust metric, statistically speaking.
I think income is still too crude and misleading. You really need some kind of complex individual economic health measure made of many indicators.
But a more informative proxy would be median net worth - individual, not household, with married couple net worth divided by two for simplicity - as a fairly simple assets vs liabilities calculation.
The net worth distribution would be even more revealing because it would highlight the difference between owners and renters.
This still doesn't reveal net worth stability. In the US you can - and many people do - go from a seven figure net worth to bankruptcy because of a health crisis or (increasingly) a climate disaster.
So you'd want a supplemental distribution showing how variable net worth is, how many people are reduced to bankruptcy at each decile, and how much movement there is in each decile.
Reducing these kinds of complexities to a single number seems misleading at best.
> Even the good old GDP per capita covers your case.
Not necessarily. If most of the difference in pay goes to shareholders and/or executives, then the GDP per capita doesn't change. This could be because technology increases productivity, but in a way that increases wealth inequality, and results not only in greater wealth for the already wealthy, but less wealth for workers who are no longer needed.
Not to come off as too cynical but I've increasingly come to the conclusion that the public discourse stays generally at a very shallow level that basic research for 30 minutes quickly moves you beyond. On one hand I find that appalling and poisonous for a democracy. On the other hand, imagine everyone having to spend 30+ minutes on every important topic. It quickly gets out of hand. One could argue that the media should do that research but if they incorporate that in their communication they lose most of their audience who needs to be picked up where they are.
It's why I recently have been convinced that we need something like election my jury
> It's why I recently have been convinced that we need something like election my jury
I think this is how the electoral college was intended to function. This is a hard problem to solve, especially when some of the players aren't operating in good faith.
> public discourse stays generally at a very shallow level that basic research for 30 minutes quickly moves you beyond
This is convincingly (to me) explained by the removal of critical thinking courses in public schools, at least in the US. I never experienced them myself but I've heard they included exercises like determining if a statement is fact or opinion, true or false, etc. There was very little of that when I was in school and it was certainly never a dedicated hour-block in high school.
I agree with the premise here completely, but not what it's in response to necessarily.
Most people keep very shallow knowledge of most subjects, but this doesn't mean things shouldn't be reported. It just means they(media) shouldn't spend a ton of time explaining how said numbers are calculated. Most people read, hear, or otherwise know the current inflation rate, but not exactly how it's calculated.
All that to say, if some metric isn't being reported, there's a reason - likely for some agenda being pushed.
Technically these aren't incompatible: it's possible that democracy doesn't work but nothing else does either— there's no natural law that says there must be a system of political and social organization which actually works in the world we have now. I have been drifting in this direction myself the last few years; it's discouraging, but it seems to be the only conclusion supported by the evidence.
That's true, but there is a natural law that says that there must be some system of political and social organization that gets employed in practice, so hopefully we can identify the least ineffective one.
It works ok in the short term. Note that most democracies (especially the current best performing ones) are extremely young despite the idea being ancient.
You see this on smaller scales as well. Most of people's complaints about "capitalism" are really about the short sighted decisions corporate leadership often make because it has to answer to an anonymous mob of shareholders.
The only thing that actually works is good leadership with long term vision and if anything democracy gets in the way of that.
The benefit of democracy is that it has somewhat of a self-correcting mechanism build in and it functions without violence. Autocracies don't have that.
You say Democracies have a short track record. While this is true in the grand scheme of things, each individual non-Democracy that came before did as well. Rulers conquered each other's countries, usurped the current leaders etc. quite regularly. I'm not sure I'd count that as stable and longer-lasting.
Autocracies have plenty of self-correction mechanisms. Generally each level is sustained by some kind of grudging consent from the levels above and below.
Right. Usually there is 100% authority in some kind of dictator. You instead have something that is more like an oligarchy. You have different interest groups with varying levels of influence. In some sense democracy works like this too. Every society has stakeholders that need to be bought off or suppressed and there are various equilibria on how that is done.
There's the problem of scale, and also of duration. Let's say Lee Kuan Yew genuinely wants what's best for Singapore as a whole. How do you ensure that the next autocrat will be equally benign?
This is the exact issue. There is a lot more variance in autocrats. You can get Lee Kuan Yew and you can get Kaiser Wilhelm. With democracy you are much more likely to get something in the middle. In the end of the day the cost of an bad autocrat is higher than the opportunity cost of a milk toast government compared to Lee Kuan Yew. China is still catching up from the Mao years.
I do work that social media will change this though
Both actually. Milquetoast was a fictional character used to characterize extreme timidity, as if he were the personification of milk toast.
