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FOR SUBSCRIBERS | August 8, 2023 |
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(Chip Somodevilla/Getty Images) |
This Is Not a Healthy Job Market |
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By Jeffrey Tucker |
Commentary Going into the weekend, we were again bombarded by crude propaganda from the Biden administration. The topic was the jobs report, which claimed another half-million jobs had been created. Plus, they cite the unemployment rate, which is 3.5 percent, shockingly low but it means absolutely nothing. It only counts the number of people in the job market who can find a job but excludes everyone else. That statistic is so useless at this point, it might as well not be collected at all. Labor force participation is still substantially lower now than it was before lockdowns, and fully 6.7 percent below a high reached in 2000. There is much broken in this market but nothing more so than the shell game going on right now in tallying full-time vs. part-time and multiple job holders. Here is where the decay is truly evident, and it is a problem that profoundly affects people’s lives. I dutifully dug through the latest report when it was first released in the morning, suspecting that something was wrong with the spin. But reading through the text put out by the Bureau of Labor Statistics, nothing jumped out at me. I gave it a rest until the afternoon. A few economists on Twitter spotted a problem, so I had another look. Sure enough, buried deep in the data, we find something incredibly interesting and downright frightening. It turns out that between June and July, the United States lost half a million full-time jobs. That’s the largest loss in this category since the lockdowns. Where does this net job creation claim come from? Get this: the same data set reveals that there have been one million new part-time jobs created, for a net of half a million. Multiple job holders soared. Do you see what’s happening here? It’s no different than cutting a hamburger in half and claiming you just made 100 percent more food. People are losing full-time work and replacing such jobs with part-time jobs, with people taking two or three to attempt to match the income. In other words, this is a genuine calamity unfolding before our very eyes. And yet, absolutely no one in any official position dares mention it. |
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The trends are not headed in the right direction, if by that a vibrant job market with high-wage full-time employment. Instead, those jobs are gradually fading and being replaced by gigs and paycheck foraging. The Bureau of Labor Statistics completely obfuscated this alarming trend in their discussion. Even the data bureaus are now thoroughly politicized to the point that you can’t believe what they say. |
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(Data: Federal Reserve Economic Data [FRED], St. Louis Fed; Chart: Jeffrey A. Tucker) |
As for the wages that people 16 and older are actually earning, they are now at the same rate they were before the lockdowns. The stimulus payment proved to be a short-term fix, a boost of nothing that was quickly taken away by inflation. Now matter what the White House says now—it’s basically all lies—wages have been in a prolonged state of stagnation ever since the great disaster of March 2020. Very likely, we have not really left that forced recession. There will be no soft landing because there is nothing to land. Most of the growth is fake and wages are stuck in real terms. |
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(Data: Federal Reserve Economic Data [FRED], St. Louis Fed; Chart: Jeffrey A. Tucker) |
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Whatever happened to progress? What happened to the idea of gradually living better than our parents? That vision is gone in America, especially among young people, replaced by a dour culture of just getting by. Let’s leave aside the data for now and dig into what life is like for today’s young college graduates. Much depends on training and experience but one case in my mind really sticks out because this young man did everything right from secondary through college and graduate school. He chose an Ivy education that was very expensive and focused on American and European literature, receiving very high marks throughout college, exactly as high-soaring SATs would have predicted. At 24 with a master’s degree, he is super well-educated and erudite, not to mention mannerly, mature, and earnest. But now he confronts the one thing that his education never prepared him for: getting a job out of college. It’s incredibly cruel how this works. Once the university has cashed your final check and handed you a degree or two, they completely wash their hands of you. He has discovered within a few weeks that the job boards like Indeed are completely useless. He sent off 100 well-formed applications with customized resumes. He heard back from 8 of them. Of those he received three interviews, only one of which called him for an in-person interview. That went well, he thought, but never heard back from them, not even so much as a polite no. They ghosted him completely. So here he is with high credentials, the best possible education, flawless manners and speech, and is unable to get a job that fits with his years of training. In the old world, a person like this would work for a high-end publisher or perhaps an encyclopedia publisher or a cultural publication. Those jobs are in high demand now because there are ever fewer of them. Every institution out there is also hiring from within existing networks of which he is not part. It doesn’t help that nothing about him checks any of the boxes to enable him to become tokenized in the name of diversity compliance. That’s because he is a white male, which these days serves as a mark against him, as he was daily reminded in college. What’s the next step? There are plenty of jobs out there in the service industry. But taking such a job would mean having to recognize that the years of training in literature, language, and writing were a waste of time from a professional point of view. No one wants to do that. And journalism seems like a good path but the major media is entirely captured by ideological interests. There are not enough positions