Loading summary
Transcript205 lines
- [00:01]
A
Are you looking for a daily dose of market news without the jargon and the noise? I decided to go take a look and see what those analysts are saying and who those non institutional investors might be. I'm Ann Berry, investor, CEO and board member, and my show Brew Markets dives deep beyond the headlines to break down the stories of stocks with insider insights. So a really powerful chart there. You see just massive deviation. Well, it's the lifeblood of trade. There's just one chapter in there which really struck me because, you know, I've been a CEO of business. You'll come away from each episode of Brew Markets able to ask the questions that help you strengthen your market. Not New episodes drop every weekday afternoon, so tune in to Brew Markets wherever you get your podcasts.
- [00:40]
B
Hi optimists, it's Robin. When we would have been recording a new episode for this week, Catherine was in Washington, D.C. testifying in front of the House Ways and Means Committee's Subcommittee on Taxes. We'll get the lowdown on how that went next week, but meantime, our audio and video producers Sophie and Andy, suggested that we rerun this episode about youth unemployment. Indeed, it's graduation season and my social media feeds are full of people's kids and caps and gowns. I did check to make sure that the unemployment situation hasn't changed that much since we originally recorded this episode. According to the New York Federal Reserve, the unemployment rate for recent college graduates that's people aged 22 to 27 with a college degree is currently 5.6%. That's down slightly from 5.7% a year ago, and it is still lower than the unemployment rate for those without a college degree. For all young workers in that age group, the unemployment rate is currently 7.2%. This is also far from the worst it's ever been. In April 2010, coming out of the Great Recession, the unemployment rate for recent college graduates was 6.9%. Anyway, I think this episode holds up. If you're a recent grad or you know one, you can text this episode to them from July 2025. Here's our episode tit about that college grad who can't find a job.
- [02:09]
C
Hello and welcome to Optimist Economy. I'm Kathryn.
- [02:12]
B
I'm Robin.
- [02:13]
C
On this show, we believe the US Economy can be better, and we talk about how to get there one problem and solution at a time.
- [02:26]
B
At the top of our show, we make a few announcements. First, I want to say this episode was brought to you in part by Ben, who calls himself a grateful wannabe economist, also a business leader who's sick of the spin. He came to us as a spiritual sponsor on Substack and he's listening to Optimist Economy in Vermont. I also wanna point out the reviewer who said that his daughter won't take his podcast recommendations. So he just went around her and recommended it to his future daughter in law. And I think this is an excellent move, sir. And I recommend it to everybody.
- [02:58]
C
All future daughter in laws, be warned, you're about to get a recommendation.
- [03:03]
B
That's right. That's right.
- [03:05]
C
Also thank you to everyone who pointed out how many broken links we had in our profile. This is a journey that we are all on together and we are fixing those links. Hopefully they're fixed by the time this thing should be. Christ, that'd be bad.
- [03:21]
B
If we haven't fixed it by now, we're in real trouble by the time you see this.
- [03:26]
C
Yeah, I think we got it. Next up is Retcon Retroactive continuity where we revisit or correct past episodes.
- [03:35]
B
Reflect. I like to say reflect on reflect.
- [03:38]
C
Did you have a retcon?
- [03:39]
B
I did. Just because you mentioned very quickly in passing in our episode about GDP versus other measures of well being that New Zealand had tried this. So I went to do a little reading about what happened in New Zealand. It did a Wellbeing budget in 2019. It was pretty complicated, complicated system, but they basically scored their budget across these 12 domains and they had sort of three or four categories under each of those. And it did lead to some concentrated investment in mental health, in schools and in hospitals. Then it of course crashed right into the pandemic in 2020 and center right government came to power in 2024 in New Zealand. I'll put some links to things about it in our show Notes. It was criticized for being pretty complicated, but it also was still a framework that I think is discussed in New Zealand as a way measure the progress of the society and also sustainability of their society.
- [04:31]
C
Measurements don't have a one and done effect. It's hard to get people to understand a measurement, to expect it to have like a reasonable sense of what's good and bad and see the trend lines
- [04:41]
B
and have a track record of it being valuable.
- [04:44]
C
Yeah, I mean that's hard to do. So kudos to New Zealand. I had a bunch of retcons about boys. Here's a surprise, Boys and men as we're recording, the episode is the most recent to publish and we had a few notes that I think are worthy of airtime. The first is that at no point during the episode do we say boys to men. And I understand that listener is. You can't be more disappointed in me than I am in myself for not.
- [05:14]
B
Are you gonna sing a song?
- [05:15]
C
I could. I could sing a lot of them, and at least for one of them, I could try to do the dance and probably injure myself. But, yeah, that was. That was an own goal.
- [05:24]
B
Okay.
- [05:26]
C
Apologies to our listener base. The second was that someone reached out to me over DMs to say that he loves video games and they get a really bad rap. And he's been through many eras of like. And now here's how video games are ruining society. And thank you for that comment, but I wanted to clarify that when we talked about young men who are sitting out of the labor market who play a lot of video games, it's not as if video games themselves are bad. It's the role that they play in the lives of men who aren't working that end up being pernicious because they truly are addicted. And so it's. I would say it's the difference between, I like to go to happy hour with friends, and I have a chemical dependence and addiction to alcohol. The problem isn't that people go out and, like, drink a beer at a baseball game. The problem is that some people become so addicted to alcohol that they have a substance use disorder. And there's a version of substance use disorder for video games. And what I think a lot of researchers have tried to understand is how much it's a push versus a pull. Like, is it that you can't find a job and so you take solace in video games, or that you are addicted to video games, and then that pushes you out of the labor market because you, frankly, just don't want to work because you are addicted. So that's not to say that any gamers out there that I'm trying to throw shade on the consumption of leisure, as we economists would say, it's your happiness, man. Go out and consume it. But for some people, it's. It's a hindrance to living a full life because it becomes an addiction. Same thing with gambling. Like, there's lots of people who can bet on something because it's fun, or they happen to be in Vegas, and so they're going to bet on a sports game, and it doesn't lead to them taking out six mortgages on their home and, like, losing their family. So all these things, these behaviors have degrees. And what we wanted to bring up was that men have addictions to these at much higher rates and it's associated with not being in the labor market as well as really poor mental health, really poor physical health, really deep levels of unhappiness.
