June BLS Report, and the Next American Worker Displacement Wave

By Joe Guzzardi
July 12, 2016
 
The June Bureau of Labor Statistics jobs report was, as usual, misleading. Headlines in the financial press touted the 287,000 jobs that the economy created as a welcome relief from months in the doldrums. But a quick look at the full report showed that while jobs were more plentiful than in recent months, they were mostly low-paying, part-time, and not of the quality that would allow American workers to significantly upgrade their life styles. Job creation in better paying sectors like manufacturing and mining were mostly flat.
 
In its sober analysis of the June BLS report, the Economic Policy Institute (EPI) offered a more revealing snapshot of what’s truly going on in the U.S. labor market. The picture EPI drew is ugly. EPI has developed a “missing workers” category that this month total 2.6 million. Because of weak job opportunities, the 2.6 million are neither employed nor actively seeking a job, and are therefore excluded from the BLS survey as unemployed. If those missing workers were included in June’s tabulation, the unemployment rate would be 6.4 percent instead of the official 4.9 percent rate. Excluding unemployed, non-job seeking working-age people has led critics like Gallup CEO Jim Clifton to call the official government rate “the big lie.”
 
Moreover, being employed means little when workers’ wages aren’t high enough to pay bills. The New Republic’s David Dayen coined a new term to refer to soaring number of temporary workers, contractors, freelancers, and other among the involuntarily self-employed, some of whom hold multiple jobs just to make ends meet. Dayen calls it “the 1099 economy,” a reference to the Internal Revenue Service forms given to non-employees. This amalgam of 1099 economy workers grew from 10.1 percent in 2005 to 15.8 percent at the end of 2015, an increase of 9.4 million workers which represents the total labor market growth over the last decade.

As a predictable result of the 1099 surge, corporations have reduced permanent staff, replaced full-time employees with temporaries, and freed themselves from the financial responsibility of paying tens of millions to its workers in health and retirement benefits, overtime, holidays, sick days, disability and workers compensation. Today, individual workers have to finance their own safety nets, a mounting and often insurmountable challenge.
 
At a time when U.S. workers need all the help they can get, the White House is actively subverting them. Recently, President Obama announced that he’s launching a “Call to Action” to major corporations to hire more refugees as they resettle across America. Among the participating companies are the nation’s most prestigious that any of EPI’s 2.6 million missing workers would eagerly work for: Accenture, Airbnb, Chobani, Coursera, Goldman Sachs, Google, HP, IBM, JPMorgan Chase & Co., LinkedIn, Microsoft, MasterCard, UPS, TripAdvisor, and Western Union. Chobani’s workforce is already 30 percent refugee, and Goldman Sachs has committed $10 million to help refugees learn employment skills that can be used to displace Americans.
 
Because of political sleight of hand, the new refugee wave will not be counted against the 85,000 refugees, also work authorized, the administration has previously committed to. Instead, an unlimited number of refugees will be admitted on employment, training or student visas.
 
American workers can’t survive the double-barreled assault the Obama administration and big business is waging against them. For the White House to infer that unemployed or marginally employed Americans wouldn’t work at Wall Street titan Goldman Sachs or tech giant IBM inexcusably kicks them when they’re already down, and adds to the growing mainstream discontent with the political and corporate elite.                                                                                                     

 
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Joe Guzzardi is a Californians for Population Stabilization Senior Writing Fellow. Contact him at [email protected] and follow him on Twitter @joeguzzardi19.