Hiring

17 Reasons Why Those Hoping For A Recession In 2012 Just Got Their Wish

If you were hoping for a recession in 2012, then you are going to be very happy with the numbers you are about to see.  The U.S. economy is heading downhill just in time for the 2012 election.  Retail sales have fallen for three months in a row for the first time since 2008, manufacturing activity is dropping like a rock, sales of new homes are declining again, consumer confidence has moved significantly lower and a depressingly small percentage of businesses anticipate hiring more workers in the coming months.  Even though the Federal Reserve has been wildly pumping money into the financial system and even though the federal government has been injecting gigantic piles of borrowed cash into the economy, we still haven’t seen an economic recovery.  In fact, we appear to be on the verge of yet another major downturn.  In California the other night, Barack Obama told supporters that “we tried our plan — and it worked“, but only those that are still drinking the Obama kool-aid would believe something so preposterous.  The truth is that the U.S. economy has been steadily declining for many years and now we have reached another very painful recession.

And don’t let the second quarter GDP number on Friday fool you.  Analysts are expecting to see GDP growth of about 1.4 percent for the second quarter, but the only reason for our very small amount of “economic growth” is because the economy has been flooded with new dollars.

Let me give you an example.  If I could go out overnight and magically double the bank accounts of every single American, would we all be twice as wealthy?

No, because there would be twice as many dollars now chasing the same amount of goods and services.  The price of those goods and services would soon rise dramatically to reflect this new reality.

With all of those new dollars spinning around in the economy it would look like “economic growth” was going through the roof, but in reality the amount of real economic activity would be about the same.

So whenever we talk about GDP, we need to properly adjust it for inflation.  That means using accurate inflation figures and not the highly manipulated inflation figures that the U.S. government is putting out these days.

And as I noted the other day, after properly adjusting for inflation the U.S. economy has been continually experiencing negative economic growth since about 2005.

So let’s not deceive ourselves.  The U.S. economy has been declining for a long time.

But soon even the GDP number that the government gives us will turn negative.  We will probably see a slightly positive number for the second quarter, and the number will likely go negative either in the third quarter or the fourth quarter.

Economists will debate when this new recession officially “began” just like they do with every recession, but it doesn’t take a genius to figure out what is happening to our economy right now.

The following are 17 reasons why those hoping for a recession in 2012 just got their wish….

1. U.S. retail sales have declined for three months in a row.  This is the first time this has happened since 2008.  Every other time this has happened in U.S. history (except for once) this has signaled that the U.S. economy was either already in a recession or was about to enter one.

2. The Philadelphia Fed index of manufacturing activity contracted for the third month in a row during July.  According to the Financial Post, this is a very bad sign….

Seven out of eight times when the average reading has been that low (-11.8) for that long the U.S. economy has tipped into recession.

3. Manufacturing activity in the mid-Atlantic region has also declined for three months in a row.  In fact, the only time in the past decade when manufacturing activity in the mid-Atlantic has fallen more dramatically was during the last recession.

4. A factory index calculated by the Institute for Supply Management has fallen to its lowest level since June 2009.

5. The Conference Board index of leading economic indicators has fallen for two of the past three months.

6. According to a recent survey conducted by the Conference Board, only 17 percent of CEOs had a positive view of the economy during the second quarter of 2012.  During the first quarter of 2012, 67 percent did.

7. Gallup’s U.S. Economic Confidence Index is now the lowest that it has been since January.

8. Optimism among small business owners has declined in three of the last four months and is now at its lowest level since last October.

9. Believe it or not, the amount of waste being carted around on trains in the United States has an 82 percent correlation with U.S. economic growth.  Unfortunately, right now the number of garbage carloads on trains is falling dramatically.

10. Sales of previously occupied homes dropped by 5.4 percent during June.

11. Sales of new homes declined by 8.4 percent during June.  At this point new home sales are less than a third of what they were during the boom years.

12. An increasing number of Americans are relying on high interest “payday loans” to pay the rent and put food on the table.

13. Far more companies are defaulting on their debts this year than last year.

14. According to the U.S. Labor Department, the unemployment rate fell in 11 states and Washington, D.C. last month, but it rose in 27 states.

