Saturday , May 30 2020
Home / David

David



Articles by David

ND Wages and Unemployment Benefits

1 day ago

There are lots of stories around unemployment benefits and the good or bad aspects of the policy enacted through the CARES act, specifically an additional $600 in benefits per week. Why that dollar value in particular? There was an intent to make it more of a locally based number, but that quickly became an intractable problem that would delay, arguably needlessly, necessary aid. As a result the legislation used more of a national average number. The upside is it should help maintain some level of demand with more funds in the hand of people. The downside is that it might disincentivize a return to work, though this would be region and job specific and involves some short run versus long run issues.

This is a bigger issue being tackled nationally. Jamie Dimon of J.P. Morgan

Read More »

Different Looks at Initial Claims in ND

9 days ago

While there are no shortages of economic issues to tackle these days the circumstances surrounding unemployment get a great share of the attention. I am not going to argue with that given the difficulty I have envisioning an economy doing “alright” with 20 million unemployed. Since the claims numbers sky rocketed people ask me less frequently (yes, that is less frequently, not stopped asking) if we are in a recession. It is also the case that the fiscal policy arguments right now in Washington are more of a fight over how or whether to assist unemployed people and get an economic recovery started.

The labor constraint in North Dakota is a real phenomenon and at times represented a huge loss of potential output and income for the state. The sub-optimal level of employment did

Read More »

Initial Unemployment Claims – Week 9

16 days ago

Writing this update as I am on the radio so being very quick with it, but I was able to get the new week’s numbers for initial claims processed.

The big takeaways are the high level, but slightly lower level of claims, in accommodation and food service sectors. In addition, the mining percentage of claims is up a bit again, just shy of 11% of claims since the start of COVID-19 issues in North Dakota. The second highest category continues to be health care and social assistance. On health care think elective procedures and the like, not necessarily essential workers like nurses.

I will prep a better look across the time span in the next few days to try to break this out for industries.
Share this:

Related

Read More »

Updated Initial Claims Data-Week 8

16 days ago

North Dakota continues to see higher than typical initial claims data and they will be updated on Thursday. Here is the change in overall percentage of claims by sector from week 7 to week 8 (these are the weeks of observations since the first reported case of coronavirus in North Dakota).

The two takeaways from this graph for me are the decline in the percentage attributable to the accommodation and food service sector and the increase in the mining sector share. These are small changes to be sure, but as the process matures in the state so does the response of the different industries.

One of the significant problems remains the economic impacts of the virus impacts beyond the state. Those impacts challenge the supply chain nationally, which puts all states, including

Read More »

ND Outlook – Some Tax Data

23 days ago

There is so much left unclear right now that the outlook seems to change significantly on a daily basis depending on how we work in the latest information into the models. What is clear is that we probably have not seen the end of the use of the term “unprecedented” when applied to the economic circumstances of the nation or the state. There are some reasons to believe we have a better situation in place than many other states, but I think most people realize this can change very quickly.

Critical factors in these scenarios are the pace of recovery, not just locally but nationally. There are two major disruptions to consider, and they are correlated. We have an enormous demand shock right now impacting sectors in asymmetric fashions. That is creating a massive supply chain

Read More »

Class Unemployment Rate Forecast

23 days ago

I had my class predict the unemployment rate. They were free to guess, read a survey of news articles, listen to the television, or run a model. We pretty much had all of the above approaches followed. So the big reveal.

The class average forecast for the unemployment rate was 19.2%. These students have been pretty impressive these last months. I will not say I know all they are dealing with, but what I do know says they have some serious resolve. They got their work done, kept challenging me with questions, and kept pushing the class forward. It lets you know that no matter how long “recovery” takes, and regardless of what the “new normal” is, we can get through it.
Share this:

Related

Read More »

Back to Posting

23 days ago

David

Economist and economic historian with an interest in population analysis and demographic methods. Especially interested in natural disasters and disruptions to economic activity and changes in population dynamics, as well as fiscal and monetary policy with forecasting implications. Husband, father, Cubs fan.
View all posts by David

Read More »

The Survivors’ Luxury

April 23, 2020

I see no problem with a debate about when we can reopen major parts of the economy right now. I think the debate needs to deal more in the realities of the situation we face regarding infections than an arbitrary calculation of the costs of economic closures and the cost of lives.