Eventually, the name became a synonym for the attitude. But the name comes from the food
> the public discourse either lacks motivation, understanding or incentive to take a proper look.
Indeed. Almost always in these discussions people have already made up their minds about the state of the economy and will just cherry-pick whatever metric best justifies their case (typically that the economy sucks).
There's never been a time in my life where people weren't complaining about how the economy is terrible and how that's clearly obvious if you just look at the real numbers.
I’m just going to pile on by suggesting you really concern yourself with looking into why GDP is absolutely not a good measure. You may want to start with the fact that the economist that developed GDP has long been outspoken against how it has been used and wished he had never developed it.
The fact that the government printing money and then squandering it on some thing useless makes the GDP go up, should be your first clue.
I don’t think you are a great success in life if you take on debt from organized crime, spend it on hookers and blow, and then tell everyone how rich you are based on how much you spent, i.e., squandered.
> Even the good old GDP per capita covers your case.
GDP or even GDP per capita is not the best metric. You can sell 100 iphones for $1000 or sell 500 cheap androids for $200 and both countries will have same GDP but I think output and outcome is much better in latter case (you produced 5x more products and 5x more people can benefits and be more productive with those 'tools'). Sure iphone for $1000 is better than $200 android phone but is it 5x better? Same with cars you can sell ferrari or more cheaper toyotas for the same value. We would have to measure how much goods we can produce.
Nobody is incentivized to share bad news about the economy. Everyone has a vested interest in the stock market rising, in keeping their jobs, and a shared desire to see things go up forever.
This is why there needs to be some kind of safety net so that the economy is not a proxy for life and death. In the USA, if you run out of money, you are in real trouble. We need to decouple success/failure in the market from personal safety. You should be able to try opening a hot dog stand, have it tank, and still be able to eat and go to the doctor.
>Nobody is incentivized to share bad news about the economy.
Isn't the media incentivized to keep you watching or reading? The common criticism of media is they like to exaggerate a minor issue to get you to click on a headline.
They might be short sellers, or they might be foreign and view the US as an economic rival. There may be more incentives than just more clicks for the media.
A more likely explanation is that outside of a few specialized publications, most members of the media are just as financially and economically illiterate as the average person. I mean how many finance and economics courses do you have to pass to get a degree in journalism or communications? There's no deep media conspiracy here.
> Workforce participation also can be valuable instead of or in addition to unemployment numbers, since you fall out of the count once unemployment benefits expire.
Unemployment rates are calculated based on surveys. They call many people and ask a series of questions to determine which category they fit into.
Yeah, the relevant definition of unemployed is basically "did you reach out to anyone in any way about a job within the last four weeks?", even asking a friend if their workplace is hiring would count.
And the survey is surprisingly thorough, with around 110,000 individuals surveyed each month.
There's a quite good writeup at: https://www.bls.gov/cps/cps_htgm.htm
That is part of it but it goes beyond it. I have a group of friends who are pretty much all nerds and every once in a while we end up discussing how desirable different countries are to live in. Because we are nerds metrics will be pulled out. You just need to look at so much and depending what you personally care about things can be very misleading just because you scoped some metrics wrong. It's not obvious to everyone that Ireland has a high GDP because corporate profits get funneled through there. Looking at many European countries you might think salaries are pretty good, especially when PPP corrected. Well, Unless you are a software engineer. Houses might be cheaper, till you look at price per squarfoot... It's genuinely hard.
Media covers plenty. We call it "headline unemployment" because it fits in a headline. If you read articles and analysis there's plenty of places in the MSM that get into nitty gritty.
> I could lose my six-figure job, turn around, and get hired on as a server at Applebee's for minimum wage, and the "unemployment" rate would stay the same. Not to mention that it doesn't include those not actively looking for work.
This is captured as part of the "U-6" figure for unemployment. The thing is, at a large scale, these events don't matter. They are rare enough to be noise in the grand scheme of things.
The reason the U-3 is the canonical "unemployment rate" is because that is where the core signal is. The bulk of the change in all of the other more inclusive rates is the change in the U-3 scaled by some factor.
But really, your complaint has nothing to do with actual employment, but instead with earnings. Wages are also a metric captured and reported by the BLS and better serve your message.
U3 is kinda silly but is mostly used because it is the original employment rate definition and therefore is comparable across time.
U6 would not include the original poster unless his new job was "minimally attached or part-time for economic reasons." U-6 does not, generally, include people who got a new job for lower pay.
The harm is when people take the metric as literally "what percentage of people who want to be employed can find a job", which U-3 emphatically does not represent.
It doesn't directly measure it, true. But the parent poster was saying it has extremely high positive correlation to measures that do measure it, so it probably doesn't matter.
