Workers are a critical component of any economy. Two centuries ago, when Adam Smith and his cohorts invented the discipline of Economics, they saw three parts to any Economy, Land, Capital, and especially Labor. Later economists would jettison “land” and include “technology” as a key to the Economy. But no matter what, Labor is always central in evaluating Economic Performance.
It may surprise you that our current Secretary of the Treasury, and former Chair of the Federal Reserve, Janet Yellen, is a Labor Economist. She is the first Labor Economist to hold either of those two positions. Her primary focus is on the productivity and well-being of the labor sector.
And how appropriate that a Labor Economist should be the government’s Chief Economic officer now. Because the US Labor markets are undergoing a massive transition, the likes of which we haven’t seen outside of a major war.
Each month, the Bureau of Labor Statistics calculates and reports on the number of Job Openings in the country. This may be the most puzzling of all the economic reports to cross my desk. And it has been since the Pandemic struck nearly three years ago.
I remember watching one of those stock market channels in 2021 when it was first reported that the number of Job Openings had reached 10 million. The reporters were gobsmacked. We all were. There had never been anything like this. The highest Job Openings ever achieved, just before the Pandemic, was 7.5 million. Yet here we were with 25% more open positions than ever. Now, these are jobs that employers can’t find anyone to fill.
Immediately Wall Street analysts were guessing at the cause. Could employers have gone on a massive hiring spree after the Pandemic? And there were now more jobs than workers? Or, were people getting used to staying home and didn’t want to return to work? Or was something else at work that was not apparent to the analysts? Incidentally, most analysts at the time thought that “wanting to stay at home” was why there weren’t enough available workers.
But it’s an important question. When nearly 2% of the entire American Labor Force decides not to go to work, that will significantly impact the Economy.
As the weeks have rolled by, we’re beginning to see the impact of these missing employees. It is a phenomenon that started during the Pandemic in 2020. Here I’m not just talking about Covid-19. I include the harmful psychological effects of self-isolation, the lockdown, the mental impact of losing a business or a job, and the adverse side effects of the vaccine. And, of course, the health effects of the Covid disease itself.
When you look at the numbers, they’re staggering. The CDC reports one million dead from Covid, VAERS reports 1.5 million injured from the vaccine, and the Labor Department reports a greater than 3 million increase in the disabled. Add all these together, and I was beginning to see why we had so many job openings with no one to fill those positions.
At that point, I decided to look at the correlation between Job openings and the disabled, and I’ve included the chart below. As you can see, it is a good correlation. And it goes a long way to explaining why people aren’t going to work. They’re disabled. Hopefully, this will show that the myth that people “would rather stay home” was always just a myth. People aren’t working because they can’t work. Simple as that.
But it points to a more troublesome issue. We are now two years after the Pandemic, and most of those workers remain disabled. There are newly disabled being added to the list daily. The numbers are increasing, not decreasing. The disabled don’t seem to be getting better, while the number of newly disabled continues to grow. It is not a good trend.
In the latest Job Openings Report issued yesterday, Wall Street once again was overly optimistic. The Street expected the JOLTS report to show 10.5 million openings. There were 300,000 more openings than the estimate. An indication that the Job Openings may be increasing and are becoming a problem that may be with us for some time.
Unfortunately, this is a reality far too few of us are willing to face. Many would instead argue over cause than look at the statistics. I’m less concerned, at the moment, whether this reflects “long Covid,” “Vax injury,” or some other injury or cause. First, we must recognize that the American Labor Force is in trouble. We lose workers every month for reasons we may not fully understand.
But to solve any problem, we must first recognize that it exists. And every month, those 10 million job openings are shouting loud and clear: American workers are at risk.
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