- [07:23]
B
Yeah, I think video games, especially now with mass multiplayer online video games too, they can fulfill a spot in your social life and fulfill a spot even in your day to day behavior that you would normally get from a job. So that some of the non financial motivations for going out and finding something to do with yourself go away.
- [07:45]
C
Yeah, I think of it as being almost like I say this a lot. It's. It's neutral. Like it can provide a lot of joy and community and belonging and identity and things like that or even just a great way to let off steam and then it can have a pernicious side. So we wanted to clarify that it's to me relatively neutral as a way to consume leisure. Oh my God, how am I do. I don't even sound like a person sometimes when I talk. How do we have listeners? It's a neutral way to consume leisure. I have a PhD. Jesus Christ. Well anyway, we should just move on to the next thing because I don't know how to rescue that. Someone else brought up kind of a point about me as the Boys and Men Commissioner that I would like to have a universal system that is free, high quality, paid for by the federal government, administered by communities to have early childhood 0 to 5 childcare after school from 3pm to 6pm in summer, from May to July, coverage for students to participate in a development system. And this is something that would build community institutions, opportunities for mentorship, child led learning. And what one listener pointed out was why wouldn't you just use the current sympathy for boys to push for this system? And he brought up that there is a capital to almost sympathy and victimization narratives that are like, well turns out my thing is the thing that will help them and legitimately. A child develops development system would help boys. I mean it would help girls too, but it would introduce more mentors who wouldn't necessarily be as gendered as their teachers. It would introduce a lot of activities for learning and growing and skill development and whatever I shouldn't say or whatever. I actually care quite deeply about this, about this person. Like I don't know or some other bullshit I say in the third chapter. But he brought this up and I think it's a really good point but it's ultimately a political one. And so I feel out of my depths to make it. I think for me it's problem and SOL and that's what we want to talk about. And there is a whole other conversation about political viability and like, political salesmanship that we don't really talk about on the show. And it was interesting to me. He was like, you know, this is, this is a great way to get something.
- [10:01]
B
But, you know, but we talked about this about the housing op ed that, you know, it's like, sure, you can say we need to work on housing affordability because that will make young men feel better about being able to afford a house. Right. But not everything belongs in that lens.
- [10:16]
C
I think his point was that sometimes that lens can lead to political victories of like, you're going to get someone on board just because they want to show that they do something for boys. So wouldn't she want to ride those coattails? We're going to talk about unemployment today. And I think it's an interesting kind of case study in riding the coattails of the most sympathetic victim. So we'll come back to that. But someone did bring that up and just going to say again that my child development system would help boys, but it's not wrong. It's just not in the ethos of the show or what we want to do. Not because we look down on it, because I think there aren't as many people in the space that we're in saying, here's the actual problem and solution now go sell it.
- [10:59]
B
You go do what you need to do. Somebody else's job.
- [11:01]
C
Somebody else needs to go make this clever. But we need to talk about the problem and solution. And so that would be my comments to him and then the last retcon because I'm very good at the show and never forget things. While we're talking in the GDP episode, we talked about how poverty is measured separate from when the poverty episode where we didn't talk about it, but in the GDP episode where we talked about it, I brought up that there was a new measure of poverty that wasn't operationalized.
- [11:25]
B
We did talk about it in the poverty.
- [11:27]
C
Yeah, we talked about it in poverty.
- [11:29]
B
Okay. We have talked several times about the poverty measure and how it's been updated and how operationalized or not it's been.
- [11:38]
C
The reason why poverty's new measure that is much more sophisticated, much more reasonable, used by researchers is not used in, say, deciding if you're eligible for SNAP is because it would be so much harder for state and local administrators to determine. I mean, they basically are like, how many people in your household and what's all the sources of cash I mean, it's still a lot for them to determine, but. But that's easier than, like, so what are your medical expenses? What are your transportation expenses? How much? How much taxes? Yes. It would be way too hard for them to do and it would put too much of a burden on both sides. So it's a measure of poverty for getting at a better sense of people who don't have enough. But it's not good for program participation selection, which maybe would suggest that there's another third secret thing we could do to help catch people who are having a hard time and get into social welfare. That's not just a little stamp that says poor or not poor.
- [12:39]
B
Okay, that's the end.
- [12:41]
C
That's our show, everyone.
- [12:45]
B
Okay. You know, we record two weeks ahead, and so sometimes we're responding to things that are three weeks old and things that we just heard and things we just thought about ourselves. So thank you for bearing with us.
- [12:57]
C
Just hope everybody took notes. Took ample, ample notes.
- [13:01]
B
And if you're listening out of order, I am really sorry because, you know, this has got to be like a time travel movie for you.
- [13:11]
C
Our next segment is terms and conditions and conditions. And speaking of terms and conditions, sometimes we call them segments and sometimes we call them chapters, and sometimes we call them pilcrows, and you'll never know which one we're going to use.
- [13:24]
B
Just be surprised.
- [13:26]
C
Be surprised. Every time we're going to go from a segment to a pilcrow, everyone, Terms and conditions, I have to shout out listener John Luther in Schuylerville, New York, who came up with the perfect answer to our challenge of what do we call politicians that are being forced into retirement as per our executive orders of having retirement ages for elected officials and judges? He says that they're gray goose.
- [13:52]
B
It's not a lame duck grey goose.
- [13:55]
C
Like it lame duck gray goose. I have no notes. I love this. I fully endorse it. We need to have some gray gooses or gray geese, damn it.
- [14:03]
B
Flocks of them. Flocks.
- [14:05]
C
Flocks. We have flocks of gray geese in
- [14:08]
B
Congress right now for sure. My term this week. I actually did come across this in actually reading something cruft. And where I read it, it was spelled with a K, K, R, U, F, T. Cruft. It's mainly used with that letter in particular in the context of talking about computer code and getting excess, unnecessary, leftover, useless stuff out of computer code. But it comes from cruft with a C, just meaning unwanted or unnecessary useless, leftover stuff.