The fact is the scale of this threat is really outside the experience of most of us, including those in positions of policy authority. So I would not suggest there is a balancing act going on right now between loosening restrictions on distancing, and thereby re-opening parts of the economy, and the risks of further loss of life as a result of increased exposure. I do not think we should pretend that we could even somehow find a balance between the two sides of this discussion because in many ways it

Read More »

Whatever is reported for ND unemployment rate, the real number is worse.

April 16, 2020

The March unemployment rate will be released Friday, and unlike previous releases this report is likely to be outdated as soon as it is printed. According to the Bureau of Labor Statistics, February had 9,035 unemployed and a labor force of 404,494 in North Dakota. That was an unemployment rate of 2.2%. The report only covers events from a single week, the one that includes the 12th of the month which is again why it is horribly outdated. North Dakota did not report a case of COVID-19 until March 11 and so the bulk of business changes occurred after the survey date.

Add to this that the labor situation in North Dakota has always been difficult, mostly due to a labor constrained economy. This typically meant more jobs than people to fill them. With distancing guidance in effect

Read More »

Updated Occupational Distribution Data, 9 April 2020

April 9, 2020

David

Economist and economic historian with an interest in population analysis and demographic methods. Especially interested in natural disasters and disruptions to economic activity and changes in population dynamics, as well as fiscal and monetary policy with forecasting implications. Husband, father, Cubs fan.
View all posts by David

Read More »

Occupational Distribution of Initial Claims in ND

April 9, 2020

Along with the geographic distribution of initial unemployment claims one of the other interesting aspects to examine is the distribution of the claims within the different occupational categories in North Dakota. One of the reasons this would be important from a policy perspective is that it provides some information about the degree of output lost that may not be recovered. To put it bluntly not all losses are permanent losses. The sales lost by a restaurant are unlikely to be recovered, at least in the way a manufacturer might put on extra shifts to make up for lost production time. In the same way a retail store may see a different timing pattern to purchases but over a longer period of time notice little to no change in the overall sales they make. As a result of these

Read More »

Initial Unemployment Claims in ND

April 9, 2020

I fully recognize that by the time this is posted and read there will be an updated data point for us to consider but that is the nature of the time constraints these days.

There are serious concerns about the state of the economy in North Dakota, and with good reason. Seasonal flooding, retail fallout from social distancing, and oil price collapse are the major issues at play right now. Any one of these could be a major problem on their own, and to deal with them all at one time is a particularly difficult combination to address. One of the ways we can cut through this is to try to limit the focus.

To start we should recognize the relatively recent nature of the problems. If we go with the first confirmed case of COVID-19 in North Dakota on March 11 that gives us less than

Read More »

Morning brief: Oil Jawboning, Cellphone data for social distancing

April 3, 2020

A family member’s word-a-day calendar yesterday was “jawboning” and that was apparently what the President was doing related to oil markets and Russia and Saudi Arabia (New York Times link). I will not say that is not a surprise, nor that it is unwarranted. What remains to be seen is if it works. In the past some Presidents could get away with such an announcement and force the desired outcome, but that does not seem to be the world we live in right now.

I am a bit skeptical of some of the data coming out about cell phone use and social distancing (see this story). In particular when you look at the situation with states like North Dakota I do not think there is adequate consideration of changes in behavior, nor the underlying population density at the start. In addition,

Read More »

Morning Brief: Radio today, Unemployment Claims

April 2, 2020

I will be on the radio this morning. I think unemployment will be a topic of conversation. US claims continued their rise from 3.3 million last week to 6.6 million this week. You can read articles in (Marketwatch link and the New York Times link).

In North Dakota the Governor announced claims so far this year already exceeded last year’s total. The number from two weeks ago was 5,976 and the number released today (which is for the week ended March 28, 2020)is 12,591. Pretty large numbers that are sourced from several causes and likely to continue in the same pattern.

My quick take: I think Congress will be taking more action sooner rather than later with the speed of layoffs. The changing nature of production makes it easier to layoff workers now than in the past because, I

Read More »

Retail Pull Factors and Shutdown

April 2, 2020

Where social distancing and other factors will have a significant economic impact? The easy answer is: everywhere. That, however, is not very helpful for an answer. For any kind of policy discussion and response you need a better answer, or at least the start of one. It is also important when North Dakota has so many factors at play: flooding, oil price issues, and social distancing. So I looked at the retail pull factors in 2019 as a sign of regions most susceptible to decline.

