The June unemployment situation, as depicted by the Bureau of Labor Statistics in its July 5 report, looks like May redux: Unemployment rate stuck at 7.6%; number of persons unemployed stuck at 11.8 million; number of persons unemployed for at least 27 weeks stuck at about 4.3 million or 36.7% of all unemployed persons. Even the increase in the number of persons employed (195,000 vs. 175,000 in May) was far too small to force a change in the long term trajectory of job creation, which has averaged 182,000 per month over the last year.
This Lesser Depression has, indeed, been devastating, especially for the less educated, for African Americans, and for Latinos. After 4 full years of economic “recovery” the number of unemployed persons is still 5 million greater than it would be if the unemployment rate had dropped by now to its eve-of-Lesser Depression low of 4.4% (May, 2007.) And it should be noted that 4.4% unemployment is higher than its historic lows and probably does not represent “full employment.”
On July 3rd, CEPG’s Ron Baiman provided testimony before a group of Illinois lawmakers serving on a special Pension Conference Committee regarding the state’s underfunded pension plan.
Baiman presented findings in collaboration with research from CPEG’s Bill Barclay regarding potential solutions to Illinois’ structural revenue problem including closing huge tax loopholes, a financial transactions tax, and a graduated individual income tax. The powerpoint referenced in the video can be downloaded here.
Every Month a CPEG member will be posting a brief issue analysis for discussion and comments. This month’s discussion piece was authored by CPEG’s newest member, Luis Diaz-Perez. A little more about Luis can be found in the “About Us” section of our site.
A college education was once synonymous with self-advancement and independence. Now, a college degree might be more appropriately associated with debt and dependence. Individual lives, not to mention national growth and development are being buried beneath $1 trillion of student loan debt. This calamity, already greater than American credit card or car loan debt, is scheduled to become even more pitiless after July 1. That’s when interest on federal student loans doubles to 6.8%. But this piling on doesn’t have to be. Thanks to Sen. Elizabeth Warren’s first stand-alone bill, S897 – the Bank on Students Loan Fairness Act, a remedy is at hand that doesn’t just attack the metastasis, it also offers a prescription for broader economic wellness.
The labor market remained sluggish in May. Unemployment rose from 7.5% to 7.6%, while nonfarm payroll increased 175,000. Much of the job growth was concentrated in retail, food services and drinking places and temporary help. Manufacturing fell slightly.
The growth in employment is at about the same rate as has characterized the economy over the last year. This rate is simply not enough to make headway against the huge damage done by the financial panic and recession that started in late 2007. The key measure of labor market health, the employment to population ratio remains stuck at 58.6%. That ratio has been at this level since 2010. On the eve of the recession the employment to population ratio was over 63%. In the 2001 recession this measure never fell below 62%. The economy remains in deep trouble. We are treading water. Growth is barely covering population increases. The human cost of the recession continues. The simple logic of the numbers is that we have made no progress.
This is a crosspost from the “Dollars & Sense Real World Economics” Blog, authored by CPEG’s Ron Baiman.
It’s been interesting following the recent press on corporate tax avoidance, and in Chicago, the ignominious public school closings. I thought it would be useful to take a minute to draw out the linkages.
The biggest revelation from Apple’s tax avoidance strategy has been it’s scheme to set up “corporate persons” who don’t reside anywhere.1 Apple set up an Irish subsidiary incorporated in Ireland (and therefore not liable for U.S. corporate taxes) but managed from California (and therefore not subject under Irish law to Irish taxation) that has rights to the income from all of the companies trademarks and patents in Asia, Africa, and Europe. Presto! This special corporate person is not legally liable for any taxes – a step up from the usual multinational “transfer pricing” and “off-shore” tax haven strategies where the poor “corporate person” still has to at least have a place of residence!