15. The unemployment rate in New York City is now back up to 10 percent.  That equals the peak unemployment rate in New York City during the last recession.

16. The teen unemployment rate in Washington D.C. right now is 51.7 percent.

17. A recent survey conducted by the National Association for Business Economics found that only 23 percent of all U.S. companies plan to hire more workers over the next 6 months.  When the same question was asked a few months ago that number was at 39 percent.

All of those are very powerful pieces of evidence that a new recession has started.

But do you want to know one of my favorite indicators that the U.S. economy is sliding into recession?

In a previous article, I noted that Federal Reserve Chairman Ben Bernanke made the following statement to Congress recently: “At this point we don’t see a double dip recession. We see continued moderate growth.”

As I mentioned the other day, Bernanke has a track record of failure that is absolutely embarrassing.  Back on January 10, 2008 Bernanke made the following statement….

“The Federal Reserve is not currently forecasting a recession.”

That turned out to be a great call, didn’t it?

On June 10, 2008 he doubled down on his call that the U.S. economy was going to avoid a recession….

“The risk that the economy has entered a substantial downturn appears to have diminished over the past month or so.”

Just before Fannie Mae and Freddie Mac collapsed Bernanke made this statement….

“The GSEs are adequately capitalized. They are in no danger of failing.”

And there are dozens of other examples just like these.

This is the guy running our economic system.

I am very critical of the Federal Reserve, but there are very good reasons for this.

The Federal Reserve is running our economy into the ground, and we need to pound this into the heads of the American people so that they will wake up and demand change.

Perhaps this next recession will be painful enough to wake people up.

The Wall Street Journal is already even using the “D word” to describe what we are experiencing.  Just today, the Wall Street Journal ran an article that asked this question: “Do Two Recessions Equal One Depression?”

Sadly, this is just the leading edge of what is coming.  By the time 2014 or 2015 rolls around, we are going to look back and long for the “good old days” of 2011 and 2012.

Over the next few years, the unemployment rate is going to skyrocket and poverty in the United States is going to get a whole lot worse.

Now is not the time to goof off.  Now is the time to work really hard to get yourself and your family into the best position that you can for the storm that is coming.

Nothing is going to stop the terrible economic crisis that is coming, but at least we can get prepared for it.

There is hope in being prepared.

Sadly, most people will never even see the next crisis coming until they get blindsided by it.

Go West, Young Man (To North Dakota)

Are you unemployed and out of options?  Well, if you live in most areas of the country there is not much hope for you.  But there is one state where hiring is really hot right now.  If you are desperate for a job, you just might want to check out North Dakota.  Way back in the middle of the 19th centurty, author Horace Greeley gave young Americans the following advice: “Go West, young man, go West“.  Well, we have reached another moment in U.S. history when it may be wise for many Americans to pick up and move to another part of the country in search of opportunity.  Of course traveling to North Dakota is not “going west” for all Americans, but for the majority of the population it is.  In the 19th century, many Americans traveled west because they believed those that told them that there was “gold in them thar hills”, but today a different kind of “gold” is being found in North Dakota.  The state is currently enjoying a boom of “black gold”, and all of that oil is creating a huge number of jobs.  If you are unemployed and you are desperate, you might want to check out North Dakota.  Desperate times call for desperate measures.

As I write about so frequently, unemployment is an absolute nightmare in most areas of the country right now.  But in North Dakota there are plenty of jobs and they pay really well.  Just check out what a new CNN article is saying about what is going on in the state….

Believe it or not, a place exists where companies are hiring like crazy, and you can make $15 an hour serving tacos, $25 an hour waiting tables and $80,000 a year driving trucks.

You just have to move to North Dakota. Specifically, to one of the tiny towns surrounding the oil-rich Bakken formation, estimated to hold anywhere between 4 billion and 24 billion barrels of oil.

CNBC also recently ran an article about the jobs boom up in North Dakota.  According to CNBC, there are “help wanted” signs all over the place in little towns such as Williston….

