The labor force participation rate has declined from 66.5% in 2007 prior to the last downturn to 62.7% today. This decline in the participation rate is difficult to reconcile with the alleged economic recovery that began in June 2009 and supposedly continues today.
Normally a recovery from recession results in a rise in the labor force participation rate.
The Obama regime, economists, and the financial presstitutes have explained this decline in the participation rate as the result of retirements by the baby boomers, those 55 and older.
In this five to six minute video, John Titus shows that in actual fact the government’s own employment data show that baby boomers have been entering the work force at record rates and are responsible for raising the labor force participation rate above where it would otherwise be.
The offshoring of US manufacturing and tradable professional service jobs has resulted in an economy that can only create new jobs in lowly paid, increasingly part-time nontradable domestic service jobs, such as waitresses, bartenders, retail clerks, and ambulatory health care workers.
These are not jobs that can support an independent existence.
However, these jobs can supplement retirement incomes that have been hurt by many years of the Federal Reserve’s policy of zero or negative interest rates.
Those who were counting on interest earnings on their savings to supplement their retirement and Social Security incomes have reentered the labor force in order to fill the gaps in their budgets created by the Fed’s policy.
Unlike the young who lack savings and retirement incomes, the baby boomers’ economic lives are not totally dependent on the lowly-paid, part-time, no-benefits domestic service jobs.
It is not retirees who are pushing down the participation rate, but those in the 16-19 age group whose participation rate has fallen by 10.4%, those in the 22-14 age group whose participation rate has fallen by 5.4%, and those in the 24-54 age group whose participation rate is down 2.5%.
Lies are told in order to make the system look acceptable so that the status quo can be continued. Offshoring America’s jobs benefits the wealthy.
The lower labor costs raise corporate profits, and shareholders’ capital gains and performance bonuses of corporate executives rise with the profits.
The wealthy are benefitting from the fact that the US economy no longer can create enough livable jobs to keep up with the growth in the working age population.
The clear hard fact is that the US economy is being run for the sole benefit of a few rich people.
Dr. Paul Craig Roberts was Assistant Secretary of the Treasury for Economic Policy and associate editor of the Wall Street Journal. He was columnist for Business Week, Scripps Howard News Service, and Creators Syndicate. He has had many university appointments. His internet columns have attracted a worldwide following. Roberts’ latest books are The Failure of Laissez Faire Capitalism and Economic Dissolution of the West and How America Was Lost.
By Paul Craig Roberts, John Titus, and Dave Kranzler