By that logic should we also further broaden "unemployment" to mean "100% - employment rate"? That's a pretty common misconception as well, maybe even more common than the one you listed.
>This is captured as part of the "U-6" figure for unemployment.
I always wonder how this is captured. For U-3, you could go with the number getting unemployment benefits. For U-6, you'd have to literally call people and ask them, and I've literally never been called to ask if I'm working in my field and I'd guess most of us haven't either. I have to think if they are sampling, it's a very narrow sample likely biased by geography, industry, age, etc.
U-6 mostly comes from the BLS Occupational Employment Survey.
I don't think the original poster would be considered as part of U-6 unless his new job is defined as "marginally attached to the workforce or part-time for economic reasons." Simply getting a job with less pay doesn't put you in U-6.
If that's true, you've identified a huge hole in the measures. And you can't fix what you can't measure. I think you're right, because despite massive tech unemployment in the last 4 years, I don't see any of the charts spiking. Furthermore, people keep saying "this is captured in Figure X" but if it were really captured, it would be somewhat separable and could produce a chart that shows it in detail. I fear we're giving the Fed too much credit here.
The models are pretty complicated and incorporate several data sources, sampling is just one part of it. I've seen (very dry) documents that go into the methodology in detail. The model does introduce some obvious biases through assumptions of representativeness but how those interact with the headline numbers is not straightforward.
You of course know that we have a diverse set of metrics for unemployment that capture all of what you are talking about right?
And that is before we talk about alternative signals like the ADP number this like references.
Anytime someone says “we need better ways” you should just read it as “I should do more reading”, because this is a very well studied, understood and measured set of data.
Yes, it's extremely irritating every time people trot out the same copy-pasted complaints about the BLS unemployment rate and how wrong it is, ignoring the fact that the BLS publishes six different unemployment rates, which specifically address most of those complaints. It's a sign of terminal incuriosity and using only superficial and secondhand sources of information like news reports on the unemployment rate, and thinking this is enough to make you qualified to do critique.
It's also a sign of intense hubris - the idea that thousands of labor economists have never considered something they thought of after 30 seconds of reading means that either a) the economists are all idiots or b) the reader is orders of magnitude smarter than them.
The communications from the BLS are quite good and easily understandable. The problem is that the people making these complaints aren't reading those, they're reading the mainstream reporting on the BLS stats, which is extremely lossily-compressed, and then assuming this makes them qualified to criticize the underlying stats. Journalists deserve some flak here for the superficial way they report on the numbers, but at some point it's on you to get the real thing before you start trying to correct it.
> but at some point it's on you to get the real thing before you start trying to correct it.
One thing is for sure is that people aren't going to do that.
Anyway, it seems disingenuous (or just completely irrelevant) to complain that people are attacking the BLS rather than how this is wielded to perpetrate a polemic.
My point is one doesn't have to go to the original sources, they simply have to ask themselves "is it likely no one has thought of this before?" before launching into a criticism...
This happens everywhere with lots of people in many different contexts. I call it the “‘why don’t we just’ disease”, or WDWJ Disease. When you’re in any leadership position, you have to stay especially careful to catch yourself from falling prey to this pernicious effect and behavior, and its equally debilitating sibling yak shaving when you over index on preventing WDWJ.
The mistake you are making is believing people are interested in the truth and the assumption that humans are rational truth seeking agents.
People mostly consume news as a form of entertainment with a dopamine hit from having their prior beliefs confirmed or for gossip. It is why the "news" is so popular.
I have thought quite a bit about building "real" news outlets but it is hard to not conclude it is a waste of time.
Reinforcing priors and gossiping is just what humans do. In the west, we really get off on a simulation of truth seeking even when the slightest bit of analysis can show the simulation is ridiculous.
The Titan submersible news event is really a great lens to grasp this in retrospect considering anyone with domain knowledge knew right away the truth that the Titan had imploded.
> It's a sign of terminal incuriosity and using only superficial and secondhand sources of information like news reports on the unemployment rate, and thinking this is enough to make you qualified to do critique.
Agreed, I just dismiss complaints about the unemployment rate unless the poster/speaker mentions/alludes to U1 to U6.
The OP in this comment chain is just ‘old man yells at clouds’ in HN form, complaining about a lack of statistics without checking to see if those statistics are measured (which they are).
This response is a bit less than helpful. Could you provide an example of a metric from this diverse set that fits what the OP is asking for? I feel like there are at least two use cases from their post:
* a metric that measures if people's jobs are paying enough to put food on the table
* a metric that measures whether people's employment matches their education?
