Monday , September 16 2019
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Jared Bernstein: On the economy

How hot labor markets can lead to misleading median comparisons.

The Census income and earnings data sometimes have a confusing characteristic that is not uncommon in these sorts of data, especially in periods of tight labor markets, as was 2018. The issue has to do with changes in medians from one year to the next. For example, the data that came out this morning showed that for both men and women full-time, full-year workers, real annual earnings rose 3.4 and 3.3 percent, respectively, 2017-18. But for all ft/fy workers, combining both genders, earnings...

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The 2018 Poverty, Income, and health coverage results: a tale of three forces.

This morning, the Census Bureau released new data on health insurance coverage, poverty, and middle-class incomes. While the data are for last year, they shine an important light on key aspects of families’ living standards that we don’t get from the more up-to-date macro-indicators, like GDP and unemployment. As the economic recovery that began over a decade ago persisted through 2018, poverty once again fell, by half-a-percentage point, from 12.3 percent to 11.8 percent. Other results from...

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Payrolls slow and the trade war is hurting manufacturing. But underlying job market still solid.

Payrolls rose by 130,000 last month and the unemployment rate held at 3.7 percent, close to a 50-year low and the same level as the past 3 months. Still, job growth is cooling (25,000 of this month’s gains were temporary decennial Census workers), as the pace of monthly gains, while still strong enough to support low unemployment, has slowed. Wage growth also stayed parked at about where it has been in recent months, and there’s some evidence that the trade war is taking a toll on factory...

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The NYT wrote a woefully imbalanced piece on Opportunity Zones.

A number of people (OK, four…but it’s early) have asked me to respond to the NYT piece from last Sunday on how the Opportunity Zone tax break is nothing but a boon to the rich. As I’ve written in a few opeds, I’ve been a cautious supporter of the program, though I’ve been careful to make the points that a) it’s too early to say much about outcomes, and b) while OZs have the potential to become a wasteful tax shelter mechanism, some early signs are hopeful. And, as the Times points out, some...

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Recession Readiness and State UI Trust Funds

Given the recent dramatic spike in media coverage of our economic headwinds and recession readiness over the past week, we decided to take a closer look at the balance sheets of state unemployment insurance (UI) trust funds. While the Department of Labor (DOL) is responsible for overseeing the UI system and paying administrative costs, the basic program is managed and mostly funded by the states. Using the most recent final data available from the Treasury Department, we analyzed the number...

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A quick note on China’s devaluation

Source: WSJ Just back from ranting about this on CNBC so I’ll quickly share some thoughts on the news that the Chinese yuan broke 7/$, in a depreciation that threatens trade-war escalation. Bottom line: the trade war may be about to get worse, and that won’t be good for markets, consumers, and the global economy. It’s hard to see a way out between these two sides, though electoral politics could force Trump to stand down next year. The numbers: –Depreciations offset tariffs. That is, a 10%...

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Still a solid job market, but with a cloud or two

Payrolls rose 164,000 last month and the unemployment rate held steady at 3.7 percent. Wage growth accelerated very slightly–3.1% in June to 3.2% in July (year-over-year nominal hourly pay)–but it has been roughly stalled just north of 3 so far this year. Downward revisions for the prior two months–May and June–appear to have slowed the underlying trend in job growth. In our report from last month, we showed the 3 and 6-month trends to be 170K jobs per month. As this month’s jobs smoother...

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Sharing the wealth, or at least the compensation

Twitter econ asked for my historical ECI series, so here you go. See tab “finaltbl.” For columns B and C–pvt industry–I do a small splice re older data which you can track through the spreadsheet. For cols D & E–these are “all civilian” and are the series we use for our wage mashup–I don’t bother splicing. I doesn’t really make a difference as splice factor is tiny for toplines (they matter more for industries). Now, in return, I want gobs of twitter love and a wage series to be named...

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Some responses to the responses to my “4-economic mistakes” piece.

I got lots of interesting feedback on a piece I wrote for Vox about long-held but empirically wrong assumptions in some key areas of economics, assumptions that have been asymmetrically harmful. That is, their costs consistently fall on those with low- and moderate incomes and their benefits help the wealthy. Some argued that I didn’t go far enough. Dean Baker, a friend and frequent co-author, argued that I pulled punches regarding globalization, which “…was designed to hurt workers. We could...

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Here’s a simple way to tell if someone (like the Nat’ Restaurant Assoc.) is abusing numbers to mislead.

One sure way to tell in someone is making a biased argument is showing up in various statements by those who oppose the proposal to raise the minimum wage. I wanted to be sure to elevate this dastardly ploy, as it’s a tell that someone is trying to win an argument based on their bias, not on the evidence. Here’s a tweet from the National Restaurant Association, a group that’s honor bound to oppose the minimum wage, and here’s the same ploy from a Texas Republican member of Congress. In both...

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