Tag Archives: jobs

Demon Oil

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…and its evil carbon footprint. Here, courtesy of Mark Perry, writing for AEIdeas, are 10 examples of the destruction demon oil has wrought in North Dakota.

1. … [I]t took almost 58 years for the Bakken oil fields to produce the first 500 million barrels of oil from 1954 to July 2012; and then, thanks to the shale oil revolution, the Bakken oil fields produced the second 500 million barrels in less than two years—from July 2012 to March 2014!

2. In 2004, North Dakota ranked No. 9 for oil production by state, but then thanks to the shale oil boom in the Bakken, the state quickly rose to the No. 6 spot by 2008, the No. 4 spot in 2009, and then surpassed both California and Alaska in 2012 to become America’s second-largest oil producing state, behind only Texas.

3. … At one million barrels of oil every day, the North Dakota Bakken now produces more oil than entire countries like Colombia, Oman, and the UK.

4. In each of the last 69 months since January 2009, North Dakota has recorded the lowest state jobless rate in the country and led the country as the state with the highest rate of private sector job growth. …North Dakota’s jobless rate has been below the US jobless rate by an average of more than 5 percentage points over the last five years. Over the last 12 months through March, private payrolls in North Dakota have grown by…more than twice the national average of 2.25% in private sector job growth.

5. Over the last three years, the jobless rate in Williams County, North Dakota, in the heart of the Bakken oil fields, has averaged less than 1%, and has been as low as 0.7% in six different months.

6. According to the Conference Board, there were more than twice as many advertised online job openings in North Dakota in March (21,900) than there were unemployed workers seeking employment (10,610)…. At the national level…there are more than twice as many unemployed workers (10,486,000) as online advertised job vacancies (4,894,000).

7. The Census Bureau reported recently that three of the five fastest growing micro areas (cities with populations of 10,000 to 50,000) in the country between July 2012 and July 2013 were in North Dakota [including two of the top two].

8. The BEA reported recently that North Dakota led the country last year with the highest growth in state personal income at 7.6%, almost three times the national average of 2.6% growth….

9. North Dakota has boasted a state budget surplus in every year since 2008, when shale oil brought an unprecedented level of new jobs, wealth and prosperity to the state.

10. This might be the most impressive economic fact about North Dakota…: in 2006, North Dakota was America’s 11th poorest state by personal income per person. In just seven years, thanks the shale revolution, the Peace Garden State rose to become the nation’s 2nd most prosperous state in 2013, ranking behind only Connecticut last year for personal income per capita….

Read ’em and weep.

Byzantine Visas

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In a Wall Street Journal op-ed earlier in the week, Martin Lawler and Margaret Stock wrote about dysfunctional and too low limits on H-1B visas for skilled, educated foreign workers. While on the right track, though, they missed some points.

Some claim there is no shortage of science, technology, engineering or math (STEM) workers, and that US companies hire foreign employees to be “indentured workers” who can be paid low wages. In 2012, David North of the Center for Immigration Studies said, “It is well known that many H-1B workers are, in effect, indentured by employers who had filed to obtain green cards for them—they are nominally free to leave, but it can be hard to keep your resident alien application alive after leaving the employer who set it in motion.”

Lawler and Stock correctly point out the fatuousness of this erroneous claim, but they miss a larger point. Say, arguendo, that North is right. There are two solutions to this, and neither include North’s view of how such foreign workers should be treated. Lawler and Stock addressed the foolishness of the (low) quota for H-1Bs. The other solution is to cut out the nonsense on the green cards: decouple them from visas. Either the green card applicant is suitable, or he is not. His STEM education is only one criterion, and it needn’t be a critical one.

And, in support of the above correction, Lawler and Stock note that

[t]he Labor Department must certify, through a formal process, that H-1B wages are appropriate. Public notices of the jobs, including the wages, must be posted at the work site. The notices must contain specific information about filing a complaint challenging the wage and working conditions. Once the certification is issued, the US Citizenship and Immigration Services conducts a thorough review of the entire case, including details about the employer, employees and positions.

But this misses a larger point, too. Government has no business entering the premises of a private enterprise and dictating to that enterprise who it may hire, at what pay rate, or (within very broad limits) under what conditions.

Full stop.

Labor price should be as competitive as any other good or service price.

Addendum to the Jobs Numbers

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…about which I wrote earlier.

This graph (constructed from the Bureau of Labor Statistics’ Current Population Survey, Table A-1) comes from a report by Senator Jeff Sessions (R, AL), Ranking Member of the Senate Budget Committee.LaborForceParticipationRate_Sessions

Notice that. The labor force participation rate wasn’t affected at all by the Panic of 2008. Quite the contrary, the participation rate’s decline continued unaltered by the Panic—and unaltered by President Barack Obama’s policies. Closely tied to that failure is this: in 2007, just prior to the Panic, 146,273,000 Americans had jobs. As of last February, in the middle of that failed GDP quarter of which I wrote, 145,266,000 Americans had jobs—a decrease of a bit more than 1,000,000 Americans.

And Obama has been on the hustings bragging about that headline unemployment number.

Hmm….

Jobs Numbers

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According to the headlines, our unemployment rate fell to 6.3% in April (from 6.7%); it hasn’t been that low since before the Panic of 2008. This also came as the private sector and state and local governments added 288,000 jobs. Good news, eh?

It is good news, for those 288,000 Americans. However. There’s always a however.

806,000 Americans gave up looking for work in this economy and dropped out of the labor force. The labor force participation rate fell to 62.8% (from 63.2% in March), the lowest rate in nearly 40 years. If this number had only held steady at March’s value, the unemployment rate would be in the 6.7%-6.8% range.

These data also come on the heels of our GDP datum for the first quarter of 2014, which ended in March: GDP grew at the sickly rate of 0.1% over the 4th quarter 2013.

The jobs report turns out to indicate a fine beginning for the second quarter of 2014.

Jobs and Income in the Current “Recovery”

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AEIdeas‘ James Pethokoukis has some data in his article, “Obama’s low-wage jobs recovery.” He talked about the type of jobs being…created…in this so-called recovery; the graph below highlights his point.NetChangeEmployment

There’s another aspect to this, though, and that’s the income implication of the type of jobs being created. I constructed the table below from the data in the graph above, using the mid-points of each industry type wage range and assuming a 2080 hour work year—that is, everyone, even the low-wage industry worker, either works all 52 weeks of the year or gets paid in full for vacation time, including holidays, to keep the arithmetic simple.

Wage Mid-Point Jobs Lost (Thousands) Jobs Gained (Thousands) Not Jobs Gained (Thousands) Net Annual Wages Gained/Lost (Thousands $)
High Wage: $26.3250 (3,579) 2,603 (976) ($53,441,856)
Medium Wage: $16.8650 (3,240) 2,282 (958) ($33,605,874)
Low Wage: $11.4050 (1,973) 3,824 1,851 $43,910,162
Total: ($43,137,567)

You’re reading that right. The only net gain in income is in the low end industries; these folks, by being able to go back to work, have gotten a net increase of some $44 billion in their annual income. But that’s swamped by the losses in the other two categories, and the nation as a whole has lost some $43 billion in annual income.

This is a fine recovery, yes, indeed.