- [14:40]
C
Maybe this is like Sophie's job description, it's true. She's like, I know Cruft well. Very well.
- [14:48]
B
Decreft. I am going to decreft this episode. It's going to take me a week. All right, next section. Also chapter. Also Pilcrow.
- [15:00]
C
Also segment.
- [15:01]
B
Also segment. I'm going to get a Pilcrow tattoo. You've heard, to match your GDP tattoo.
- [15:14]
C
That's pretty hardcore. We're talking about unemployment.
- [15:18]
B
I thought we were talking about underemployment.
- [15:20]
C
So we're talking about underemployment.
- [15:23]
B
A challenge. We have two different shows. What I thought we were going to talk about is how many people on the Internet and elsewhere in articles look at the 4.2% unemployment statistic. And they don't feel like that is really grasping the bigger picture of what's happening with the labor market and fairly or not, with the economy overall. There are these other forces at work. No hiring or slow hiring jobs being posted that aren't real jobs. They turn to some of these alternative reporting, I'm going to call it a BLS remix of data to say, actually the real number of unemployment is this. Or don't look at the headline unemployment number, look at this other number. Or combine these three things and you'll find out, in fact, that the elites are lying to you, the government is lying to you, or it's really way worse than you think it is. And I just don't know how much these people are just looking for a justification of what they're feeling, or are they actually struggling to understand something that is happening, but that just isn't reflected in the headline unemployment number.
- [16:45]
C
Honestly, that sounds really interesting. I think we should talk about that. I mean, I prep for a bunch of stuff, but, like, that's good. We should say first and foremost that if you are struggling and someone tells you the economy is fine, that sucks. Like, that's basically.
- [17:01]
B
You don't believe them.
- [17:02]
C
Yeah, you don't believe them, and they're basically saying either they're lying or you don't matter.
- [17:07]
B
And it's not even actually just you. It's your friends, your kids, your family. I think that the same way any sort of social thing filters through to your personal experience, whether it's addiction, suicide, you know, but joblessness is the same thing. That you may not be jobless, but you feel the joblessness of people around you.
- [17:28]
C
Yes. And that's tough because, you know, I can say with certainty the unemployment rate is not wrong. It's not a lie. And it is one of the Paramount indicators of how well our economy is doing. But at no point in our economy is the unemployment rate a predicted that everybody's doing well.
- [17:50]
B
I think that once you tune into it, you sort of see it everywhere. Right? Like just this weekend, I was at the. I was at the gym and I was talking to the woman in the locker next to me. She's been looking for a job since February, just landed a job. It's completely not what she's done in the past. She's starting over kind of at the. At the lower rung. Then I go to buy a jacket at. Maybe I shouldn't say that. They're not a sponsor.
- [18:12]
C
They're not a sponsor. So I went and bought a jacket. Somewhere to be named.
- [18:17]
B
I went to buy a jacket. And the person checking us out, somehow it came up that we had gone to the same university and she'd graduated. And I thought, and there she is, and she's working retail and was sort of uncomfortable telling me that. So once you tune into it, it's like when you buy a car and you see your car everywhere on the road all of a sudden. And I think people have tuned into the economy isn't great. And they're looking for affirmation of that.
- [18:45]
C
And it's tough because the economy, you know, it's never batting a thousand. It's never like, yep, it's great for everyone all of the time. And if the unemployment rate is below 4.5%, then everybody is having a great time at it. Like, that's never been true. But the way that the economy can be underperforming is really nuanced, and it varies over time. Like, I would say that we're in a weak economy. And I've never seen the economy look weak the way that this one does.
- [19:13]
B
Really?
- [19:14]
C
Yeah, it's a very. I mean, this is an incredibly unique time period in the US Economy. And it's not. We don't see this that often. We're waiting in uncertainty. And I mean, I can talk more about that by the time this airs, though overtaken by events. So I don't want to talk too much about just the economy today, but really rather talk about how these feelings that people have that the economy, the big statistics don't reflect them, is valid, but that doesn't make the big statistics wrong. And I think I'm kind of of two minds about it, which is on one level, I get like a little miffed. Cause I'm like, y', all, we measure all that. Like, you're like, you Know what? You should measure people who want a job. Part time job.
- [19:57]
B
Yeah. People are working part time but want a full time job.
- [20:00]
C
Absolutely. Measure it. Maybe we should measure people who want a job but they just haven't looked this month. Also measure that. Like, maybe you should come up with a different unemployment rate. Yes. Have one. It's called the underemployment rate. We have all these measurements. I think the reason why they don't get as much attention is in part because they're not as big as maybe people would believe.
- [20:22]
B
Those subsets of the subsets of people.
- [20:27]
C
I think on some level, people want a different measure because they're looking for validation and those measures exist. So it must be the case that they're not getting validated from them. And that's really hard because this is really getting at the emotions people have with their economic livelihood and not just the statistics. So I think part of me is like, y' all don't realize that you're sleeping on the BLS and you should not. They measure so many things. The BLS is a hero. And we have all these things that we measure. And then at the same time, a lot of the things that we don't measure that people get really, like, also have strong feelings about. We don't measure them for a reason. And it's because it would be a really uninformative and unhelpful statistic. And that's also really harsh to tell people. So I'm of two minds. I'm very sympathetic for people who are having a hard time. But as we've said so many times on the show, if you do not correctly diagnose the problem, you will not find the solution. And a huge problem with a lot of these, like, well, we should measure it this way is like, that would not get you to where you want to go.
- [21:36]
B
I mean, what are you talking about specifically?
- [21:38]
C
Well, there's this one measure called the true unemployment rate.
- [21:42]
B
And true, like, not false.
- [21:45]
C
It's tru. They call it the true unemployment rate. And it's a think tank or an institute. They construct it and they, of course, they use all the BLS measures and then they compile it into a new statistic which they say TRU unemployment. And I think it's worth noting that I would be nicer if they didn't call it true, because that kind of implies that the unemployment rehab is false.
- [22:07]
B
Yeah, it's false.
- [22:08]
C
And I was like, yo, that is slander on the bls.
