How Much the US Economy Has Recovered for Most Workers

If I understand the argument you are making correctly, what you want in place of the chart you are showing is the Civilian Employment to Population ratio.

What you are showing is the civilian labor force participation rate, which is defined as the percentage of the population that is either employed or unemployed.

The Civilian Employment to Population ratio, which is the portion of the adult population (16 years and older) that is employed seems more on target. That chart is available from FRED
https://fred.stlouisfed.org/series/EMRATIO

It is a more dramatic illustration of your thesis.

This one from FRED via Wikipedia is also useful: It compares Employment to population with the unemployment rate.

https://en.wikipedia.org/wiki/Employment-to-population_ratio#/media/File:Unemployment_and_employment_statistics_for_the_US_since_2000.png

Alex:
Shadowstats are 95% garbage.

We have to stop doing what we doing. It isn’t working.

“When making money is, in effect, guaranteed, capitalism stops working in anything close to a beneficial fashion.”

Isn’t what you describe in the article what capitalism is all about? making money (at all cost). Perhaps a different terminology may be more apt, Corporate planned economy vs free market economy.

Phil:
Shadowstats is one source. It catches flak for GDP calcs, but not unemployment. I find the ones tearing into SS are mainly MSM hacks defending the establishment line of “prosperity is just around the corner”. Yes, of course it is.

The BLS is producing some very questionable numbers and has been by not counting unemployed people.

Go back to the Great Depression and unemployment was calculated very straight forward:
Labor Force Unemployment Rate = unemployed / labor force
For 1933, it was 24.75% = 12,830,000 / 51,840,000
http://www.u-s-history.com/pages/h1528.html

Today, the numbers go into a black box and voila, a full employment number comes out. Yes, of course it does.

At the current trend, we’ll have negative unemployment rates which means there are more jobs than people.

What makes it even more ridiculous is some BLS number can be changed for up to 5 years afterwards.

Obama only created 10,479,000 jobs over eight years. Nothing to write home about.

I asked Mike Kimel (Angrybear contributor and Presimetrics author) about Obama and he said:
Obama has broken the patterns of behavior we noted in the book, at least when it comes to the economy. He has maintained GW’s tax policies, particularly early on. He dealt with the Great Recession the way GW was doing it rather than the way FDR did it, so the economy has grown GW-ish (i.e., lukewarm) rather than FDR-ish (i.e., an actual bounce back from a major downturn that included several years of the fastest peacetime real economic growth in this country’s history).

Alex

Go back to the Great Depression and unemployment was calculated very straight forward

They were? The Great Depression unemployment stats weren’t calculated ‘in a very straightforward manner’ at all, they were based upon Stanley. Lebergott’s estimations, as real, hard, data did not exist during most of the depression. Lebergott’s employment stats excluded people who served in the armed forces and people who had relief work as not having ‘real jobs’ so his unemployment figures have been criticized as inflated.

My point above — about how, even if we can see meaningful trends like those highlighted in the OP, the economy still seems to conventional wisdom as something chaotic and impossible to predict let alone control — is well-illustrated by collective memory of and even professionally-written histories of the Great Depression.

I do not think there is commonly available, a good, sound understanding of what the Great Depression was, and what caused the Great Depression as an economic event; nor how the New Deal addressed those causes. I am not saying I understand it and you, dear Reader, do not. I know some things, but I do not have a lot of confidence in my depth of understanding. I am saying that there isn’t a good shared historical view, and, in particular, Left views of economics and economic history is particularly impoverished by not having any well-informed consensus view. The reactionary Right has had some ideas — most famously, Milton Friedman’s monetarist blame-the-fed narrative — to combine with their general hostility to the New Deal reforms. But, left-liberal views seemed to have withered in the 1960s and died out in the 1970s, the memories simply gone from politics. Galbraith to Polanyi were, imho, somewhat weak analyses, and then, they just fell out of memory entirely.

Ian says, “When we want to have a good economy that helps everyone again we will have it. Until we do, we won’t.” I wonder, who is “we”?

The Great Depression and the New Deal was one long political struggle, which continued in stalemate thru the 1930s — a struggle over the distribution of resources, wealth, power and income, and because of the imperatives of the War, the liberal-left ended up largely winning that fight. But, it was largely a stalemate up to 1938-39 — Lebergott’s unemployment numbers reflect the sense that that was the case, a sense that faded during and after the War.

Some people — powerful people — really do not want “a good economy” as Ian Welsh or I would understand “good”. “A good economy” for the many would be an obstacle rather than a means to their power and status, the power and status of the 0.1%. So, “a good economy” for the many requires not just wanting it idly, but being able and willing to organize politically to fight for it.

Being willing to fight for a good economy and actually getting a good economy also depends on having clear, sound ideas of what institutional means to a good economy can be devised and put into place.

Some good ideas are beginning to emerge: $15/hr minimum wage, single-payer. Some may not be all that sound (MMT, I am looking at you) and others, like a path to dismantling the global free-trade regime or a new concept of antitrust or new approaches to policing property ownership are barely emergent.

Politics is a fight, and often a knife fight in which you cannot trust your friends — et tu, Brute and all that! Post-2016, it is pretty clear that many in the professional classes — the 10% — are eager to protect themselves and their relationships with the plutocracy, the 0.1% The rich have gone from hiring half the working class to imprison the other half, to hiring more than half the professional and managerial classes to starve and imprison the rest of us. So, lots of scorn for the unwashed, less-credentialled masses from the new bourgeoisie; lots of “it’s complicated” claims whenever anyone threatens the complex supply-chains of globalized trade (alongside charges of racism against the deplorables, natch).

