A closer look at the Department of Labor’s employment report earlier this month reveals that the real unemployment number is different from the “headline” number. Restated, the Bureau of Labor Statistics (BLS) should have concluded that unemployment is at least 9.1 percent, and most certainly much higher.
In an effort to examine the Occupy Wall Street crowd’s complaint about income inequality, economist Mark Perry has concluded that people with higher incomes work harder and longer than those who don't.
A quick perusal of Perry’s graph based on the Census Bureau’s data illustrates the following reasonable conclusions: Households with high incomes have more people working full time, they’re in their peak earning years, they’re married and college-educated. On the other hand, households at the opposite end of the spectrum have fewer people working, more likely to be single and less-well educated, and less likely to be in their peak earning years.
Current data from the Census Bureau show the following:
- There are two income earners in high-income households, while fewer than half a worker in the lowest-income households
- Eight out of 10 high-income households consist of married couples, compared to just one out of six in the lowest.
- Single-parent families or singles make up more than eight out of 10 families in the lowest-income bracket, while just one out of five are in the highest bracket.
- Three-quarters of the highest-income households are in their peak earning years (age 35-64) while fewer than half of the lowest-income households are in their peak earning years.
- Almost 80 percent of the highest-income households have full-time employment, while barely one out of six in the lowest income households have a full-time breadwinner.
- In the highest-income households, one out or eight don’t work at all, while two out of three in the lowest-income households don’t work.
- Sixty percent of those in the highest-income households hold a bachelor’s degree or higher, while only one out of eight in the lowest-income households do.
- This is confirmed also by the fact that only two percent of those in the highest-income families have less than a high school degree, while 26 percent of those in the lowest-income families don’t hold at least a high school diploma.
As Perry noted:
American households in the top income quintile have almost five times more family members working on average than the lowest quintile, and individuals in higher-income households are far more likely than lower-income households to be well-educated, married, and working full-time in their prime earning years. In contrast, individuals in low-income households are far more likely to be less-educated, working part-time, either very young or very old, and living in single-parent households.
Perry’s graph is a visual representation of the American work ethic: Those who have prepared themselves in advance, work hard, and take advantage of opportunities, seem to make the best of things. Those who haven’t, for whatever reason — age, circumstance, or choice — seem to represent the other end of the spectrum.
The prediction by the Economic Cycle Research Institute (ECRI) that the United States is headed into another recession was greeted by a rise in the stock market from 1,074 on the Standard and Poor’s 500 Index on Tuesday, October 4, to 1,238 on Friday, October 21, a gain of 15 percent in just 13 days.
While high unemployment persists and the U.S. economy remains stubbornly flat, Washington, D.C. now hails as the nation’s wealthiest metropolitan area, according to new data from the Census Bureau. Dethroning Silicon Valley from its royal chair, the hometown of Congress and the White House is flourishing, as the median household income for Washington residents stood at $84,523 in 2010, when the nation’s average household income was $50,046. The data shows that San Jose, home of Apple and Cisco Systems, held an average income of $83,944 in 2010, falling from $84,483 in 2009, and now riding on the coattails of America’s political stronghold.
With the announcement from Gallup that the unemployment rate had dropped precipitously in early October to 8.3 percent came the disclaimer that they could be wrong. Chief Economist Dennis Jacobe wrote that “the sharp drop in Gallup’s unemployment and underemployment rates may partly result from seasonal factors. Halloween has become the third-largest sales season for many retailers, who are likely increasing their staffing accordingly. In addition, some stores may have been minimally staffed and are beginning early to add employees for the holidays.” But it also “means it could be something of an aberration that will dissipate during the weeks ahead ... but for now, this job market improvement appears real.”