Your second query is more subjective. Most people would probably point you at the U6 underemployment number as that’s the most famous one. I like the employment projections series for this kind of question though
https://www.bls.gov/emp/
If you're talking about the spike in Q1 2020, there's nothing weird going on. That's from all the service workers getting laid off, which bumps up the average because they're typically lower paid, and no longer drag down the "employed" average.
>The usual weekly earnings data reflect only wage and salary earnings from work, not gross income from all sources. These data do not include the cash value of benefits such as employer-provided health insurance.
> If you would like to live passively in all aspects of your life
Nah man, I'm clearly just talking about hacker news comments.
Being kind to people on here (and the internet in general) is a sign of good faith, and you are more likely to get your message across.
In this instance, maybe just assuming the person doesn't know about this other data, and educating them on that fact.
Being passive aggressive, or actively aggressive, on an internet forum is usually pointless. It indicates you're an asshole more than it serves as an indictment of whoever you are replying to, 100% of the time.
Of course we have alternative measures of unemployment but they're harder to measure and read.
There's something about the so-called "vibecession" - that people might be better at measuring their own circumstances than macroeconomic data provides. In hindsight this is sort of an obvious take.
Real wages and high quality full-time employment have declined, but more importantly wthat people use to measure well being such as career outlook and price of "joy" expenses (concert tickets, hobbies, travel etc.) has significantly contracted or outpaced inflation.
Lastly, rep. Ocasio-Cortez struck me with a description of this socio-economic climate on NPR's morning edition a while back. https://www.npr.org/2025/02/28/nx-s1-5306406/alexandria-ocas...
In short, she noticed that "everything feels like a scam" - that is, digital distribution has enabled more complex fees, price discrimination, offerings are better optimized for profitability etc.
It is important to note that life satisfaction and happiness are weakly correlated metrics, quite famously so. One is not substitutable for the other. In particular, life satisfaction is correlated with income at all scales whereas happiness is not.
You optimize for one to the detriment of the other. American culture is atypically biased toward the "life satisfaction" side of that tradeoff.
I would expect that data to be mostly noise though, after all, there is pretty strong evidence towards some soft form of "set point" level of happiness: https://en.wikipedia.org/wiki/Hedonic_treadmill
What does that tell us? One person could be unhappy because their boss verbally abuses them every day in team meetings. Another person could be unhappy because their decent and fairly paid job prevents them from playing video games. Finland is once again ranked #1 on the World Happiness Index as the happiest country in the world, yet has a suicide rate much higher than the global rate.
I think the bottom line is that there is no one figure that informs us about all questions. But certain figures have strong correlations. People rag here almost daily about how GDP/Capita is a poor measure of x, y, or z, yet cannot name a low gdp/capita country they'd prefer to have been born in. Because GDP/Capita correlates very precisely with higher standards of living.
"To be sure, the ADP report has a spotty track record on predicting the subsequent government jobs report, which investors tend to weigh more heavily."
> The government recently disbanded two outside advisory committees that used to consult on the numbers, offering suggestions on ways to improve the reliability of the government data.
> At the same time, Commerce Secretary Howard Lutnick has suggested changing the way the broadest measure of the economy — gross domestic product — is calculated.
> Those moves are raising concerns about whether economic data could be manipulated for political or other purposes.
> We really need better ways of measuring economic health.
What would that look like to you? It seems to me no single, measurable metric is going to tell you economic health. They're a bunch of indicators that need to be interpreted.
If the same amount of wages are getting paid out and its merely getting reallocated as to whom, that's a very different scenario from people getting laid off to reduce labor costs.
Unemployment is meant to track how many people are working, not income equality.
> that's a very different scenario from people getting laid off to reduce labor costs.
Not necessarily. People could be laid off to reduce labor costs, in order to distribute more wealth to those at the top. And since the average is national, it doesn't even have to be at the same company. People could be laid off from company A, because A is unable to compete with company B that has a smaller head count, but pays their execs more.
> Unemployment is meant to track how many people are working, not income equality.
Sure, but the point is that metrics used to discuss economic health don't typically include metrics that represent wealth inequality, or the standard of living of the general population.
> People could be laid off from company A, because A is unable to compete with company B that has a smaller head count, but pays their execs more.
This is exactly the scenario I was describing - this is not a sign of a cooling economy with rising unemployment or underemployment, this is a sign of firm B outcompeting firm A. It might be interesting in its own right, but it's very much not what unemployment is meant to be tracking.
> Sure, but the point is that metrics used to discuss economic health don't typically include metrics that represent wealth inequality, or the standard of living of the general population.