- [22:11]
B
Do not lie to the bns.
- [22:12]
C
Do not lie Full of the BLS in front of me. But they're one of many alternative measures that are trying to come outside the government to say that the economy is much weaker than it is. And I don't think it serves their cause well.
- [22:24]
B
You don't think it serves workers cause?
- [22:28]
C
Well, in the case of the true unemployment rate, this alternative measure, I wish
- [22:32]
B
you guys could see the way that the italics and true or something are showing up on Katherine's face.
- [22:38]
C
I've just, I've gotten actually so many calls about it from reporters where they're like, have you heard of this new measure? Like, what do you think?
- [22:44]
B
They found it on Twitter. And they're like, hey, yeah.
- [22:48]
C
What this measure says is that people who have low wages are functionally unemployed because they don't have a higher paying job. And so they're really no different in terms of labor market performance than people who don't have a job. And I take such offense to this. I think it's probably for the best that I push the microphone away from me before I blow out one of your eardrums. Talking about. I really feel I'm just going to take a step back how I really feel about telling someone who has a job that they are actually unemployed. Okay, okay.
- [23:26]
B
Yeah.
- [23:29]
C
Like I said correctly, diagnosing the problem in order to find the right solution. And you're calling people who are out there trying to make it in the economy whatever job that they could find as a problem. Like, no, sure, no, sure.
- [23:44]
B
But when you get together with your labor economist friends, having the time of our life, having the time of your
- [23:51]
C
life, saying things like, we're back some
- [23:54]
B
brewskis and you're talking about the health of labor market. Are you talking about the big number? Are you talking about 4.2% or what are you looking at? Man?
- [24:09]
C
If I'm, if I'm sitting around with a bunch of labor economists right now talking about the labor market. Long silence, long silent pause. I almost think I shouldn't say because we're so aloof it makes us seem dark. Yeah, there's going to be a little bit of recession speculation of like, how much longer until the economy breaks because it's under an incredible amount of pressure. The weight on the US economy right now is almost like the World War II British slogan like keep calm and carry on. Like five years ago, our economy imploded under the weight of the pandemic. I mean, like the number of people unemployed, the number of jobs that were allowed erased, the blowback to so many communities and people's lives and like we just kind of put the pieces together and it's like don't look, walk forward, do not look too close.
- [25:05]
B
It all back together.
- [25:06]
C
We've super glued it all back together. And so I think there's this little bit of like, don't anybody bring it up. Like don't anybody. Like we have held it together. I mean we have held it together. I remember in like January of 21.
- [25:21]
B
Yeah.
- [25:21]
C
I did an interview where someone was like so is the economy slipping back into recession? And then the, the next year of like well the, you know, workers are doing so well, we must have held off that recession and the inflation hits and it's like, well we're probably going to dip into recession. And it is not normal in the US economy to spend a half decade going actively recession, actively wondering if the recession is going to happen next month. That's not normal. This is, these are not normal times. And so I think, I think the labor economists, we tend to take the long view of what's going on with young people right now. The questions that we're thinking about are the really big questions that are raised by what's going on and less so. Do you think these kids really can't find jobs? It's really not like that. It's more like are we jeopardizing the return to college education because we've made it too expensive? And now you're being met with a generation that's really going to spur in college because they were hit on both sides, Pandemic on the front end, whatever this bullshit is. On the back end we were really jeopardizing college and that's an industry that's going to be in turmoil for the next 10 years regardless of all this. So I think those are the questions we would have would be like thinking really big, not trying to deny or gaslight people's experience, but kind of put it into context of larger questions.
- [26:41]
B
And you guys obviously know all the nuances of what the Bureau of Labor Statistics is measuring and that it is measuring have a part time job, have two jobs and that the fact that those aren't rolled into the 4.2% is done for a reason. And you guys understand that reason.
- [26:59]
C
Yeah. And we, you know, it's partly consistency and that we want to have, we want to be able to compare over time. And so if you keep changing the unemployment rate, you don't really know what's happening. Like one example of this is that our measure of the hiring rate which has been so Important in advocating on behalf of young people to say that hiring has not picked up. Not just young people though that measure only goes back to 2001, December of 2001. So we don't even know. We can't compare it to say like the 70s or the 80s recession. We can't compare it to the roaring 90s and what a tight labor market hiring rate looks like. Cause that measure doesn't go back that far. So we're missing some big benchmarks and we never want to lose one.
- [27:41]
B
Yeah, yeah.
- [27:42]
C
I will tell you that the heroes over at the Bureau of Labor Statistics measure lots of these things. So I'm just going to bring them up quickly to kind of get aside that we have measurements of them.
- [27:51]
B
Okay.
- [27:52]
C
All this information is collected through the Current Population Survey, which is a monthly survey fielded to 60,000 households that are going to yield about 100,000 individual responses. You can divide everybody in it into three groups of people. Employed, unemployed, and not in the labor force. So if you're employed, you have a job, you're being paid and you're at work. If you're unemployed, you don't have a job. But you had to have looked for a job, done something to apply for a job within the last four weeks. And then not in the labor force is everybody else, meaning that they're not working and they didn't look for a job in the past month. And that's where we get the employment rate, the unemployment rate, the labor force participation rate. That's all off of this official measure. But for underemployment, you basically peel people off of some of the other groups. So of people who have a job, you're gonna have people who say that they're working but they don't have enough hours. And this is called part time for economic reasons, sometimes called the Peters. And the Peters are people who are part time, either because they reported they were looking for full time work but only found part time work, or they have a job and they're only getting part time shifts. So we have two measures of part time for economic reasons and they're listed as employed, but they're basically underemployed in the sense that they're not getting enough hours. Then for the group of people who are not in the labor force because they're not actively looking for work, the survey asks, do you want a job? And if it says yes, they ask like, well, would you be able to take a job if one was offered to you this week? And if you say yes again, they then Ask you why you aren't actively looking for work. The people who want a job, who could take a job, and who have looked for work not in the past month, but in the past year, these are called the marginally attached workers. The largest subset of the marginally attached are called discouraged workers. People who say they want a job and they could take a job, but they haven't looked in the last month because the job market is so bad. We call these the U6 measures. There's actually six measures of labor underutilization, and they're put together in what's called the table a. 15 alternative measures of labor underutilization. And there's six measures. U1, U2, U3, U4, U5, U6. The official unemployment rate is U3. The official underemployment rate is U6, which right now is 7.9%.
