Final thoughts on Employment, via Professor Morici:
"Overall, conditions in labor markets remain mixed. Shortages have emerged for workers with key technical skills. For example, construction, business and information technology services, and health care remain strong for workers with technical specialties.
Meanwhile, workers with only high school or a few years of college, having few specialized skills, faced mounting challenges securing positions offering good pay and health benefits. In the Midwest, the weight of troubles at GM, Ford and their suppliers are felt, and in portions of the Southeast, the continuing woes of the textile and furniture sectors weigh down wages.
It is clearly a “haves” and “haves not” labor market, and these conditions go a long way toward explaining why President Bush cannot convince Americans the economy is on solid ground, even as it demonstrates robust GDP and productivity growth . . .
Overall, manufacturing has lost 3million jobs since 2000, and the patterns of past expansions indicate it should have regained about 2 million by now. The huge trade deficit and overvalued dollar against the Chinese yuan play key roles, destroying jobs in manufacturing and knowledge-driven service industries that pay above average wages. In turn, these conditions suppresses wages in communities dependent on manufacturing and other more established industries, and are an important factor creating a “haves” and “haves not” economy.
Unemployment fell to 4.6 percent largely because more adults chose to not participate in the job market. The adult labor force participation rate remains significantly lower than when George Bush took over stewardship of the economy. If adults were participating in the job market at 2000 levels, 2.7 million more people would be looking for work and unemployment would exceed 6 percent."
Professor Peter Morici
Robert H. Smith School of Business
University of Maryland