We may want “a good economy” but we are not going to get it from the erstwhile supporters of Hillary Clinton and the Democratic Establishment, any more than we are likely to get it from Donald Trump.

Just to clarify a point I wanted to make in my previous comment, but then lost track of:

Ian’s statement, “When we want to have a good economy that helps everyone again we will have it. Until we do, we won’t.” is a sentiment that applies to the 10%, the well-educated professional and managerial classes who have the means to conceive of and implement a good economy, but choose to conceive and implement instead the neoliberal utopia sought by their patrons among the global super-rich and powerful business corporations. These are the people who organize the political process, staff the bureaucracy public and private, people the Media as executives and pundits, supply our opinions and provide authoritative “expertise”.

Alex: “the 1% are following John C Calhoun’s and James Buchanan’s ideas. There is little to no opposition to this by the public.”

I do not know about Calhoun, but presuming you refer to faux nobelist, James McGill Buchanan, Jr. and not the antebellum President, then possibly. The 1% have benefited from the advice and ideological propaganda of some very conservative economists. And, there has been remarkably little effective pushback from the soi disant left, either on an elite level or popularly.

This asymmetry, where class warfare has been carried on by one class only, is the story of neoliberalism. In academia and in the political media and elsewhere, the left quit the field and the right carried on.

Paul Krugman presents himself as a liberal, but he is, in fact, also a conservative economist. When Ben Bernanke was brought in to manage the then prospective financial crisis, very few nominal Democrats expressed concern, and even after he had done the deed expected of him, he got the support of Krugman, Mark Thoma and others for Obama’s renomination of him. Obama pressed for TPP to the end of his term. I could go on and on, about all manner of wonky reforms that have served to dispossess the masses, from the end of usury to the bankruptcy reform Hillary supported to resale price maintenance to ip law to the now pervasive circumvention of the corporate income tax. That the left complain of the abstract and bloodless “inequality” instead of more passionately attacking specific predatory patterns is an indication of how little appetite for a fight exists.

Bruce:
Yep, you’re 100% on the mark. I hope people learn a lesson about fake Democrats like Obama and Clinton, but most have short attention spans.

**

Hugh:

I agree with most of that. But some things don’t change, and manipulating numbers to hide the bad, is common through the ages.

One of the very first things I wrote about back in 2013, was the boom-and-bust cycles of the US ( http://newdealprogressives.org/blog/2013/08/11/what-a-21st-century-new-deal-would-look-like/ ):
—
There are six other depressions on record in the US since 1789:

1807-1810
1815-1821
1837-1844 (the Long Depression)
1873-1879
1893-1898
1920-1921

There have been 47 recessions on record since 1790. What the MSM (mainstream media) and politicians call The Great Recession of today is actually another Long Depression with unemployment reaching Great Depression levels.
—

The US needs to change its’ economic system.

Btw, the BLS has jobs data back to Jan-1939 ( https://data.bls.gov/timeseries/CES0000000001 )

and

GDP data back to 1930 ( https://bea.gov/iTable/iTable.cfm?reqid=9&step=3&isuri=1&904=1930&903=1&906=a&905=2016&910=x&911=0#reqid=9&step=3&isuri=1&904=1930&903=1&906=a&905=2016&910=x&911=0 ).

So they were keeping track of some things back then.

During the Ford admin in 1975, they created Not in Labor Force ( https://data.bls.gov/timeseries/LNS15000000 ).

It remained steady from Jan-1975 with 58,627,000 to Dec-1992 with 65,230,000, an increase of 6.6 million.

During Clinton’s term, it jumped 4.6 million to 70,489,000 and by Dec-2016 it jumped 24.6 million to 95,102,000. It’s apparent that Clinton & Rubin made changes that caused the increases in NILF and lowered the unemployment rate.

In 1994, they also created Marginally Attached Workers and Discouraged Workers; more buckets to hide unemployed workers.

In 2013, Obama ordered the BLS to stop counting mass layoffs.

I would say the BLS probably needs to update some things, but it has had some undue influences on it which caused the current problems.

Alex, the CES (Current Employment Statistics) comes from the Establishment/business survey. It is the one I tend to use more now. The CPS (Current Population Survey) is much smaller, much less accurate, but often better at showing near term shifts in the labor force. It is the one that measures the participation rate and employment to population ratio.

Ultra,
re 1), the jobs/skills mismatch has been largely debunked. If such mismatches occurred and were significant, they would show up within industry sectors, but real unemployment, not the fictitious metric the BLS currently is using, occurs across industry sectors. And, of course, industry has always had two very good solutions to such mismatches where they occur: train current workers and pay them well enough to keep them. *gasp* I know how shocking.

re 2), are these the same workers who are getting extended education for jobs that don’t exist? Those who can afford such a route are increasingly from the top 20%. The rest of us have to eat which rather increases the emphasis on work.

re 3), declining birth rates have been offset by increased immigration. Also more than 15% of the current US labor force is foreign born.

re 4), the civilian noninstitutional population over 16 already does not include those under 16. As I noted above, there is a Boomer effect on the overall participation rate, but it doesn’t explain the decline in participation rates among younger workers.

re 5), the CPS is a self-reporting survey and does measure the self-employed. So it very likely would pick up such increases. Thing is the number of self-employed has not been showing any dramatic increases. I forget but would guess that currently the self-employed account for less than 10% of the labor force. Their numbers have changed little over the past 15 years.

re 6), the CPS does track foreign born workers, but not their legal status. The CES does neither. The civilian noninstitutional population is over 250 million. So a 1% change in the participation rate involves over 2.5 million people.

re 7), don’t understand the point. See 6).