Where are the Jobs?

Democracy Now reported recent numbers that show improved profits of major corporations is not translating to the creation of jobs. Revenue across the Standard & Poor 500 (an index of major companies) have increased to a combined total of $1.18 trillion. This is up $518 million from last year, while capital expenditures, the kind of spending that can create jobs is down by 43%. In short, the market is profiting without workers.

These recent numbers are part of the story of permanent job losses that has rocked the economy. Nearly a quarter of the 8.4 million jobs lost since December 2007 are permanent - cut backs to the workforce that companies have no intention of recovering.

The Obama administration released a report expecting the creation of 95,000 jobs a month over the next year. This is better than the losses experienced at the beginning of 2009, as high as  700,000 jobs per month. Yet, the unemployed will continue to be hard pressed to find a job. The predicted rate of job creation is barely enough to provide work for people newly entering the work force - a number economist put at 100,000 a month. With unemployment currently at 9.4% we can expect that number to stay the same through the year. The report also predicts that we wont see unemployment reach pre-recession levels until 2015 at the earliest.

Looking at these numbers the Wall Street Journal quoted Allen Sinai of Decision Economics stating:

"Companies, in the name of making money, substitute against labor through outsourcing or technology. [Wages and benefits make workers] so expensive that who wants to hire them? As a result, the displaced workers won't be rehired unless we have double the growth rate we're expecting."

Another report tells us that currently there is only 1 job opening for every 6 people who are looking for work. This is nearly twice as bad as the 3 people for every opening last year.

With a general corporate interest against job creation many are looking toward federal action to step in. Senate Majority Leader Harry Reid introduced several proposals as a part of a "Jobs Agenda" yesterday, but with the agenda stepping back on bipartisan agreements it is to be seen how Republicans will react.