2014 U.K. Edition
Just kidding; not you dear reader unless you work in app building, robotics or machine language; or as Tom Friedman says, "as long as you are not average". Oh and he also said "Think Like an Immigrant: "We are all new immigrants to the hyper connected world, and new immigrants are paranoid optimists. I better understand what world I’m living in, what the biggest trends are and pursue them with more energy, vigor and persistence than anybody else.”
It should be obvious to everyone that the trend is a new machine software revolution that is capable of replacing not only the middle but the top as well; and Mark Carney, new immigrant that he is, knows the trend.
The Bank of England will cut up to 100 jobs following a 'Value for Money' review, as part of £18m of savings to be made by 2016. The jobs will be cut from the bank's support division, known as Central Services, and equates to roughly 10pc of the workforce in that area. In total the Bank has roughly 3,600 staff. The review, launched last autumn shortly after the arrival of Mark Carney, the Bank Governor, looked at staff deployment and spending and identified savings of £18m to be made by 2016, roughly 10pc of the spending that was under review. Central Services will now be reorganised following the review, providing "new opportunities" for some staff, while other jobs "will not be filled as staff retire or move on". "It is envisaged that there will be between 80 100 redundancies, subject to staff consultation," the Bank said. "The Bank is working closely with the Bank’s union to ensure that affected staff will receive support to find alternative employment." The Telegraph Jan 31, 2014
How long do you think the divergent spread between earnings and housing unaffordability will last?
(see Demographia update for a 3rd party view of value)
The 3 charts above are EOY 2013. Current Charts are here.
Average is Officially Over
“If you cannot justify your singular ability to add value every day, you will be in trouble; that’s the big difference between us and our kids. We got to find jobs, they will have to invent them.”
"Countries that Enable will Thrive" (3.04min)
Or watch the Keynote by New York Times columnist Thomas Friedman at the 2013 Maryland Competitiveness Coalition’s Economic Summit "How the merger of globalization and the IT revolution is impacting the economy and the future of work." (47.43min) QUOTES:
"We're in California, isn't there a better way of doing that?" Elon Musk
The bottom 50% of most national populations is participating in less than 10% of its wealth, and the top 10% of populations is wheeling and dealing with over 50% of its national wealth. If you are in the bottom 50%, you are working at the wrong trade if your desire is to enjoy just some of the benefits of those above you; for instance more free time.
It's doubtful that in this period of history there is any point in waiting or voting for your governors to move you up the ladder because the 10% make up the rules of the game. The only remedy I can see is to retrain so that you have a skill that the top 10% needs and that the bottom 50% doesn't have.
Here are some high quality and free educational providers, Khan Academy and EdX to get you started and an interview with Elon Musk "A lot of education is vaudevillian" from April 17, 2013 at the Khan Academy office in Mountain View (48min).
Capital vs Labour
Thanks to Ted Kavadas rounding up these 3 charts (and 7 others shown here). In the past 30+ years since the peak in the cost to borrow, Capital has chased financial asset prices (housing, stocks and bonds etal) in bidding wars to record highs against yields plunging to negative return lows.
During this time frame, Labour has formed longer lineups as more and more jobs become a negative return on work/time. Why invest one's time in working for someone else if "unemployment" and grubbing about for oneself produces a similar quality of existence?
The past class struggles against the owners of the means of production ended either with revolution that restructured society or the common ruin of the contending classes. (paraphrased from the 1847 Communist Manifesto Wikipedia)
Well the North American "Spring" seems nowhere in sight, so forget the revolution. Perhaps the reset will be a "restructuring of the contending classes"; although that idea currently seems remote; a minimum wage increase or an asset mark to market is well lobbied against. Also the U.S. (and Canadian) federal governments are on a declared path of austerity as is Europe and other developed countries. As governments reduce spending the only alternative sources for investment in the economy are the private sector and trade. The trade balance is stubbornly negative.
CLICK CHART TO ENLARGE
Unemployment Ticks Up
Canada's jobless rate now 7.2%
"...it does look like there's been a little bit of deterioration since the start of the year." said Doug Porter, Bank of Montreal chief economist.