- [30:14]
B
That seems high. Is it high?
- [30:16]
C
It's always higher. It doesn't average double. It.
- [30:19]
B
It varies double of the regular unemployment rate.
- [30:22]
C
Well, the unemployment rate is 4.2. The underemployment rate is 7.9. And the kind of typical relationship between the unemployment rate and the underemployment rate varies based on how bad the labor market is, but it tends to sit just under twice unemployment, which is kind
- [30:40]
B
of where it is now.
- [30:41]
C
Which is kind of where it is now. What will happen, like, if you have a recession and unemployment goes up? This number goes up, too. And it depends on the labor market recovery, how long it takes them to recover of, like, which one falls faster.
- [30:58]
B
Okay. And does that tell us anything? I mean, if they generally move in
- [31:02]
C
tandem, it tells us so much. They don't, like, cross each other. It's not. It's not like anything like that.
- [31:09]
B
Lots of people have jobs, but everybody's discouraged all at once.
- [31:14]
C
That would be remarkable. What I'm really talking about is, like, the slope of how much is improved, because in order to be unemployed, you have to be actively looking for work in the past four weeks. And so what happens is that a lot of people move from underemployment into unemployment because they've stepped up their search. So you can move between the measures. If you move from officially unemployed to kind of officially underemployed, you can move between them. And so that can affect the measures as well. Of, like, well, I've now stepped up my job search, and so I'm not discouraged anymore because I'm actively looking.
- [31:55]
B
I mean, you may be discouraged emotionally, but you're not categorized that way.
- [31:59]
C
Oh, this is. Yeah, I'm sorry, this is not like, what is it called? Emotions. How do y' all say it? It doesn't talk about that. This is how we describe your labor market search intensity.
- [32:10]
B
Got it.
- [32:11]
C
Okay, so what should have been a short answer, but because I'm giving it is ungodly long. What we do not have, and what I would augur we will never have is a measure of underemployment that relates to skill mismatch.
- [32:26]
B
Right. Which on the flip side of things, I think is sometimes called over education. Right. You have a training or certificate or degree that you're not putting to use in the labor market. And this can be measured as you have a BA and you're working, you know, driving for a ride share company or maybe even working in construction, though you have a college degree.
- [32:49]
C
Yes. And I think, like, I understand why people want to measure that as, like, hey, this labor market's not as good as you think because I had to take this job. That's beneath me. But I think that you have to, like, switch perspectives to a census enumerator where someone looking at survey data has to decide as a rule what makes someone overplaced in a job. And that gets really fascist really quickly. If there were a, like, schema for deciding who's underemployed. I am underemployed right now. I have a degree that I'm not using in my current position. If my occupation shows up as podcast host, they're going to be like, well, this girl failed down and like, she never used her PhD. And I get written off as underemployed for the rest of my career simply because I decided to change past.
- [33:46]
B
That's true. I should be a high paid Hollywood screenwriter by this measure.
- [33:49]
C
Yes.
- [33:49]
B
Yeah.
- [33:50]
C
What a failure you are. I mean, I think the problem with operationalizing this measure of you have training that you don't get to use on your job is it puts a ton of emphasis on the training and the credential. Not whether you liked it, not whether you wanted to use it, not whether you found something that fit you better. But like, sorry, Robin got a screenwriting degree when she was like, at the tender age of 21. And here she is, 55, still underemployed. Like, that's the risk is that we don't have a way to classify people into jobs that they want or suited for. What people are getting at with, like, I work in retail, but I have a college degree is that you're dissatisfied with your job and there's not a way for an Economic measure to really get at that. What you would really want to see is some type of question added to the current population survey, similar to part time for economic reasons or marginally attached discouragement. You would want to have some type of question that is be able to be constructed into, like, the U7. The fabled U7.
- [35:00]
B
The U7 doesn't exist. You're just imagining a U7.
- [35:02]
C
Yeah. I'm doing, like, a fantasy draft for the Bureau of Labor Statistics of. I will have a U7 measure that asks people, you know, a pretty subjective question of, did you have to take a job that was beneath you? And I think that it would. This is gonna sound so bad. I think it would be much less interesting of an indicator of labor market strength than people think. And I think what it would end up showing you is a different 30%
- [35:30]
B
of people are always dissatisfied with their
- [35:32]
C
job or that there are a lot of people of color or women who are shunted into positions that they are overqualified for because there is rampant discrimination in the labor market, which we have, like, very good evidence and proof of. And this is a manifestation of it separate from how we typically measure labor market discrimination. This would be a way to consistently measure labor market discrimination. And in fact, a lot of people have used the Current population survey to glean essentially to what degree this occurs. And it would fit as a good measure, but I don't think.
- [36:06]
B
But it'd be a measure of discrimination, not a measure of, like, impending recession or.
- [36:11]
C
I think it's a. I think it would serve probably more as a measure of labor market discrimination and less as some type of indicator. I understand that if the labor market's not doing well and you end up with a job you don't like, you feel like you're being ignored or that your situation is so much more dire or that you are the bellwether for an economy that's failing. I don't know how to say quickly that it's probably not true. I'm so sorry. Because people end up in different jobs all the time.
- [36:42]
B
Yeah.
- [36:43]
C
You know, and people take jobs that are beneath their skill level or people get credentials that they. Yeah. Or they. Or people get credentials that they don't like or that they don't want to use.
- [36:54]
B
Yeah, it's. I think it's also interesting because we push so hard for people to get degrees that are really career track. And if you. And you're making some decisions, like a BFA in screenwriting, that maybe you realize pretty quickly are not really the path for you, but you still gotta get the heck outta college in four years.