available in alternative media to support all those willing to go in that direction. I’m struck by the difference in the world he confronts versus what I faced when I left college with an economics degree. Truly, it never even occurred to me what I would do when I left. I chose a journalism path and ended up in a variety of positions in the nonprofit and for-profit world. But my main point is that there was never a lack of opportunity for me or anyone in my generation. We had it so good that we didn’t have a care in the world about getting a job. Times have dramatically changed. The labor market is undergoing huge shifts, away from the high-paying Zoom jobs that dominated the market for 15 years. We live with vast surpluses in those sectors, with every major business culling its ranks of the fanciest jobs that people once snagged solely due to credentials and connections. At the same time, there are vast shortages for workers who actually do real stuff in the real world. The adjustment is not going to be without tremendous pain. A major reason concerns the heavy regulation in the labor market itself. Unions are not as much a pressing problem. The key issue is regulation and compliance. Every business that wants to hire faces incredible costs at every step along with legal risks of litigation. Small business is the future of hiring but such enterprises are throttled with a thicket of rules, mandates, and a culture of fear. As a result, the entire sector is likely to be bogged down for years to come. It’s all an unnecessary tragedy but don’t expect the Bureau of Labor Statistics to report any of it. They are too busy burying the bad news in piles of numbers hardly anyone bothers to discover. Federal Data Shows 2 Million+ Foreign Grads in U.S. White-Collar Jobs President Joe Biden’s deputies are hiding a huge and growing population of at least 2 million foreign white-collar contract workers in the U.S. jobs needed by U.S. graduates and their families. “Americans should be outraged that the federal government is not disclosing the number of long-term, so-called ‘temporary’ workers who are here,” Jessica Vaughn, policy director at the Center for Immigration Studies, told Breitbart News. She continued:
The laws, regulations, and loopholes effectively allow U.S. companies to import are many foreign white-collar workers as they want, for as long as they want. This reality means that CEOs can easily import more foreign workers to prevent any rise in U.S. salaries. For example, the U.S. economy is shedding white-collar jobs, but lobbyists and journalists are pushing “labor shortage” claims for new jobs in government-funded chip factories in the Midwest. So far, Republican senators have blocked industry efforts to expand the flow of foreign workers into those factories. The State Department’s incomplete data reviewed by Breitbart News shows a population of at least 1.5 million foreign workers in U.S. white-collar jobs. That huge population is the output from almost two years of American business, healthcare, and STEM graduates, and it allows major U.S. investors to hold down salaries and minimize the ability of U.S. graduates to enforce professional standards for quality and security. “We have seen how it dilutes the clout of American workers because employers will either replace Americans who are doing certain kinds of work… and they can threaten to do so,” Vaughan said, adding:
The huge inflow also skews the geography of wealth, she said. The foreign workers “are not evenly scattered across the economy,” Vaughan said. “They’re concentrated in certain sectors that have figured out how to manipulate the visa system — technology, physical therapy, accounting … [and] university science,” she said. The inflow has also helped suppress the salaries of U.S. college graduates since the 1970s. For example, the inflation-adjusted hourly salary earned by U.S. graduates of four-year colleges has inched up from $32.21 in 1990 to $41.60 in 2022, according to the Economic Policy Institute. That’s an annual growth of just 0.9 percent, even as the cost of housing, education, and healthcare have climbed far faster. Bloomberg.com reported in January:
Starting salaries for U.S. computer experts are also falling, the National Association of Colleges and Employers reported in February: “The average starting salary for bachelor’s degree graduates studying computer science is expected to fall by 4.0% compared to a year ago.” Most visa workers will work for lower salaries than American graduates. That is rational because any job in the United States is often better than a decent job in their home country. Moreover, CEOs know they can dangle the government subsidy of green cards and citizenship — easily worth $1 million — to extract the long hours of labor that they cannot extract from American graduates. The hidden army of foreign white-collar workers mostly threatens new American graduates. The Wall Street Journal reported in March:
 National Center for Education Statistics The salaries lost by U.S. graduates have been mostly diverted to profits and stock values. For example, a group of economists estimated in 2021 that President Donald Trump’s short-lived 2020 curbs on corporate use of additional H-1B contract workers nicked the stock market value of Fortune 500 companies “by about 0.45% — representing a total loss of around $100 billion.” Roughly 30 million Americans hold jobs in the healthcare, computer, engineering, science, or financial sectors. Many of these American professionals are swing voters, yet few politicians talk about the visa worker programs that take their wealth, careers, and jobs. Presidnet Joe Biden’s “approval among college grads slipped to 48%-42% in July from 52%-40% in June and 55%-37% in May,” Investors.com reported in July. Numbers The scale of the white-collar workforce inflow in 2022 is revealed by a State Department document. The document shows the number of 2022 work visas awarded to many categories of foreign graduates. Breitbart News added the annual inflow of uncapped E-2, H-1B, H4, J-1, L-1, O-1, and TN visas, to show roughly 543,000 arrivals in 2022. Most white-collar arrivals are allowed to stay and work for several years. For example, H-1B graduates can stay for three years, so the total number of working H-1Bs in the United States should be about 550.000. The E-2 managers can