Economy

The Bad Employment News Keeps On Coming

The unemployment rate in Pennsylvania peaked at 8.8% in April 2010 before steadily declining to 7.4% in May of this year. Then mounting public-sector job losses pushed unemployment back up to 8.3% this September.

Tuesday’s release of September unemployment data contained some good news in that the unemployment rate fell in September in 60 counties and in every metropolitan area in the state.

Morning Must Reads: We Know What to Do about the Economy, We Just Lack the Political Will

On Sunday, economists Christina and David Romer urged more aggressive action by the Federal Reserve and by Congress to boost short-term growth, noting in particular that we have the tools necessary to lessen the extent of unemployment in the economy but lack the political will do what is needed.

[David Romer said:] 'We need long-term measures to reduce the deficit over time and short-term measures' — like infrastructure spending — 'to help the shortfall in demand.'

While welcoming President Obama's jobs plan (which has yet to pass congressional muster), [David Romer] said it 'falls far short of filling the jobs gap.'

'The American economy is fixable,' he concluded. 'But the real constraint is building the political will and public support.'

In his New York Times column this morning, Paul Krugman notes the reemergence of a double standard in which many conservatives consider military spending critical to job creation while openly denying that other kinds of government spending create jobs in the economy.

Third and State This Week: Income Inequality, Funding Woes for Schools and Transit, and a Citizens' Take on Shale

This week, we blogged about rising inequality, the financial troubles of public schools and public transportation, and the recommendations made by the Citizens Marcellus Shale Commission.

IN CASE YOU MISSED IT

  • On the Marcellus Shale, Mark Price blogged about the Citizens Commission report, which found that Pennsylvanians believe gas drilling has moved too quickly and that public officials need to do a better job protecting their communities and environment. Chris Lilienthal also highlighted the report along with a recent press conference where lawmakers from both parties called for drillers to pay their fair share.
  • On inequality, Stephen Herzenberg shared his response to the speech on income inequality that U.S. House Majority Leader Eric Cantor never delivered. The Congressman canceled his planned speech at the University of Pennsylvania last week after learning that the event would be open to the public. Also, Mark Price summarized new data from the Congressional Budget Office showing that the after-tax income of the richest 1% nearly tripled between 1979 and 2007.
  • On jobs and unemployment, Mark Price provided a rundown of Pennsylvania's September jobs report, which showed a loss of just over 15,000 jobs last month.
  • On state budget and taxes, Mark Price wrote about legislators' attempts to create a tax loophole for the sale and service of airplanes, while Pittsburgh's Port Authority remains significantly underfunded. Mark also pointed out that while Philadelphia schools are faced with further budget cuts, elected officials are considering a school voucher program that would drain even more revenue from public school classrooms. 

More blog posts next week. Keep us bookmarked and join the conversation!

A Response to Eric Cantor on Inequality

Last Friday evening, I was asked to lead a Saturday afternoon "teach-in" on inequality to Occupy Harrisburg. Shortly after receiving this request, I got an email about a talk on income inequality that Eric Cantor, the Majority Leader of the U.S House of Representatives, had been scheduled to give Friday at the University of Pennsylvania.

Cantor canceled his talk at the eleventh hour, saying that he had only just learned his lecture would be open to the public. Cantor's prepared remarks, however, were published by The Daily Pennsylvanian.

Cantor’s remarks were a refreshingly honest discussion of opportunity in America and what he, a leading conservative, has to say on the issue. So I decided to make my introductory remarks to Occupy Harrisburg a take-off on and response to Cantor’s text. See who you think gets the better of the argument by reading my remarks and Cantor’s.

After I delivered my prepared remarks, I spent an hour in a very enjoyable back and forth with the audience. In my experience giving talks and teaching students at leading universities, I have rarely met such an informed and thoughtful group.

Morning Must Reads: Jobs Down, College Tuition Up, School District Taxes Up and Policy Makers Are Focused On What?

On Tuesday, the Keystone Research Center published a summary of the employment situation in Pennsylvania. With the release of September's jobs data, which included a loss of just over 15,000 jobs, a picture is emerging of a job market in Pennsylvania that is shrinking. The continued loss of public-sector jobs and relatively slow growth in private-sector jobs is the main source of weakness in the labor market. The bottom line is that although Pennsylvania ranked in the top 10 of states in terms of job growth early in this recovery, the Commonwealth has moved to the bottom 10 in the last five months.

Much of the public-sector job loss is driven by the fact that tax revenue has yet to fully recover from the recession, the end of federal Recovery Act funding, and state lawmakers' unwillingness to raise state revenues which has deepened state budget cuts.

In related news — stemming from state budget cuts in funding for higher education — The Pittsburgh Post Gazette this morning reviews the latest on tuition costs at colleges and universities in Pennsylvania.

The average cost of tuition and fees at a public four-year college in Pennsylvania grew by 7 percent, from $11,331 last fall to $12,079 this fall, the College Board said. That's an average increase of $748.

Pennsylvania's average cost of $12,079 for four-year public college tuition and fees puts it behind only New Hampshire at $13,507 and Vermont, $13,078.

In K-12 education, local school districts are looking to compensate for state budget cuts through increases in property taxes. 

Third and State This Week: Rising Unemployment, a Health Insurance Rate Hike and Momentum for a Drilling Tax

This week we blogged about momentum building for a natural gas drilling tax and rising unemployment in Pennsylvania. We also featured a guest post on the need for stronger insurance rate protections in Pennsylvania. And Mark Price kept us up to date with the Morning Must Reads.