- [37:12]
C
You know, it's funny, when the unemployment rate was developed, like in the 30s, people brought up that they weren't being seen by the unemployment measures. And it comes up almost every recession of, like, you're not counting correctly because I'm hurting and I don't count. It always comes up. I think it's like, as like, foundational a component of the unemployment rate that people that it bothers is an incredibly powerful indicator of how our economy is doing, and it doesn't cover everything. And for the people who feel like they're not counted, I'm deeply sympathetic because I think unemployment's origin story is a little bit like a kind of a twin narrative that kind of like GDP. It's the 30s, we're in a depression, and we don't have a measure of the unemployment rate. We should probably get one to figure out if our economy is recovering. But at the same time, the early days of the unemployment rate were often like social workers and advocates on the ground trying to come up with a measure of labor market slack in order to advocate for better policy for people. And so it's always had this dual role of the government trying to get a sense of what the economy is doing and people on the ground trying to advocate for better policy and attention to their own cause. I don't know. I don't want to be one of those people that's like, you know what, Sonny Jim? In my day, we had to invent the unemployment rate to get people to pay attention to us. But there is an aspect of, like, we don't realize that it was its own type of social progress to get the federal government to measure it in the first place. Yeah, I mean, if you go back to W.E.B. du Bois, he writes a treatise, the Philadelphia Negro, and he is writing about the conditions of freeborn blacks and freed slaves in Philadelphia. He talks about unemployment and he surveys people in the part of Philadelphia that he's discussing, and he asks them about their unemployment. Because there was no one from the federal government knocking on doors who cared about whether or not black people found jobs in Philadelphia. It was part of his advocacy to show in his illustration of the problems facing black people at the turn of the century, that what was attributed to the failings of an inferior race were, in fact, economic problems like they could not find work. But if you didn't have an unemployment rate, you couldn't say it was the bad economy. You would just have white people in Washington look down and Say, well, that's what black people do. I mean, he estimated an unemployment rate specifically to advocate on behalf of black people and their economic situation as a source of, of social challenge. Du Bois was doing that 130 years ago. The settlement house workers did the same thing where they published this study called.
- [40:02]
B
Sorry, the Settlement House Workers that's in. Is that in Chicago?
- [40:05]
C
Oh, there's a bunch of them. You might have heard of Hull House, the Henry street settlements, various institutions and urban cities, mainly in the north, where women were doing social work and education and like childcare in very poor parts of town. They were called the Settlement House movement. Hull House in Chicago, founded by Jane Addams, is the most famous one in the US but they had a whole national federation of settlements where these women social workers spread out across these urban centers would be coordinated into action to research something or so on. So they started doing case studies of unemployment in the late 1920s because they thought that the roaring twenties was wrong. Not all that, but it wasn't. It was not all that. And they interviewed 150 people about unemployment to try and illustrate that unemployment is something that happens when the economy is good. And at the time it was thought that the only people who became unemployed was when there were mass shocks to the economy. And they were trying to compile these portraits of mainly men who were out of work and what happened to their families as a result in 1928, in order to show that it is actually the nature of our capitalist economy that we always have unemployment and it's not just something that happens in recessions. So it's. The unemployment rate is one of the biggest advocacy tools we have for a lot of avenues of social justice kind of in the grand scheme of things. And so it's such a victory that the BLS measures so much.
- [41:39]
B
So when do we actually. We actually didn't start measuring unemployment regularly until sometime in the Great Depression, is that right?
- [41:47]
C
Yeah, in the 30s. So the census Bureau had added questions that would kind of get at unemployment as early as the 1880 census. It was not like what we would think of unemployment today, but they did start asking about this notion of that, like people could be working but not at work. And they asked it in every census. 1880, 90, I want to say 20 was the one that they were like, well, we don't need to do it anymore because the economy is amazing. And of course there was a recession in 1920 and they didn't ask about it. And then they picked it back up in 30. And the census in 30 was like the unemployment rate's 5%. And people are like, what on earth? And so they immediately had to go back and do it again and change their questions because people were so upset that they weren't being counted. And then they, around this time they changed how they did it. Right before that it was really truly a census. But with advances in statistical methods, they realized they could do a survey and then estimate the national rate based off of a subsample of the population being surveyed. And so they, over the course of like 31 to 37, they start refining their methods, putting out a bunch of censuses and surveys and samples and come up with what will become the Current Population Survey.
- [42:58]
B
Does the Current Population Survey's origins, are they actually in unemployment? Yes, because we ask so many things about homeownership and income levels and I don't know, there's like a gajillion questions in that survey. And its sort of foundation is people being out of work in 1930.
- [43:15]
C
Yeah, it was started as the monthly report on the labor force and it was fielded in 1939. And that was the result of like six years of different experimentations in surveys to estimate the unemployed over the course of the 40s. It goes through a bunch more changes and it becomes what we think of as the Current Population Survey. We have a historical unemployment rate measured identically in terms of methodology going back to 1948.
- [43:43]
B
Is that atypical in developed economies?
- [43:47]
C
A lot of other countries liked the way that we did it and so they adopted it. But I mean, the Depression, we just didn't have it. And what's crazy is that this is absolutely a failing of the economics profession. Economists at the time didn't really have like a theory of unemployment. It was just like in work, out of work. And it was really social workers and government bureaucrats and statisticians who were out like raising the idea that you could have an able bodied person who could not find a job. And it's not that economists didn't understand that it exists. They just didn't have a framework for understanding where it came from.
- [44:26]
B
Really.
- [44:26]
C
Yeah, I mean, it was a really new profession.
- [44:29]
B
Yeah, I mean, I guess you've said that before that like economics as a profession really only kind of starts in the early part of the 20th century.
- [44:37]
C
I think the founding of the American economic association is 1885. And we didn't have the same kind of like constructs of looking at the world. I mean, economics is very much like start from theory and work back to reality. And it was people who lived in reality who were like, hey, but yeah, like, when the unemployment rate was established, people hated it. So I thought I would.
- [45:01]
B
Wait, like, what kind of people?
