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Unemployment Question


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The unemployment rate is how many people are applying for unemployment funds.   Many of those not working now aren't eligible because they are doing work at home or because they are the gig economy or something else that removes them from unemployment financial support.

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The increased death rate due to Covid and many older workers using the pandemic break to retire.

Covid also did a number on more menial jobs.  A fair number of those with such jobs got a chance to not have soul-crushing jobs and tried to transition out of them and quite a few succeeded.

Many employers are refusing to accept the new lowered supply compared to demand and want to pay the old low wages and people aren't biting. Then business owners go on TV and complain about how lazy people are for not wanting to be exploited and how people are quitting whenever they find a better offer which is happening a lot. They need to pay more and/or treat their employees better. Employers got lax when they could easily fill any job. Now it is time to adjust and realize the labor market has more power now.

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8 minutes ago, The Nehor said:

 

Many employers are refusing to accept the new lowered supply compared to demand and want to pay the old low wages and people aren't biting. Then business owners go on TV and complain about how lazy people are for not wanting to be exploited and how people are quitting whenever they find a better offer which is happening a lot. They need to pay more and/or treat their employees better. Employers got lax when they could easily fill any job. Now it is time to adjust and realize the labor market has more power now.

This isn’t true where I’m at. Fast food places are paying $12-15 an hour for new hires. Pre Covid it was $8 standard. I was paid $10 an hour to work with high need autistic adults while going to college only 3 years before. Yet everyone is still trying to hire.

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16 minutes ago, Fether said:

This isn’t true where I’m at. Fast food places are paying $12-15 an hour for new hires. Pre Covid it was $8 standard. I was paid $10 an hour to work with high need autistic adults while going to college only 3 years before. Yet everyone is still trying to hire.

And if they still can't fill the position the pay needs to go up more. Or the benefits. Or whatever. The laws of economics don't show mercy and meet you halfway because there was a jarring change.

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Posted (edited)
20 hours ago, Fether said:

How is it that unemployment is so low… yet there is such a large shortage of workers (particularly in the food sector and other cheap labor industries)

The answer is in the question. Low unemployment is correlated with labour shortages. Put another way, everyone who wants a job has one, so employers looking for additional workers can't find one. The inverse is also true - during periods of high unemployment there are generally no labour shortages (this is a bit of an over-generalization - it varies by sector) because there is a large pool of people looking to find work and employers can more easily find one.

If it is a closed or mostly closed labour market (i.e. insufficient immigration) then employers will raise wages or they will mechanize their outfits.

Edited by halconero
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Posted (edited)
49 minutes ago, halconero said:

everyone who wants a job has one

Ish. When considering unemployment stats, I mentally add 20% (eg:4% unemployment = 24% unemployed) to reflect the actual count of 16-64 who don't have full/part time employment. That 20% includes people without usable transportation, who have health issues that don't align with employers' preferred job demands, who are hamstrung by competing responsibilities (family care, etc). The 20% also includes people who can't get past hiring portals' auto-discriminating algorithms  (eg: against those w/o employment history, w/ minor criminal records, past liked age).

Edited by Chum
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1 hour ago, Chum said:

Ish. When considering unemployment stats, I mentally add 20% (eg:4% unemployment = 24% unemployed) to reflect the actual count of 16-64 who don't have full/part time employment. That 20% includes people without usable transportation, who have health issues that don't align with employers' preferred job demands, who are hamstrung by competing responsibilities (family care, etc). The 20% also includes people who can't get past hiring portals' auto-discriminating algorithms  (eg: against those w/o employment history, w/ minor criminal records, past liked age).

By definition the unemployment rate captures those who don't have full/part-time employment because of the reasons you cited, but are actively looking for it. Now, if you mean those who are discouraged looking for work due to transportation, health, family, age, work, or criminal issues or histories, then yes, I think that is reasonable. Add about 15% or so for the student-age population between 16-25 and you're able workout why unemployment can be around 2% while labour force participation is between 62-65%

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