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Friday, November 06, 2009

No Hope or Change for Unemployed

So the Labor Department just released the unemployment numbers. The rate is now up to 10.2%, it's highest in more than a quarter century.

Back in 2003 and early 2004, moving towards the election season, we were bombarded with blasts at then President George W. about his "jobless recovery" and the 6 percent unemployment rate.

So how will the left spin their recovery that isn't just jobless, but actually shedding jobs? Remember the good old days, when Nancy Pelosi would blast Bush on jobs creation, complaining when only 80 or 90,000 jobs were created in a month? What will she say to President Obama who's touting other news that says we are in a recovery, when 190,000 jobs were lost!

Does anyone remember this graph, that was used to justify the 'stimulus' package earlier this year.

According to the Chart, unemployment should be about around 7.8% since we passed the stimulus. Instead, the number is literally off the top of the chart.

The flip side to unemployment is that our productivity numbers had their biggest jump in nearly a decade. It's normal to see productivity going up before jobs are added, but not at a 9% pace. In fact, it's up enough that people should really be worried about why the jobs aren't showing up.

Why aren't they? Fear in the business sector is the easiest answer. There is currently tons of new regulation on business waiting to be passed in Congress. Business' won't expand until they have a better feel on where things like health care reform and cap and trade are headed.

Here's an example. Say you employ 95 people, and your productivity for them is up 9.5% last quarter. You probably have enough work to add between 5 and 10 new workers. But if the House version of health care reform passes, that would put you at the magic 100 number. Now in 2010 your taxes or benefits package costs will increase greatly, you aren't a "small business" anymore.

So do you hire the workers you need, and hope that you increase profits enough to cover the expenses of not only the workers, but the new health care bill, or do you hold off and see what happens in DC?

If you have 100 workers right now, and know that the House is getting ready for a ramrod vote on Saturday, do you keep what you've got, or get rid of a few folks to get back under the onerous 100?

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Blogger John Ruberry said...

I remember.

5:58 PM  

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