- [45:03]
C
So one of them was a guy who was an economist. He said, the single all use measure of the Works Progress Administration is not unemployment at all, but some magnitude of illegitimate conception with courtesy title. The father of the magnitude is more likely to be statistical expediency than economic theory, social philosophy, or even government policy. Put into today's words. You just came up with something you could measure. It's not. It doesn't mean anything for you movie buffs. That guy, his name was Clarence Long. He actually became a member of Congress. And he features prominently in the movie Charlie Wilson's War because he is the chairman of the committee that Charlie Wilson works for, AKA Doc Long. If you love Charlie Wilson's War, which I think is an underappreciated movie, I
- [45:54]
B
don't think I've seen it. I should go put it on the list, really. Right after this. Beverly Hills.
- [45:59]
C
I would argue that Charlie Wilson's War has top three Philip Seymour Hoffman performances.
- [46:05]
B
And that's big talk. Cause he had some great performances.
- [46:09]
C
It's partly that they gave him such a good role. Like the role he has in the movie is a disgruntled CIA employee. And it's like, my God, does he step into it? He has so many great lines. He has so many great clips. And I mean, you know what? What? This is a podcast. What does it matter? I'll stand by it. Philip Seymour Hoffman's performance in Charlie Wilson's War is a top three. Psh, performance. I'm just gonna. I'm just gonna.
- [46:36]
B
It's appropriately qualified.
- [46:38]
C
So, yeah, I mean, this is a podcast. We just get to say things sometimes. Anyway, I wanna say, I realize the irony here in that I'm saying, like, we have this, like, big victory in all these things that the federal government counts because it's a. Take a breath before you say it, Katherine. Arrow in the quiver of. Yeah, it's the arrow in the quiver of so many social justice movements to be able to point to their unemployment rate, their underemployment rate, the wages that they have. And getting the government to measure and produce this publicly with full transparency is so amazing. But that doesn't mean the measure is perfect. And so I understand that. I'm like, it's great that they do it. They don't do everything, and it has problems. Also, economists weren't really at the table. Like, there's A lot going on. But anyway,
- [47:31]
B
I mean, it's kind of an interesting or difficult moment to be discussing this because of what's going on with the Bureau of Labor Statistics and whether or not we're going to be able to improve the way we measure things or change them or whether they're going to get manipulated.
- [47:47]
C
But I know it's hard for me to speak flatly about it because what the BLS produces monthly and what it represents is so incredible. Not just because the stock market bets on what the jobs report says every month. They'll find something else to bet on, like that's what they do. Not because it's just telling us about how the economy is doing, but it is. Every measure of inequality that we have comes from the Census Bureau. It comes from the Bureau of Labor Statistics and what we are able to produce. You have a monthly measure of how much women work relative to men, how unemployed black people are compared to white people. Right. The attack on statistics is an attack on accountability that risks so much more in terms of what most people care about than just they say, I have a job, but I don't like my job because I have a college degree. But I work at Starbucks. I think we should always use Starbucks, by the way. I don't think they're going to sponsor us. And so they can both be our pinnacle of beauty.
- [48:48]
B
We don't have to use Uber or anything. We can just use Starbucks.
- [48:49]
C
We don't have to use anything. I was like, it should just always be Starbucks. Because both are like the pinnacle of union busting. They are also a relatively low wage employer. People think of like, yeah, like that's
- [48:58]
B
kind of the best of the service industry jobs because they'll let you take online classes at Arizona State, My former
- [49:04]
C
employer, the Economic Policy Institute, they did, in conjunction with the SHIFT Project, which is a big low wage workforce study, they did a survey of low wage workers and what companies they work for to come up with estimates of like the share of each company that is paid less. And Starbucks pays mostly lower than Walmart. So the stat I use is that now this is a couple years old, but when they collected the data, 41% of Starbucks workers made under $13 an hour, compared to just 27% of Walmart workers.
- [49:40]
B
What? Really?
- [49:41]
C
Yeah. God. I think the dissatisfaction with the economy manifests as the dissatisfaction with statistics, which is fine. Like, I also hate measurements sometime I live in them and produce them and research with them and don't like them all the time. But I think people lose sight of statistics Is power. Statistics from the federal government on inequality. That is power that we cannot replace. And I can. Yes, it sucks to get a job at Starbucks, we can all agree, but we live in a world that is better because we have these statistics. And so I'm with you. They're not perfect. And the ones that matter don't always get the airtime. But, like, you have to understand how much is at risk. Like, how much different the work of someone like W.E.B. du Bois would have been if he didn't have to go door to door in Philadelphia to try to convince people that black men could be unemployed as opposed to just shiftless. If you could just download a data set from the Bureau of Labor Statistics that tracked black men's unemployment, employment ages 25 to 54, without a high school degree, with a high school degree, with a college degree, with more than a college degree going back to the 70s. He didn't get to do that. That's power that researchers and advocates today have that nobody had back then, and they had to build it for us. So I understand being dissatisfied in the labor market and blaming the statistic, but we risk a lot by demonizing them.
- [51:08]
B
You know, it's funny because a few weeks ago, you were pretty optimistic that we could have a big, big, beautiful bls.
- [51:13]
C
Oh, we're definitely going to. Yeah. No, we're definitely going to. That is, the future is. We're going to have a one big, beautiful bls, and it's going to be. All the statistical agencies will be merged.
- [51:22]
B
I was going to say, you think the Census Bureau and the BLS and others will join forces. It'll be like the Super Friends.
- [51:29]
C
Yes. It is the most efficient, effective way to do so.
- [51:35]
B
Yeah.
- [51:35]
C
And it would, frankly bring other statistical agencies up to the standard that the BLS has. There's so much more to be gained, and we will gain it. Like, we will go forward. This kind of goes back to youth unemployment, and it kind of goes back to boys to men.
- [51:53]
B
Boys.
- [51:54]
C
Nailed it.
- [51:54]
B
To men.
- [51:55]
C
Boys to men. That I think that it can be hard to know that what you're struggling with is just the economy overall and not something specific to you. We can pick a group that we think is the most sympathetic, but that is not the most accurate. The hardest lesson, I think, to learn about the economy is the average does not predict individual experiences, and individual experiences do not negate the average. You have to hold these two things in your mind. That the average can be good and you're doing bad, and that you're doing badly doesn't mean the average is a lie. Here on this show, we believe in optimism, including a 45 minute segment where I explain to you why your problems are so small.