Tons of such metrics are frequently discussed. Things like ratio of CEO to employee pay and income percentages are given all the time. No one feels the need to compare the unemployment rates when it's mentioned CEO to employee pay has increased from 20:1 to 290:1 since 1960. Everyone understands that the economy is a complex, multifaceted thing and the fact it may be doing well or poorly by one metric has no bearing on a discussion of a different aspect.
People care about employment rate because work is critical to our culture - we spend most of our lives working, we identify ourselves by our professions, we rely on income for both survival and social status, most of us would find it extremely unpleasant to be without a job for an extended period of time, and most of us would be delighted if our skills were in high demand at the moment such that we could confidently secure better pay. Regardless of wealth inequality, the overwhelming majority of us want unemployment to be low, and primarily frictional. An unexpected spike in unemployment is well correlated with various bad things which we would love to avoid or at least prepare for. It is a useful metric for economic health, like resting heartrate is a useful metric for bodily health. A good resting heart rate doesn't mean you have nothing else to be concerned about, but a bad resting heart rate is a concern regardless of whatever else is going on.
> This is exactly the scenario I was describing - this is not a sign of a cooling economy with rising unemployment or underemployment
It could be. What if B is outcompeting because they have offshored labor, or using new technology that reduces demands for labor. Not that those things are necessarily bad, but just because the total productivity is increasing doesn't necessarily mean everyone is better off.
My point is that the situation described can happen without a change to the average income, and average income isn't a good metric for watching changes in wealth inequality.
> but it's very much not what unemployment is meant to be tracking.
I never said it was.
> Tons of such metrics are frequently discussed. Things like ratio of CEO to employee pay and income percentages are given all the time
IME, such things are talked about much less than unemployment, especially in relation to politics and policy.
And I think part of the reason for that is because it is easy to understand, and it is easier to control with policy than other metrics, since the government can just create new jobs and provide incentives to create jobs, even if those jobs are lower paid than the jobs that were lost.
Perhaps we need better metrics actually tracking income inequality, because tracking employment rate without that seems pretty disingenuous as a metric of aggregate economic health.
Or rather, we should be reporting such metrics that we surely must track already together.
I don't follow at all. Which of these is supposed to correspond to "aggregate economic health"? The problem is that unemployment, particularly U-3, is a bad signal for aggregate economic health by itself. As is GDP. You need an signal for wealth distribution to get a sense of how a given person can interpret to understand how well the economy is serving them. At the very least.
EDIT: Of course, the ultimate issue is people wanting to cherry-pick metrics to push their polemic. If you have any solutions to that I'm all ears. We've been able to articulate an accurate understanding all along, but that doesn't make for easy headlines or simplistic campaign platforms.
> Which of these is supposed to correspond to "aggregate economic health"?
There's no single metric for aggregate economic health in the same way that there's no single metric for aggregate server health. There's a problem in expectations when people complain about U-3; its not supposed to be a measure of economic health. And thats the point being made here.
And yet, that's exactly how U-3 is used by everyone but the labor economists that define it. Hence why this conversation is happening in the first place.
> that's exactly how U-3 is used by everyone but the labor economists that define it
No, it’s not. Enterprise demand planning, market research, hell even political analysis for donors and politicians——everyone who has a use for the data knows how to use them.
If you want to see the contrast in treatment, compare the Financial Times and Wall Street Journal publications versus free media, e.g. CNBC or TV news.
Yes, and the fault is on the people using U-3 that way, not the economists. Talking about the problems with U-3 implies that the economists messed up. The issue is that everyone is looking for a quick 5-second way of making conclusions about a complicated topic.
We don't need a new metric. There is no new metric that will satisfy that criteria. The only solution is to improve the way we talk about the economy.
Is it disingenuous to report obituaries without including birth announcements in the same article? Surely only reporting the one gives a skewed view of demographic health.
News is about reporting new information in a timely manner. When a metric gets updated, it's good to let people know, especially if the new value is unexpected. Many people may have various different uses for this update. It is impossible to give every piece of data anyone could consider useful in a single article. Luckily, that is unnecessary. All that information is publicly available and people can go look it up for themselves at any time.
If you don't care enough to look up the metrics that are reported, that's not a problem with the metrics or the reporting.
> Is it disingenuous to report obituaries without including birth announcements in the same article? Surely only reporting the one gives a skewed view of demographic health.
The point of obituaries is not to give any sense of demographic health.
> News is about reporting new information in a timely manner. When a metric gets updated, it's good to let people know, especially if the new value is unexpected. Many people may have various different uses for this update. It is impossible to give every piece of data anyone could consider useful in a single article. Luckily, that is unnecessary. All that information is publicly available and people can go look it up for themselves at any time.