"In all, six of 10 Canadian provinces lost workers with Quebec's 30,400 setback the deepest fall-off."
CLICK CHART TO ENLARGE
"The agency (Bank of Canada?) pointed out that for the first half of 2013, job gains have averaged 11,000 a month.
That's far weaker than the 27,000 average gain the economy produced during the second half of 2012."
"It is also not sufficient to fill vacancies created by the natural growth in the labour force, which analysts estimate is between 15,000 and 20,000 a month. Under this scenario, it should be expected that the unemployment rate will rise unless a large number of discouraged Canadians drop out of the workforce altogether."
Quotes above from the Huff Post August 9th and the Montreal Gazette August 10, 2013
NOTE: It's the Canadian Energy sector that is attracting the unemployed migration. See the June 27, 2013 post "Hours vs Earnings"
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Part Time-Full Time, Male and Female Employment in Canada
STATS CAN Employment Data: In Canada, more women than men work at part time jobs (+/- twice as many) and both older men and women (45 years and older) are more employed part time than younger men and women (age 25-44).
In the category of full time employment, there appears to be a declining number of younger men (since about 1990) employed relative to full time older men who appear to have made and kept the biggest percentage gains in job acquisition.
With full time employed women the story is similar except that BOTH younger and older women have made large percentage gains in getting employment and for 20 years during the period between 1983-2003, younger women were getting more jobs than older men.
If the trend continues of greater productivity through technological advance and the wage disparity between men and women is not erased, we could see more full time jobs auctioned off to women who live longer than men.
The chart above (updated annually) is also located on the Earnings Page.
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Canadian Energy Sector Earnings Advantage
Average Canadians Work 30.4 hours per week, but if you work just 2 more hrs/wk in the Canadian Energy Sector Provinces, you can increase your earnings dramatically. Earnings chart here.
CLICK TO ENLARGE CHART
Zero U.S. Hiring Expected
Goldman Sach's via Zero Hedge
The National Federation of Independent Businesses (NFIB) shows 0% of their members planning to hire.
As reported in the previous post about Canadian business expectations for hiring, the demand for Labour continues to slump.
If you have a job and can supply a couple of years of employment documentation, you probably qualify for a big, huge, enormous mortgage. But if business operator's sentiment is plunging on both sides of the border, it means your income stream is at risk.
In a deflation, zero debt is preferred over zero income.
CLICK to enlarge CAD Unemployment & Trade
Unemployment in Canada is not unusual. As can been seen by the top chart to the left, the current (May 2012) unemployment rate is at 7.3% and since the early 1970's the unemployment rate has spent about 80% of the time at or above the current rate. So if the CRB continues to drop as a reflection of the global slowdown, then as hewers, drawers and diggers we can expect to see Canadian unemployment remain elevated. 10% or higher unemployment would not be unusual. Now if we look at the bottom chart we can see that the crash into the March 2009 Pit of Gloom has had a profound effect. Government price control policy has failed big time. The Canadian Trade balance is in deficit and likely to remain there as credit contracts globally. Low interest rates cannot by themselves create demand, and they certainly have not helped Canadians to learn how to be more productive. Imagine if Canadians actually made stuff out of all the resources we have.
Canada Unemployment (7.6%) January 2012
Unemployment in Canada ticked up in January 2012 to 7.6%. The near term low was in Q1-2008 when the rate dipped below 6%.
Employment increased in educational services; information, culture and recreation; and in "other services", such as personal and household services.
There were declines, however, in professional, scientific and technical services; and in finance, insurance, real estate and leasing.
History, Charts & Curated Readings
"Progress, far from consisting in change, depends on retentiveness. When change is absolute there remains no being to improve and no direction is set for possible improvement; and when experience is not retained, as among savages, infancy is perpetual. Those who cannot remember the past are condemned to repeat it." George Santayana Vol. I, Reason in Common Sense
"History, real solemn history, I cannot be interested in.... I read it a little as a duty; but it tells me nothing that does not either vex or weary me. The quarrels of popes and kings, with wars and pestilences in every page; the men all so good for nothing, and hardly any women at all - it is very tiresome." Jane Austen spoken by Catherine Morland in 'Northanger Abbey'