- [52:41]
B
They're not statistical.
- [52:42]
C
Statistically significant.
- [52:44]
B
I don't know. Does that help? Maybe.
- [52:47]
C
Hope that helps. I'm great at parties. I think the optimism here is that we do have a ton of tools at our disposal for advocacy and we're so privileged in what we have, but that doesn't make the economy perfect. And.
- [53:07]
B
Yeah, yeah. And inaccurate measures don't fix the economy.
- [53:11]
C
Inaccurate measures don't fix the economy. Like, we want them and we need them and we can make them better. And I have lots of thoughts on that, obviously. And we can do a whole segment on the one big, beautiful bls. But the biggest problem with the economy right now is that it's weak. And that's going to show up for all kinds of people in all kinds of ways. And some of those people are going to say the statistics aren't telling us everything. But it's such a weird time in the economy. I can understand the dissatisfaction with statistics, even though I will defend them to my last breath.
- [53:47]
B
That's the tattoo,
- [53:50]
C
man. I don't want a GDP tattoo. Get a BLS tattoo.
- [53:54]
B
I should have realized that.
- [53:55]
C
Of course, with their logo, with the chart that comes.
- [53:59]
B
Yeah, that's it.
- [54:00]
C
It's pretty good. Yeah. So BLS tattoos for some, Pilcrow tattoos for others.
- [54:05]
B
All right, time for executive orders. Katherine, what's your executive order?
- [54:13]
C
This is also a throwback to the Boys admin episode. Listen. Jane Austen turns 250 this year. And so there's a lot of Jane Austen movies being remade. And I am in full support of that. Like, I could not be happier about it. I think it's good for society, I think it's good for the world. But I do think that we need to have, like, regular remakes of Lady Chatterley's Lover.
- [54:35]
B
Really?
- [54:36]
C
Because that is a story about a rich lady married to a wealthy industrialist and she leaves him for a less educated man of the earth, Oliver Millers. And we just don't have many stories about women dating men who come from a lower class than them. Oh, and in the book is. The book has like a ton of sex in it, which is fine, but it was more shocking at the time because she leaves. Well, spoiler. She leaves Lord Chatterley for the groundskeeper.
- [55:10]
B
It is in the title.
- [55:11]
C
Some people would say that Oliver Mellor is a himbo. I don't know if I would agree with that. Like, he's a man of the earth. Like, I couldn't be a groundskeeper. He has his own skill set. But, yeah, we need to remake Lady Chatterley's Lover with regularity. Different settings, different time periods, but the same idea that, like, sometimes the rich guy who makes a lot of money blows and is cruel, and you're gonna want to go with the salt of the earth, blue collar guy.
- [55:40]
B
That sounds good. That sounds good. My executive order, actually, I'm endorsing one from a guy named Brian in New Jersey who says if a business has double doors, both doors must be unlocked and available to use. I'm tired of one door being locked. You're just causing a bottleneck. I can't tell you how many times I have just, like, been brought to a complete halt trying to go in a door that is, in fact, locked, which just makes me look like an idiot. And it happened to me last weekend at a taco restaurant that will remain nameless.
- [56:13]
C
But for now.
- [56:13]
B
For now. Because I do like their tacos. But. Yeah, Brian, I'm with you on this. And endorse.
- [56:20]
C
Endorse anything that makes me feel like less of an idiot as I wander through this earth.
- [56:25]
B
Please, just help me out.
- [56:26]
C
Can we do that?
- [56:27]
B
Help me out.
- [56:27]
C
Can we do that? Please?
- [56:28]
B
Can I not nearly sprain a wrist trying to, like, walk full speed into this door? Okay. Spiritual sponsors.
- [56:38]
C
Spiritual sponsors.
- [56:38]
B
Spiritual sponsor this week, Catherine.
- [56:41]
C
My spiritual sponsor this week is the drumline at Houston Dash home games.
- [56:46]
B
They have a drum line.
- [56:48]
C
They have a drum line. Yeah. If you've gone to soccer games in the United States, you know, it's pretty typical to have a fan section that includes a drum.
- [56:56]
B
Some drummers.
- [56:57]
C
Yeah, yeah. One or two drums. Yeah. This had. This was like a coordinated drum line. It wasn't like 15 people. It looked closer to six or seven. They did lean hard on Poison. But what. I will say that what blew my mind is, like, not that long into the game, one of the Dash players gets a breakaway, and this drum line steps up the beat. So it's like a rising action soundtrack to what is happening in the soccer game. And I was like, my little brain cannot handle this. And my husband, who's a musician and was in orchestras, he was like, these guys are good. They are very, very good. We moved to sit closer to this them. My spiritual sponsor is the Houston Dash drumline, and I appreciate the professionalism, the nuance, the subtleties, the highs and lows. Yeah. Oh, my God, it was so good.
- [57:53]
B
My spiritual sponsor this week is Summer fruit. We're at peak summer fruit season and I mean, I had life changing peaches from the Hollywood farmers market last week and the raspberries, it is not the cheapest fruit you can get. You can get, but it is. Is life changing fruit. And we come back with just bags of fresh produce. And I'd give up chocolate in a heartbeat if I could just have fruit like that every day.
- [58:21]
C
I feel that way about bread. Like fresh baked, really good bread. Yeah, that's. Well, bread's my favorite food, so I think that makes.
- [58:31]
B
Yeah, but bread's good too. But it's snow peach. Okay, throw down.
- [58:39]
C
This is how it all ended. We almost had a full season in the can.
- [58:44]
B
We began to fight about food. Thanks again for making it to the end of the show.
- [58:53]
C
Thanks again for making it to the end of the show. Tell us what you thought@optimist.eilibrium Gmail.com. visit us at optimisteconomy.com. send us messages, comment on the videos. You know, let us know what you think. We love being in conversation with you, but we need to give just an incredible snap out to Andy and Sophie. Y' all listen to this episode and you have no idea how many times my child came in and interrupted us sobbing. And that's because they're professionals and I am not.