This is the average for the entire year (Q1-Q3 only available now). Not too much of a surprise that the Bakken region is high in this regard. What this means to me is that they are more set up for a large fall. The pull factor is identifying counties with per capita retail sales above the state average.

Read More »

What does a shutdown look like?

March 26, 2020

Maybe it is a good thing but I find many people struggling to understand what an economy under such tight restrictions looks like. The issue is both in the physical world and the data. Well the first one happened already with plenty of news footage showing closed shops, empty streets in metro areas with populations in the millions (cue the tumbleweed), and so on. We have yet to see this manifest itself in the data though. That ends tomorrow.

I am fortunate, if that is an appropriate word here (wait for it), that I studied the economics of natural disasters. Disasters occur in time and space and impact all aspects of life, including and especially the economy. In some cases it leads to radical declines in economic activity. This is clearly something most have difficulty

Read More »

Is $2 Trillion Enough?

March 25, 2020

I have yet to see the actual text of the legislation but I am looking at the news reports of what is included and I have doubts this will be enough. It is good though to see, finally, a fiscal response from the federal government.

Cash payments will be a backstop for many but the small business sector seems at significant risk. The small business loans are being termed more “grants” thank loans and that is good, but the time it takes to get them will be a key issue and I remain unconvinced it will find the smallest of the businesses.

The billions set aside for hospitals seems like it might be inadequate given the pace of spread in metro areas. That may need a specific and prompt revisit even if other aspects do not.

At roughly 10% of the US economy the answer is this is

Read More »

On Point of View (KVLY-TV, Fargo)

March 19, 2020

David

Economist and economic historian with an interest in population analysis and demographic methods. Especially interested in natural disasters and disruptions to economic activity and changes in population dynamics, as well as fiscal and monetary policy with forecasting implications. Husband, father, Cubs fan.
View all posts by David

Read More »

Oil and the North Dakota Sales Tax Outlook

March 19, 2020

The continued decline in oil prices raises the prospect of further budget issues in North Dakota. This is distinct from the COVID-19 related issues that may be hitting the state too. Recall the great declines in the 2015-17 biennium compared to the 2013-15 biennium.

There is a bit of nuance to this situation. There was an enormous price decline for WTI from $105.79 in June of 2014 to an eventual low of 30.32 in February of 2016. More recently we witnessed a price decline from $63.27 on January 6, 2020 to $21.86 today. The price drop is drastic and important for budget reasons related to oil taxes. There is however another issue.

Another portion of the issue comes from the labor force employed in and around the oil economy. These workers buy significant amounts of goods and

Read More »

Age Distribution and Epidemic Risk in North Dakota

March 16, 2020

Governor Doug Burgum gave a great discussion of the state of the problems in North Dakota right now during his March 15 press conference. The key point is the potential rate of transmission and the possible overwhelming of health care services. The fact is older Americans are more at risk (at least right now) from the disease. So the question many ask is, “Why close schools?”

I think I can explain it in just a few maps. This first map shows county population over age 65 in a given county as a share of the total state population.

The concentrations are not surprising and are not the main point to highlight. Look at the county population under age 18 as a share of total state population in this second state map.

You are correct. Except for the scale the maps seem pretty

Read More »

Live Blogging Radio Show ~ 12 March 2020

March 12, 2020

David

Economist and economic historian with an interest in population analysis and demographic methods. Especially interested in natural disasters and disruptions to economic activity and changes in population dynamics, as well as fiscal and monetary policy with forecasting implications. Husband, father, Cubs fan.
View all posts by David

Read More »

Will be on the radio today

March 12, 2020

David

Economist and economic historian with an interest in population analysis and demographic methods. Especially interested in natural disasters and disruptions to economic activity and changes in population dynamics, as well as fiscal and monetary policy with forecasting implications. Husband, father, Cubs fan.
View all posts by David

Read More »

Oil War & North Dakota

March 12, 2020

So there is so much to write about right now but I will focus on a brief discussion of the oil war and impacts for North Dakota. The half-life of information right now is so short that any writing is subject to be invalidated by the time it is first read. Oil is obviously important to the state budget revenues, but how important is not entirely clear.

