Zeller: Job recovery still far too slow
SALEM – While there is some good news in the latest new unemployment claims in Ohio, Cleveland Economic Research Analyst George Zeller said at the rate new jobs created, it will take 111 years for Northeast Ohio to recover the jobs lost since 2000.
Zeller, a 1967 Salem High School graduate, uses the benchmark year of 2000 since his reports are designed to measure the point at which Ohio’s lengthy 2000s recessionary labor market contraction concludes as a result of the end of job destruction.
His data tracks employment losses in Ohio because it is directly associated with payroll earnings losses and also cause declines in other measures of the business cycle, notably revenues generated by tax streams at various levels of government.
The income tax and the sales tax are particularly subject to trends in the business cycle.
Therefore a determination economic indicators: Job and earnings trends that update the point at which the impact of the 2000s recession finally disappears in Ohio’s labor market is an extremely important issue, he said.
He noted that Ohio’s 7,511 new unemployment claims for the fourth week in April 2014 are minus -5.9 percent lower than the 7,978 new unemployment claims that Ohio had during the fourth week of April 1999, the last year when Ohio had unambiguous job growth for the entire year.
This figure has moved slightly into the “job growth” level.
Zeller said this week’s favorable Ohio data starts a new current streak of one consecutive week when the state has ‘job growth’ levels of new unemployment claims that are not currently elevated.
But there are overriding issues that are much less satisfactory and more troublesome than incremental “job growth” numbers.
The Bureau of Labor Statistics says that nationwide six million factory jobs were lost between 2000 and 2009.
The year 2000 is the beginning of Ohio’s ongoing recession and it wasn’t until 2007 when the “bad recession hit,” Zeller said.
While some say the economy is recovering, Zeller said, “We need to speed up the rate of growth.”
The hole is deep and wide in Northeast Ohio which has lost 41,000 manufacturing jobs since 2007.
“The good news is we are gaining manufacturing jobs now and, in Northeast Ohio, the trouble is at the rate we’re gaining now it will take 111 year to recover the jobs we lost since 2000,” he said.
Northeast Ohio gained 1,144 jobs last year.
Zeller said one county in the state recovered its jobs back to the pre-2007 recession level. That is Carroll County which is currently the oil and gas industry’s Utica Shale play centerpiece, attracting millions of investment dollars.
Zeller called the 111 year recovery period “a stunner.”
Another side to this is America’s population.
In the 40 years, from 1970 to 2010 the population increased by 105.3 million people, from 203.4 million in 1970 to 308.7 million in 2010.
The population clock at (www.census.gov/popclock/) the U.S. Census webpage shows almost 318 million as of May 4.
So, how do you square the growing population with the loss of six million manufacturing jobs?
“We need to speed up the rate of our growth and recovery,” Zeller said, adding “this 111 year figure is flabbergasting.”
He explained, “We need to speed up the rate of growth … and … the average wage of those employed went down … so the rest of us are suffering too. So there’s a lot more than unemployment. We need increased wages.”
Zeller said policy change is the key to that.
“We’ve had 17 months in a row in Ohio with growth lower than the national average,” he said.
“Local governments are feeling the severe strain. We’re not growing fast enough.”
He pointed to 1932 when the government cut spending.
“We know what happens when we slow spending down,” Zeller said.
“For 17 months we slowed down (Ohio) and now we’re below the national average … for the last 17 months. The entire state is growing too slowly.
“When you have it for only one month you can say maybe it’s a statistical thing … but 17 months, it’s a pretty steady thing.
“Eventually you need fiscal discipline but doing it now was a great blunder … a self-inflicted wound.”
And, he said, the bickering in Washington could portend great danger “for all of us” if the political system collapses.
“There are so many struggling and they need to be addressed. It’s an emergency … (and) even in those relatively good numbers on Friday there is an enormous amount of suffering.
“People need to quit denouncing and denying there is suffering and stop the reduced sending.”
See more at: georgezeller.com/newclaims042614.pdf.