stay for five years, so the 2022 inflow of 50,000 arrivals suggests a resident population of 225,000. The L-1 visas can stay up to years, prompting a 2021 population of an estimated of almost 340,000 workers. Overall, the 543,000 arrivals in 2022 suggest a resident population of 1.5 million white-collar workers, not counting the workers’ spouses and children, and not counting the many workers who have converted their temporary visas into green cards. But many temporary workers can stay forever once their employers file a request for a green card. This wait-and-work population of visa workers has reached 700,000, according to a 2022 report by the pro-migration Cato Institute. The State Department, however, does not manage the Optional Practical Training or the Curricular Practical Training work programs. In 2022, those two programs provided work permits to an additional workforce of roughly 350,000 foreign graduates, including many working in Fortune 500 jobs. Many additional students take jobs within universities, such as in university laboratories. The data also excludes the inflow of TN workers from Canada. This loophole allows Canadians — including recent immigrants — to get approval at the U.S. border to take a wide variety of jobs via a little-recognized section of the NAFTA treaty. The department’s data also excludes the number of migrants who take white-collar jobs after overstaying their visas. Those numbers are difficult to track because the federal data does not hide white-collar overstays from blue-collar overstays. But the 2022 overstay report shows that officials allowed 50,000 foreign graduates and short-term workers in 2022 — such as H-1Bs workers — to overstay their visas. The State Department also does not track the number of people who take white-collar jobs after arriving with B-1/B-2 visitor visas. However, Breitbart News has learned from U.S. professionals and from Indian visa workers that many Indian graduates enter as tourists to get jobs in the layers of subcontractors working for Fortune 500 companies. Top officials at the Department of Homeland Security largely ignore this large population of white-collar illegals, even when their employers are exposed. City Journal reported in May 2023:
President Joe Biden’s border chief, Alejandro Mayorkas, has tried to grow the population of foreign white-collar contract workers. For example, he expanded the J-1 program to let companies — not just universities — employ J-1 visa workers. He has also twice expanded the OPT program to let companies hire foreign child psychologists, landscapers, accountants, and many other categories of white-collar workers. He accelerated the award of work permits to the spouses of L-1 white-collar workers and E-2 managers. Many of the beneficiaries then take white-collar jobs alongside their spouses but are not included in the state department’s account. Mayorkas also discarded the 2020 reforms of the H-1B program that would have opened up more starter jobs to American graduates. The vast majority of the imported white-collar visa workers are lower-skilled migrants who are slotted into the career-starter jobs needed by young U.S. graduates. In many cases, foreign workers use the Internet to hire very cheap home-country experts who can do their daily workload in the United States — even when they are working with private data. Without starter jobs, many American graduates are sidelined into lower-pay, low-promotion jobs while foreign workers are promoted via kickbacks and ethnic hiring networks. For example, a 2021 study by the Census Bureau reported:
Some of the OPT and J-1 white-collar workers do not take jobs, or get sidetracked into menial jobs, such as in a dog-food factory. The total inflow of blue-collar visa workers is also huge — and even more difficult to track. They arrive via the H-2B seasonal program for about 120,000 workers, the uncapped H-2A program for agriculture workers, and the J-1 program for seasonal workers. Many white-collar E-2 foreign managers also import blue-collar workers via various illegal routes. These home-country illegal workers allow the E-2 managers to profitably operate their franchise hotels, 7-Eleven stores, and other retail outlets — while also paying high franchise fees to the investor-owned companies that own the brand names. Worse, the State Department data shows about 1.2 million active “border crossing cards.” They allow people who live in Mexico to work in U.S. jobs within 75 miles of the border. In 2020 Reuters reported:
“We have no idea how those cards are being used because [the government] doesn’t track them,” said Vaughan. Extraction Migration The federal government has long operated an unpopular economic policy of Extraction Migration. This colonialism-like policy extracts vast amounts of human resources from needy countries, reduces beneficial trade, and uses the imported workers, renters, and consumers to grow Wall Street and the economy. The migrant inflow has successfully forced down Americans’ wages and also boosted rents and housing prices. The inflow has also pushed many native-born Americans out of careers in a wide variety of business sectors and contributed to the rising death rate of poor Americans. The lethal policy also sucks jobs and wealth from heartland states by subsidizing coastal investors with a flood of low-wage workers, high-occupancy renters, and government-aided consumers. The population inflow also reduces the political clout of native-born Americans, because the population replacement allows elites and the establishment to divorce themselves from the needs and interests of ordinary Americans. In many speeches, border chief Alejandro Mayorkas says he is building a mass migration system to deliver workers to wealthy employers and investors and “equity” to poor foreigners. The nation’s border laws are subordinate to elite opinion about “the values of our country” Mayorkas claims. Migration — and especially, labor migration — is unpopular among swing voters. A 54 percent majority of Americans say Biden is allowing a southern border invasion, according to an August 2022 poll commissioned by the left-of-center National Public Radio (NPR). The 54 percent “invasion” majority included 76 percent of Republicans, 46 percent of independents, and even 40 percent of Democrats. |
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