Unemployed Per Job Opening

http://economix.blogs.nytimes.com/2011/03/11/5-unemployed-for-every-job-opening/?emc=eta1

http://economix.blogs.nytimes.com/2011/03/11/economic-blind-spots-left-and-right/?emc=eta1

A new report from the BLS shows that there were 5 unemployed for every available job in January. This ratio has been the same for several months. It's lower than it was two years ago when it was 7 workers per job opening during the height of the Great Recession. The chart from the BLS and Haver Analytics on our first attachment shows the trend.

5 unemployed per opening is bad. It's not an "improvement" from 7. It's bad.

If we go back to December, 2006, the ratio was about 1.5 to 1. Or even that period between June and December of 2003: the ratio was just under 3 to 1. In December of 2,000, it was almost 1 to 1.

If the numbers for layoffs are down, then what are we dealing with? The answer is the very slow pace of job creation. That's because, as Alan Blinder predicted, we've shipped jobs overseas and they're not coming back. The jobs not being created here are being created elsewhere or are gone.

As Catherine Rampell points out, job openings are about 36% below the level when the recession began three years ago. Basically, there's been no job market improvement over the last few years.

So, hiring is happening, but not enough. I think it was Paul Krugman who said we need to get back to a U.S. hiring rate of more than 300,000 jobs per month and sustain it for more than 5 years just to get back what we've lost.

Our second attachment is a classic from David Leonhardt on "Economic Blind Spots" for the left and the right.

Looking at the list, I'm not sure which I am since I see myself on some points in both but it's more fun to look at the blind-spot list for the right:

* Tax rates are the main determinant of economic growth. (Really?)
* The rich will always figure out a way to get around tax increases. (By contributing to worthy charities?)
* The United States has the world's best health care across the board. (How about the "coverage?")
* The free market is the answer for health care. (Really?)
* The free market is the answer for everything. (Really?)
* Illegal immigrants are a major economic problem. (Check with those who know demographics.)
* Global warming is a matter of debate. (We had more extreme weather before mankind arrived.)
* Inequality isn't a problem. (For whom?)
* Life is worse today than it used to be. (Tell that to the 400 million people in China who have been lifted out of poverty.)

Leonhardt has an excellent perspective on all this: "... conservative economists' blind spots overlap more with general conservative blind spots than is the case for liberal economists and liberal blind spots. That's not a value judgment so much as an observation: liberal economists tend to be more economically conservative than liberals."

Economists in general need to do better!