/blog > Job Market

BNP_Paribas_London_Trading_Floor

Here’s an interesting headline: Regulators Ask Humans How to Deal With Robot Traders Looks like the robot takeover is proceeding exactly as we predicted. There are just a few little bumps in the road we have to look out for. The rules have, historically, been mostly about preventing people from ripping each other off in ways that were deemed unsporting (insider trading, outright fraud, etc.). Even this wasn’t always necessary: Plenty of unsporting practices have, historically, been punished not with CFTC sanctions but with everybody refusing to trade with you because you’re a jerk. But a market dominated by computers looks a bit different. They’re so fast, and they’re all programmed by like the same 12 guys using the same mathematical models, and they have no emotional intelligence. So much more so than with humans, there’s an alarming chance they’ll all think and do the same thing.** If that thing…

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assembly_line

Michael O. Church takes a look at the world of work and finds a problem potentially as dangerous as the scourge of automation that we have been dutifully tracking here over the past couple of years. In fact, it goes hand in hand with automation to produce an even bleaker outlook than just looking at automation will provide. Per Church, the problem is an employment culture focused on subordination (linked item is not entirely safe for work due to language in the title, and may be offensive to some because of same repeated throughout): Workplace subordination, in the 19th century and the first half of the 20th, had major operational efficiencies. Additionally, the destruction it inflicted on human capital was there for poets and philosophers to observe and mourn, but it never threatened to cripple the economy, because its standardization effects outweighed its costs. Assembly-line workers, in truth, didn’t need…

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economix-unemployment-blog480

At the New York Times Economix blog,  David Leonhardt explores what he calls The Great Shift, which is pretty well summed up by the two charts shown here. We have covered this before but it bears repeating. A change in unemployment rate doesn’t tell you much if the overall working population is changing, too. The decrease in unemployment we are witnessing is more than offset by the size of the labor force. This means that there are fewer people who are “unemployed” and yet no there are no additional people with jobs. The number of people who have a job has remained fairly consistent over the past five years. Leonhardt looks at various possible explanations: a skills gap, weak economic growth, more people on disability, but none of these seem particularly satisfactory explanations. (That last one is probably more a symptom of chronic unemployment than a cause.)   The factor…

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depression

Has the unemployment rate started to move back up? Gallup says it has: According to a daily tracking poll from Gallup, the nation’s unemployment and underemployment rate has jumped significantly in the last month. The latest poll out Wednesday said unemployment was 8.9 percent compared to 7.8 percent a month ago. Gallup also reported the underemployment rate now stands at 17.9 percent . Gallup says its unemployment and underemployment rates are calculated as a percent of the workforce. Daily results reflect 30 day rolling averages based on telephone interviews with about 30,000 adults. Last month, the U S government reported unemployment at 7.4 percent. However, because results are not seasonally adjusted, Gallup says they are not directly comparable to the numbers reported by the U S Burea of Labor Statistics. It will be interesting to see how these numbers jibe with the BLS statistics. Since they aren’t directly comparable, what…

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Meeting

From Thomas Frey: There is some cause for alarm in the startup world. On the whole, young companies destroy more jobs than they create. That’s because so many of them fail.  But there is some solace: Young tech companies create many more jobs than they destroy, even taking into account a high failure rate. These are the findings of a new report, “Tech Starts: High-Technology Business Formation and Job Creation in the United States,” co-sponsored and released today by Engine Advocacy and the Kauffman Foundation. The report shows that about half of all young companies fail within their first five years, resulting in the loss of a lot of jobs. Of the companies that survive, however, businesses aged between 1 and 5 years create net job growth. And if those young companies happen to be tech startups? Well, they create a lot more job growth than the rest of the private sector. So is it too…

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sorrykid

This is not a terribly encouraging development: Teens Lose Out on Important Summer Jobs as Older Workers Fill Their Spots We’ve talked about this before. If what we’re seeing is structural, and jobs really are disappearing — an idea that is getting harder and harder to refute — then kids losing summer jobs to adults is just the beginning. It might get kind of ugly…Read More…

champagne

There’s good news and there’s bad news. The bad news is that the unemployment rate ticked up slightly in May to 7.6% (from 7.5%.) The good news is that 175,000 new jobs were created, beating April’s total of 149,000 and the projections for May of 163,000. Although payrolls increased against expectations, I note that the jump is not described as having occurred “unexpectedly.” As Glenn Reynolds has diligently noted, over the past few years, the preponderance of economic bad news has been reported as having occurred unexpectedly. Now we have some very slight good news to which the word could be legitimately applied, and it’s missing. Meanwhile, check out the interesting spin on the rise in the jobless rate: The unemployment rate rose for the right reasons. More folks are coming back into the labor market, or coming in for the first time, but more important the economy is able…

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RadicalAbundance

I’m reading K. Eric Drexler’s new book Radical Abundance, which explores the impact of atomically precise manufacturing (APM). Drexler predicts that APM will be with us soon and that it will transform the global economy in ways that can be compared to the industrial revolution of the 18th century or the advent of agriculture some 10,000 years ago. That is to say, he predicts it will be among the biggest shifts that have ever occurred. Drexler compares the introduction of APM with the digital revolution of the past few decades, asserting that APM will essentially turn the production of physical goods into a form of information technology. Just as digital technologies made it possible to produce unlimited copies of information products (books, recorded movies, music) at essentially zero cost, APM will enable the production of physical goods at a tiny fraction of the cost of producing them today — enabling…

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dollarfeatured

[UPDATE: due to the recent interest (thanks, Glenn!) I have bumped this piece back to the top.] More bad news about jobs. With the unemployment rate at 7.6%, the recent euphoria about it dropping to 7.2% a while back is all but forgotten. (And perhaps wasn’t all the called for to begin with?) But the news is worse than just a persistently high jobless rate: The labor force participation rate has not been this low — 63.3 percent — since 1979, a time when women were less likely to be working. Baby boomer retirements may account for part of the slide, but discouragement about job prospects in a mediocre economy still seems to be playing a large role, economists say. “The drop in the participation rate has been centered on younger workers,” said Joshua Shapiro, chief economist at MFR Inc., “many of whom have given up hope of finding a…

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manufcaturingoutputvsemployment

Bill McNabb, chairman and CEO of the Vanguard Group, writes in the Wall Street Journal that uncertainty is holding back economic growth — in particular the introduction of new jobs: Quite simply, if firms can’t see a clear road to economic recovery ahead, they’re not going to hire and they’re not going to spend. It’s what economists call a “deadweight loss”—loss caused by inefficiency. At Vanguard we estimate that the spike in policy uncertainty surrounding the debt-ceiling debate alone has resulted in a cumulative economic loss of $112 billion over the past two years. To put that figure in perspective, the Congressional Budget Office estimates that sequestration may reduce total funding by $85 billion in 2013. Clearly, the U.S. debt situation is the economic issue of our generation. But it’s not just about the numbers. Every time lawmakers seemingly get close to a deal that will restore fiscal responsibility but…

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