IN CASE YOU MISSED IT

  • On jobs and unemployment, Stephen Herzenberg shared his media statement on the rising jobless rate in Pennsylvania.
  • On the Marcellus Shale, Sharon Ward highlighted a recent New York Times article on the problems that have come with Marcellus Shale growth in Pennsylvania. Kate Atkins urged readers to sign a letter to lawmakers in support of a drilling tax that would generate revenue to improve schools, fix roads, train workers, and protect the environment.
  • On health care, Athena Ford of the Pennsylvania Health Access Network penned a guest post on the need for better insurance rate protections in Pennsylvania.
  • Finally, Mark Price had Morning Must Reads on the economic polarization of the 99%, the need for more accountability in charter schools, how we can boost the economy, and what budget cuts and layoffs have in common.

More blog posts next week. Keep us bookmarked and join the conversation!

Losing the PA Advantage as Unemployment Rate Climbs

I put out a media statement today on Pennsylvania's September jobs report, which showed the state's unemployment rate has risen to 8.5 percent.

“The number of jobs in Pennsylvania fell by 15,800 in September, over half of which was a 8,300 drop in government jobs. In another troubling indicator, the number of manufacturing jobs in the state fell for the first time in 10 months, a further sign that declines in public-sector employment are dragging down the private economy.

"Since May, the Pennsylvania unemployment rate has increased by nearly a percentage point, from 7.4 percent to 8.3 percent, while the U.S. unemployment rate has held steady at 9.1 percent. While the difference between the U.S. and state unemployment rates — the ‘Pennsylvania Advantage’ — fluctuates a lot on a month-to-month basis, this gap has been smaller than the current 0.8% in only one month since 2009.

"The September report demonstrates yet again that Pennsylvania and the nation need a jobs plan. Policymakers have been sitting on their hands for the past two years and Pennsylvania families are paying the price."

Morning Must Reads: Budget Cuts and Layoffs

Later today, the Pennsylvania Department of Labor and Industry will release the state's September job numbers. The Philadelphia Federal Reserve is forecasting (PDF) the unemployment rate in Pennsylvania will rise a tenth of a percentage point to 8.3% in September. If that forecast holds up, the unemployment rate in Pennsylvania will have risen by nine-tenths of a percentage point since May. Based on this morning's headlines, we can expect more bad news in the months ahead.

Philadelphia-based Checkpoint Systems Inc. announced plans to expand a restructuring program to cut expenses and jobs.

The maker of anti-theft devices for retail chains said its new plans would affect 1,000 existing employees, up from the 204 in its original scheme. Checkpoint said it had 'already taken steps to eliminate three senior executive positions' and intends to 'aggressively take out layers of management.'

In addition, Checkpoint plans to close four production facilities, but did not specify where in its news release.

While job creation in the private sector remains weak, the public sector continues to make the problem worse mostly by punishing the most vulnerable in our society.   

Morning Must Reads: Bailouts for the Banks and Cake for the 99%

What is good for the financial sector is good for the 99% 1%.

For the financialization of America wasn’t dictated by the invisible hand of the market. What caused the financial industry to grow much faster than the rest of the economy starting around 1980 was a series of deliberate policy choices, in particular a process of deregulation that continued right up to the eve of the 2008 crisis. Not coincidentally, the era of an ever-growing financial industry was also an era of ever-growing inequality of income and wealth. Wall Street made a large direct contribution to economic polarization, because soaring incomes in finance accounted for a significant fraction of the rising share of the top 1 percent (and the top 0.1 percent, which accounts for most of the top 1 percent’s gains) in the nation’s income. More broadly, the same political forces that promoted financial deregulation fostered overall inequality in a variety of ways, undermining organized labor, doing away with the 'outrage constraint' that used to limit executive paychecks, and more.

The Pittsburgh Post-Gazette reviews employment law in Pennsylvania and notes that there are two sets of rules, the rules for the rest of us (we are employed at will and rarely get a severance) and the rules for top executives.

Third and State This Week: Gloomy Economic News, Trade Agreements and Tracking Salaries

This week, we blogged about the need for a jobs plan, an effort to make labor markets more transparent, and the negligible effect the recently passed trade agreements will have on reducing joblessness. Plus, the Friday Funny is back, with the warm words of everybody's favorite CEO, T. Herman Zweibel (extra points, if you know who that is without looking him up).

IN CASE YOU MISSED IT

  • On the recession and recovery, Mark Price addressed a Patriot-News editorial that calls for passage of the American Jobs Act but misstates the important impact that the Recovery Act of 2009 had on turning the free-falling economy around. Mark also blogged about some of the awkward facts that make it difficult to root for GE and other multinationals.
  • On unemployment and the economy, Mark compared a poll performed by the Mercyhurst College Center for Applied Politics with labor analysis done by the Keystone Research Center — both finding that roughly 1 in 4 Pennsylvania residents have had less paid work than they wanted during the last 12 months.
  • In other economic news, Mark blogged about Congress' failure to address the lack of consumer demand that is keeping unemployment high and its passage of a free trade agreement that will have a negligible impact on U.S. employment.
  • On wages and the workplace, Chris Lilienthal blogged about an online project aimed at creating a more transparent labor market. You can share and compare salaries and wages, understand your rights on the job, and look up the salaries of politicians, CEOs, athletes, and Hollywood stars.
  • Lastly, a bit of humor after a gloomy news week. Chris shared some satire from The Onion's publisher emeritus, T. Herman Zweibel, who is shocked that his repeatedly mistreated employees are in disbelief that he would move their offices to the Yukon.

More blog posts next week. Keep us bookmarked and join the conversation!

Syndicate content