Sure, but the issue is that the reporting treats the metric as meaningfully representative of accessibility of employment when it's actually representative of who is seeking the unemployment benefit.
> If you don't care enough to look up the metrics that are reported, that's not a problem with the metrics or the reporting.
> The point of obituaries is not to give any sense of demographic health.
And the point of unemployment statistics is not to give any sense of economic equality.
> Sure, but the issue is that the reporting treats the metric as meaningfully representative of accessibility of employment
Because it is a pretty good proxy for this. When unemployment is high, wages tend to stagnate and it takes longer on average for people to find new employment. When unemployment is low, wages go up and people tend to have a much easier time finding a job quickly. There is a remarkable correlation between people seeking unemployment benefits and accessibility of employment. Sure there are people who would rather take a low paying job than the benefits, but there have always been such people, and the proportion doesn't quickly change, so within reason you can compare the situation at time A with the situation at time B based on the metric which is measured the same way at both times and get a pretty good sense of what the difference is.
It is not the end all be all, but nothing ever could be. It is one of countless metrics, all of which have their appropriate uses.
The U6 unemployment rate is supposed to cover those who are underemployed. What is usually reported is the U3 unemployment rate which is closest to that used internationally as defined by ILO.
Supposed to, but doesn't. The U6 rate includes two new things: part-time workers, and a very strangely-defined category: people who are NOT working at ALL, AND were looking for work previously, AND have stopped looking for 4+ weeks.
It doesn't capture the common on-the-street definition of the word "underemployment", such as a tech worker flipping burgers at mcdonald's.
Perhaps that category is simply to hard or expensive to measure, or it's specifically being avoided. Either/or really.
Heh, "it's probably tracked somewhere by economists". The more I learn about economics as a "science" the more I balk at the idea of giving them the benefit of the doubt, which people seem really willing to do for some reason. I know, it's scary that the economy might be a complex system that nobody understands, and it's easier to have "faith" that there is some shadowy economic cabal of god-kings who are keeping a watchful eye on it. But,.. yeah, that doesn't seem to be true, honestly.
the only signal I can think of is returns on student debt to measure "employment quality" - i.e how well is my education capital being deployed, but any realistic evaluation of the labor market will be complex and include qualitative data.
There are six kinds of unemployment stats the US tracks (below). Nothing sounds specific to underemployment by skills specifically (maybe u-6?). That would probably come from other metrics, like quintile income distributions shifting downwards?
You didn't ask, but just in case (from an internet search):
U-1: Long-term unemployed
* Definition: People unemployed 15 weeks or longer, as a percentage of the civilian labor force.
* Purpose: Measures persistent unemployment.
U-2: Job losers and temporary workers
* Definition: People who lost jobs or completed temporary jobs, as a percentage of the labor force.
* Purpose: Captures recent layoffs and temp contract ends.
U-3: Official unemployment rate (headline rate)
* Definition: Total unemployed as a percentage of the civilian labor force.
* Purpose: This is the standard "unemployment rate" reported in news and economic discussions.
* Definition: U-3 plus discouraged workers (those who want a job but stopped looking because they believe no jobs are available).
* Purpose: Adds a layer of marginal attachment to the labor force.
U-5: Unemployed + All marginally attached workers
* Definition: U-4 plus all others marginally attached to the labor force, not just discouraged workers.
* Marginally attached workers: People not currently working or looking for work but who want a job and have looked in the past 12 months (but not the past 4 weeks).
U-6: Broadest measure
* Definition: U-5 plus part-time workers who want full-time jobs (i.e., involuntary part-time workers).
* Purpose: The most comprehensive measure of labor underutilization, including: Discouraged workers, Marginally attached workers, and Underemployed part-timers
Not at you personally, but your post being top and active, while not really relevant to the story presented always makes me wonder do people upvote these tangents to prevent discussion on the threads original topic?
> do people upvote these tangents to prevent discussion on the threads original topic?
No, they upvote because they agree with it.
Just as some people flaunt their incompetence with basic math or civic involvement as a point of pride, it’s somewhat common in tech for folks to hold their lack of familiarity with economics, particularly econometrics, as a point of pride. (If you wanted to bury it, you’d flag it.)
This is a citizenry education problem, a media problem but not a metrics problem.
These metrics are built and used by people who do apply multiple measures - every day. If you are in a trading or macro oriented role, you will not be using just one figure. You will make the effort because your incentives and training encourage you to do so.
The non-specialist, which is most people, is never going to have a set of metrics which make it easy, because no metric can overcome all the practical and technical issues strewn across the path to producing it.