There is some variability over time with the relationship and the Bakken production approach makes the price-production dynamic a bit different than what we see in other countries. Why is the war happening at all? It seems like Saudi Arabia and Russia are at odds over the future direction of policy and there is a dispute for the overall control for OPEC.

OPEC has not worked well for a time, but is particularly problematic

Read More »

Le morte de politique monetaire

March 5, 2020

Information is always revealed, though whether it is interpreted correctly is another matter entirely. This week we learned that monetary policy as it was known, a policy made by an independent policy authority is now finished. Will it ever come back? Unclear at this time.

Fiscal v. Monetary Policy

There is no sense of the divide between fiscal and monetary policy in America anymore. At the best of times and in the best of circumstances these two complemented each other. At the very least they counteracted the excesses or problems created by each other, when it was not the best of times or the best of circumstances. Now, the situation is drastically different.

Monetary policy is already left in a reactionary mode with fiscal policy on a disastrous trajectory with no

Read More »

County Economic Vitality

February 27, 2020

There is so much discussion of economic vitality in the state of North Dakota, and the rest of the country, that I spent significant time thinking about this over the last several months. Call it resilience, call it vitality, or strength, it is not an easy concept to define. While there is a great deal of data at the county level there are issues with data suppression for privacy concerns or just too few observations for meaningful analysis. You want to make meaningful distinctions between counties but what matters across all counties is really a puzzle.

With that in mind I took a look at population data, employment data, GDP data by county, and taxable sales and purchases to name a few. For a first pass I tried to cut a wide swath without getting into duplicative data while at

Read More »

Radio Show today

February 20, 2020

David

Economist and economic historian with an interest in population analysis and demographic methods. Especially interested in natural disasters and disruptions to economic activity and changes in population dynamics, as well as fiscal and monetary policy with forecasting implications. Husband, father, Cubs fan.
View all posts by David

Read More »

Domination and stagnation

February 20, 2020

David

Economist and economic historian with an interest in population analysis and demographic methods. Especially interested in natural disasters and disruptions to economic activity and changes in population dynamics, as well as fiscal and monetary policy with forecasting implications. Husband, father, Cubs fan.
View all posts by David

Read More »

Considering ND Labor Markets (A Prelude to Policy Wonks)

February 20, 2020

So I brought up a need to rethink labor markets in North Dakota last week (see post). I am not one to make recommendations and leave the work to others, so I gave this some thought in the last week. There is much data and plenty of anecdotal information available. Rather than jump into new analysis there is a need to step back and think about this from a broader perspective. I posted many times in the past about wages within the state (for example here) and labor force and unemployment (for example here and here). There is a persistence in the data suggesting a need to take the step back and think about this.

Much of this started as a result of a comment made on the post by Michael Loebach. It was a very insightful comment about some similarities between North Dakota and Iowa

Read More »

What to do about the Astros? (Department of Creative Punishments)

February 19, 2020

I am a huge baseball fan and so I watch with interest the constant iterations about the sign stealing scandal. Before I delve into options let’s consider the basic premise. While sign stealing is a constant part of the game, use of technology to analyze and communicate information to the dugout and then to the hitter is a new twist on an old approach. It seems this is a new level of problem, and one that was actually mentioned by the league in a memo. The trickle of player reactions likely requires some response form the commissioner or there will be significant amounts of vigilante activity that they will be forced to punish. Does the league want to punish those responders and not the admitted offenders? Or do you want the Hall of Fame voters to be the ones doing the policing of

Read More »

We need a new way to talk about labor markets in North Dakota

February 14, 2020

It is typical to celebrate low unemployment rates in North Dakota. While that may be something that worked in the past, the unemployment rate nationally is so low that this fails to be a point of distinction for the state. The persistent low level is also a potential issue.

The fact the rate remained low for so long should provide some concern. It is too low to attract some businesses and some labor. We need to reframe the discussion a bit. For example, are we interested in attracting employers or workers?

If we are interested in attracting workers then I suggest we talk about job openings and the number of unemployed. Shown in the graph above it should be clear that across the state there are not enough unemployed to fill all the job openings. This should go a long way to

Read More »