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Economy looking up

So unemployment is going down at last.

In addition, starting salaries for new grads are on the way back up after stagnating for a few years:

http://money.cnn.com/2004/02/05/pf/college/lucrative_degrees/index.htm?cnn=yes

A student with no experience and a CS degree can now expect to pull in fifty thousand for his first job.

Dennis Atkins
Friday, February 06, 2004

"A student with no experience and a CS degree can now expect to pull in fifty thousand for his first job."

And a 35 year old with 10 years of experience can now expect to pull in seven fifty an hour for his first job at Starbucks.


Friday, February 06, 2004

You read CNN????

AJ
Friday, February 06, 2004

Actually unemployment is probably not falling.  The unemployment rate that you see is not a reflection of reality.

It is falling mainly because most unemployed people's unemployment benefits are ending.  Even the extended benefits.  This means that those people are now counted as "have given up looking for work" when in reality most of them are still looking.  That statistic is not represented in the unemployment rate the government reports.

If you look at how many people were actually hired by businesses you would see around 1000 or so.  That is obviously not a lot of people.

Basically the unmemployment rate will keep dropping.  This only means that companies are no longer laying people off.  It does not reflect the acutal number of unemployed nor does it mean that companies are hiring.

Tester
Friday, February 06, 2004

What accounts for the starting salaries going up then? If there is a glut of unemployed, you would think salaries would continue to drop. Perhaps they have bottomed out? Seems unlikely though since 50 grand doesn't sound like much of a bottom.

Dennis Atkins
Friday, February 06, 2004

On one hand I won't believe the unemployment figures until I see a trend along with a positive number of new jobs created.

I don't have the figures handy, but the December numbers showed a drop in unemployment rate yet zero growth in new jobs.  The January numbers show a drop in unemployment rate plus 112,000 new jobs added to the economy.  But one data point does not make a trend.

On the bright side, the local newspaper has averaged 2-3 columns of IT job listings for the past year+.  Recently it has grown to 4-6 columns.  Likewise, the local .Net user group's website had maybe 6 job posting all of last year.  there were 5 postings this year in January alone.  Whether the majority of people are hired through networking or not, it's still a pretty good yardstick for measuring local economic health.

Student A
Friday, February 06, 2004

>>> It is falling mainly because most unemployed people's unemployment benefits are ending.  <<<

Why do you believe this?  The Bureau of Labor Statistics http://www.bls.gov explicitly states that this is not true.  The numbers are obtained from surveys.

mackinac
Friday, February 06, 2004

50 grand doesn't sound like much of a bottom, does it.  OTOH, I think the article actually said 48k and IIRC back in 1990 the average starting salary was about 42k, so that would be a growth rate of about 1%.  I doubt that beats the inflation rate.

The other thing to consider is where the new hiring is occuring.  Often tech job hiring is strongest in areas with a high cost of living, which skews the averages.

Observer
Friday, February 06, 2004

A significant distorting factor in unemployment statistics is the increasing casualisation of many sectors, especially IT. Someone earning $10 per hour for eight hours a week gets counted as "employed."

In IT, the rates for a lot of contracting jobs now are similar to pro-rata staff pay rates, which means those jobs are paying much less than staff jobs. This also is part of the casualisation of the workforce.

Mackinac, official employment statistics do indeed exclude those considered to be no longer "looking for work." Surveys by independent firms frequently have vested interests at work and are generally not reliable.

LM
Friday, February 06, 2004

>>
Mackinac, official employment statistics do indeed exclude those considered to be no longer "looking for work."
<<
Yes, but I don't believe that is as trivial as "everyone whose benefits have run out". That is so lame and useless even your average social "scientist" wouldn't use that.

sgf
Friday, February 06, 2004

I always wonder why nobody every takes into account cost of living when quoting salary statistics. 50k/year in Southern California isn't that good, not good at all in the Bay area, and pretty bad in NY from what I understand.  But it's not so bad in Dallas ...

Immature programmer
Saturday, February 07, 2004

The economy as it relates to the bottom line of large corporations has been doing great recently.

The January government numbers that show a drop in the unemployment rate plus 112,000 new jobs added to the economy doesn't really tell you much. What type of jobs were created temporary or permanant? What do they pay? Do they include benefits such as health insurance?


Saturday, February 07, 2004

At the bls site it loks like that 76,000 of the new jobs are retail sector jobs.  And as mentioned before discouraged and other "marginally attached" workers are not being counted for unemployment purposes.  Furthermore please remember that in any part of the country a retail sector job does not usually provide a living wage (see Nickel and Dimed: On (Not) Getting By in America by by Barbara Ehrenreich for more on this - amazon link -  http://tinyurl.com/3xbeo ).  Meanwhile we continue to ship quality jobs overseas and let large corporations loot the country. It strikes me that a jobless recovery is a lot like a foodless soup kitchen - useless to human beings in need.

K
Saturday, February 07, 2004

> I don't believe that is as trivial as "everyone whose benefits have run out".

They are practically the same thing.

LM
Saturday, February 07, 2004

>>> Mackinac, official employment statistics do indeed exclude those considered to be no longer "looking for work." <<<

This is correct.  As stated at the BLS web site that I cited earlier: " Persons are classified as unemployed if they do not have a job, have actively looked for work in the prior 4 weeks, and are currently available for work. "  This has nothing to do with their unemployment benefits running out.

mackinac
Saturday, February 07, 2004

"It strikes me that a jobless recovery is a lot like a foodless soup kitchen - useless to human beings in need. "

Jobless recovery...what an interesting term..I wonder who invented that term?

Which do you think comes first: The jobs? Or the recovery?

It's not as if companies just decide one day "Hey! I know what to do today! Let's go hire a bunch of people! That'll be fun!"

No, rather the economy slowly warms, businesses improve and then companies slowly began to expand again and start hiring.

Recovery first...then jobs.

Mark Hoffman
Saturday, February 07, 2004

Unemployment going down is largely being driven by the increasing numbers of self-employed and small businesses, not due to hiring by corporations.

But corporate hiring does seem to be increasing a bit in my neck of the woods.  I'm starting to see more and more people changing jobs; practically nowhere was hiring a year ago.

T. Norman
Saturday, February 07, 2004

And I think the high salaries for computer-related graduates is the result of opportunities now being restricted to the cream of the crop.  A large percentage of CS and CE graduates don't and won't have any prospects.

T. Norman
Saturday, February 07, 2004

Norman! VERY interesting. You are saying that although the average is higher, it is only an average of those employed in their field of discipline and/or it doesn't include those graduates who have no jobs or are working at McDonalds. Do you have any references that fewer CS and CE grads are getting jobs in tehir field?

Dennis Atkins
Saturday, February 07, 2004

Two points regarding the 112,000 jobs gained in January:

1. The sector that includes developers showed a LOSS of 22,000 jobs. See this chart:

http://story.news.yahoo.com/news?tmpl=story&u=/040208/photos_bs/payrolls_012004_detail_graphic

2. A gain of 150,000 jobs per month is needed simply to keep up with population growth. Therefore, under ideal analysis, the best we can do is say that there was a loss of 38,000 jobs, which is not quite as bad as previous months, but still indicates a collapsing economy and a sustained DEPRESSION.

Tony Chang
Sunday, February 08, 2004

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