A big tech company firing a few thousand current employees and hiring twice as many H1B workers shows a net gain for jobs health, when this represents wages dropping, more people unemployed, and has a very negative impact on the economy. Many big companies game the metrics being Goodharted by regulators and watchdogs, and people guilelessly buy into the headlines, without inspecting the reality underneath.
There's also labour participation and underemployment to look at.
In your case underemployment would go up.
You need to look at all metrics together to get a bigger picture. Example is unemployment is down, but so is labour participation. That doesn't mean there was job growth, it means people stopped looking.
Or if unemployment is down, but underemployment is up. Similar picture emerges.
I am a bit confused.. If you are willing to work at Applebee's for minimum wage job, then you are employed. Why should you be considered unemployed?
If you all you can find are the minimum wage jobs and you choose not to work there, then you should be considered unemployed and if you are long term unemployed, U6 captures that.
Same with the stock market completly decoupled from the real economy. It's a wealthy index, there could be a real recession and the stock market still would go up.
Stock market measures two things,
1) the performance of firms within their economic environments.
2) the level of savings to be invested in the stock market.
Both are tied to the labor-share of income. That is, how much income is generated through yield on capital (firm profits returned to shareholders, rents, financial services) compared to earned through labor.
We do - People employed part time for Economic Reasons.
If what your looking for is 'People with salaries below the highest they've ever earned', then you're just going to get a very noisy metric of sales people on bad commission years, etc.
These are statistics. 1. It's not a problem if one of them does not reflect you specifically. 2. You never use just one. It is a problem if the measure needs ongoing adjustment to keep some kind of meaning and if this adjustment is partisan. It's also a problem if someone reads one number just to make a point.
I have been thinking about this a lot recently as well and think there is a really simple answer and fix and am frustrated I haven’t seen it meaningfully attempted or discussed anywhere (passively consuming message boards etc)
Cash flow per person (per household) just like the IRS does (except also including money from loans).
We know about all of those things and BLS publishes (or at least used to) reliable stats on them.
The unemployment rate as reported is probably the best way to report objectively on employment and the ebb and flow of layoffs and hiring. A more qualitative assessment requires more adjustments and interpretation.
I may be one of those statistics soon. My company refuses to lay people off but they are sending people out via wildly unrealistic expectations (move the goal post). The job market for six figure salaries is weak and I imagine many companies are doing this very same thing.
You seem to want better reporting of economic news. I would say to vote on it with your pocket and pick a better selection of news sources, but I'm not sure those better sources still exist.
Either way, nearly nobody uses the numbers you see on the headlines for any serious decision.
I agree, among the many things that need way better measurements, chief among them besides unemployment, being economic preference, is an alternative to the nonsensical GDP.
But regarding unemployment, another absolutely bizarre fact of that measure of whether people have a means of producing in order to be compensated and become consumers, is the fact that is an American citizen loses his job and cannot find one after 90 days… poof, he’s not counted and therefore the unemployment rate increased. Furthermore, if now a foreign person comes into the USA, whether legally or internally, and is employed, the unemployment rate decreases, and it is not really captured that the lower wage the foreigners are willing to take, also further undermines all other wages.
Frankly, we should really be assessing why the heck we are even allowing ourselves to be managed as a vector in a database of numbers like some widget. The only real reason the ruling class cares about the “unemployment rate” is primarily to gauge whether they need to put more bodies on the fire to suppress wages and keep the anxiety and stress of the peasants competing high enough to keep profits maximized.
If it was actually “we need high skilled workers, the ruling class would have done things a long time ago to foster developing high skilled workers over the last 30+ years that they’ve been complaining about that while just using it as an excuse to fall back onto their old ways of importing brown people to suppress wages and to serve them and their decadent lives. “Who will cut our grass and raise our children” they cry out, just like when their slaves we’re taken from them.
It’s called under-employment. It has been widely discussed in the literature but it’s very difficult to measure. Economic statistics do suffer somewhat from a lamplight effect.
Applebees drops prices to enable their employees to eat at Applebees. Margins fall, wages universally clamped to minimum wage, layoffs hit. Fewer Applebees workers with lower wages means a shrinking demand side of the Applebees ouroboros, resulting in a spiral of Applebees price cuts, revenue drops, layoffs. The end state of humanity is a desolate Applebees parking lot strewn with desiccated human corpses and the last person alive is the largest shareholder of Applebees, inside the store, consuming their own flesh.
This is like looking at your revenue numbers and choosing to focus on the number of units sold and disregarding price per unit. The government releases TONS of analysis on wages and wage growth (e.g. the "price per unit"). The St. Louis FRED is a great resource.
I don't blame you. I blame the media for bad reporting. If you dig deeper, I can think of a few reasons why the media would choose to focus on some metrics and not others but I'll leave my conspiracy theories for another discussion.
Why do we care so much if jobs are created or not created? The market is the market, either we need more jobs or we don't. If there are not enough jobs, then what are we going to do? Create more? We're just dressing up socialism in capitalism's clothes. If you want to seriously do capitalism, then there is absolutely no reason to measure employment. If it's zero then it's correct, if it's 100% then it's correct, the number is always correct.
The problem isn't employment. It's food and shelter. Why do we care so much if people have jobs? Because in America you will die homeless and starve without one. The core issue is much further down Maslow's hierarchy.
The food and housing are too expensive so much so that we are now flabbergasted by the reality of the end game of this system, and we're trying to use euphemistic metrics to broom the larger issue (food and a roof) under the bed. The situation is so bad that a large percentage of Americans are absolutely fine dragging anything that resembles economic competition (immigrants) by their fucking ears off the street, mom dad and child, and dumping them in some random country. The larger US population is unable to cede even an ounce of empathy because their wallets are held hostage by a loan-based society/growth-oriented pricing (my house MUST be worth 40% more since I bought it - really? I see.). We're at an inflection point.
This could be a false analogy, but I'll throw it out there. Imagine a startup that cannot sell their product because it simply sucks. Now imagine not coming to terms with that and doing relentless A/B testing and pointing at the data from that. You won't solve shit with that data, go back to the drawing board.
Infinite growth and infinite "go work more and harder" doesn't sound like the path forward for America. This is very much a "work smarter" situation, because you have to be stupid to keep buying that paradigm. The deal we made with capitalism had nothing to do with annihilating our core conscious of feeding and housing everyone. Capitalism was never supposed to eradicate that human virtue and certainly not add a layer of "must have money and must have job" to stay dry/warm and not hungry, and at the very least not be in constant financial anxiety (which is the day-to-day psychological torment the average American faces).
Another way to interpret employment numbers is to simply meditatively say out loud "There's 70k people this month that are on the rails because this society is that cut-throat about money for literally everything, down to the bagel, down to the roof".
----
Anyway, the new bill congress just passed targeted SNAP, so we definitely cut off more people from affordable food. This entire country is going to need something like SNAP for 300+ million Americans in about 10 years, so we'll all get to watch the poetry of this one.
> if there are not enough jobs, then what are we going to do? Create more?
…yes.
> problem isn't employment. It's food and shelter
We track these. And in most places in America, you can get to a place where you can get both for free. Not to the quality most people want. But to a degree that will sustain you.
And in most places in America, you can get to a place where you can get both for free.
I’m speaking about mass scale unemployment and underemployment. Our homeless infrastructure cannot even handle our homeless. The underemployed and underpaid are basically 6 months removed from homelessness without work, so call a duck a duck.
How long can you keep food/shelter without a job? Six months for the average American? If we are going to artificially create jobs, then I recommend we artificially house and food people instead because that’s the core issue. Your average American is freaking scared of everything if they go 6 months without a job, and that’s a problem.
If the market needed those workers and jobs it would have created them at any price, no price would be too low or too high. The reason the market doesn’t conjure up food and shelter for people is because that’s not what it’s for, so it’s best we decouple.
I’m suggesting that a large percentage of Americans are functionally homeless and basically on a weekly food-shelter lease program in our society that can be cut off to them at any time (sorry, capitalism). In America we call this a career, gig, a livelihood.
Forever. That’s how free works. If you can get to an American city, which most American towns will happily help you out with, you can access free food and shelter virtually limitlessly.
> if the market needed those workers and jobs it would have created at any price , no price would be too low or too high
Market failure is real. Rates, regulations and barriers to entry can and do inhibit labour demand formation.
This has been a critique of the figures for decades, but the current numbers are too convenient for the powers-that-be to change into something more reflective of reality. Trust me, spending fifteen months unemployed in the middle of nowhere and with access to raw data helped me understand a lot about the deliberately engineered shortcomings of our current datasets.
It’s in the vested interest of leaders to control the narrative. That’s why we have/had so many regulations that prevent them from doing so.
I think it's even worse, because that single metric, unemployment, is highly manipulatable. Administrations have been known to redefine "employment" in order to make the number look more favorable.
Either way, "full employment" doesn't mean much unless you take into account whether people are actually able to live a stable lifestyle or are burning the candle at both ends just to put food on the table. One of these enables folks to buy nonessentials and fund all those sectors of the economy, the other doesn't.