Unemployment is a national problem in the U.S., but you wouldn’t know that if you travel through North Dakota.

The state’s unemployment rate hovers around 3 percent, and “Help Wanted” signs litter the landscape of cities such as Williston in the same way “For Sale” signs populate the streets of Las Vegas.

“It’s a zoo,” said Terry Ayers, who drove into town from Spokane, Wash., slept in his truck, and found a job within hours of arrival, tripling his salary. “It’s crazy what’s going on out here.”

If you are desperate for work and you are looking for a “reboot”, North Dakota may be an option for you.  According to CNN, there are a significant number of families that have already changed their lives by heading out to North Dakota….

McMullen now works as a nanny in exchange for housing. Her husband, who worked on behavior management programs for a school system in North Carolina where he took home about $1,600 a month, found a job working in the oilfields where he makes that same amount of money in one week — adding up to an annual salary of about $77,000.

“We want to be debt-free, so we came here to play catch-up,” said McMullen. “But when I came here, I thought I was on Mars. It’s just so crazy that the rest of the country has no jobs, and here’s this one place that doesn’t have enough people to fill all the jobs.”

So is North Dakota for everyone?

Of course not.

First of all, it gets bone-chilling cold in North Dakota in the winter.

If you cannot handle really cold weather then you should not go up there.

Secondly, there is not nearly enough housing in the boom towns and the housing that is available is really expensive.

So you may either have to commute a long way or deal with accommodations that are less than stellar.

North Dakota is very flat, the geography is not very pleasant, there is not much to do there, the “boom towns” are very far from major population centers and moving there would entail major sacrifices for most people.

But there are good jobs up there.

So if you are looking for some good news, you just got some.

Look, it is better to try to do something than to sit around waiting for Barack Obama to save you.  As I have written about previously, the Obama jobs plan is a bad joke and even if it got through Congress it would do very little to create jobs.

The truth is that Barack Obama simply does not know what he is doing when it comes to jobs.  He continues to push for even more job-killing “free trade” agreements that will result in millions more American jobs being shipped overseas.

Barack Obama continues to run around the country talking about “infrastructure jobs”, but according to ABC News, thousands upon thousands of those jobs are actually going to Chinese workers….

In New York there is a $400 million renovation project on the Alexander Hamilton Bridge.

In California, there is a $7.2 billion project to rebuild the Bay Bridge connecting San Francisco and Oakland.

In Alaska, there is a proposal for a $190 million bridge project.

These projects sound like steps in the right direction, but much of the work is going to Chinese government-owned firms.

The sad truth is that the U.S. economy continues to slide even further down the tubes and the vast majority of our politicians have no idea how to fix things.

When Barack Obama first took office, the official U.S. unemployment rate was 7.6 percent.  Today it is 9.1 percent.

There are less jobs in the United States today than there were a decade ago, and the number of good paying jobs continues to shrink.

In 1980, 52 percent of all jobs in the United States were middle income jobs.  Today, only 42 percent of all jobs are middle income jobs.

So don’t sit around waiting for the economy to fix itself.  There is no reason to have blind faith in the system at this point.

We live during unconventional times, and many of us are going to have to find unconventional solutions to our problems.

There are lots of good jobs in the western part of North Dakota.

If you need a job, you might want to look into it.

Just When You Thought It Was Safe To Start Sending Out Resumes Again….

Perhaps you had heard that the unemployment rate in the United States has been going down and you were planning to start sending out resumes again.  Well, unfortunately it is not “morning in America” again.  Some really depressing jobs numbers were just released.  The number of Americans applying for unemployment benefits skyrocketed last week to the highest level that we have seen in 8 months.  Also, according to a new poll more American workers say that their companies are getting rid of workers than say that their companies are hiring more workers.  So feel free to start mailing out thousands of resumes once again – just don’t expect better results.  Tens of millions of unemployed and underemployed Americans have been waiting for the “economic recovery”, but the sad truth is that this is the economic recovery.  This is about the best that things are going to get before the next major wave of the economic collapse strikes.

Most economists were extremely surprised by how bad the new numbers were.  The following is an excerpt from the press release from the Department of Labor….

In the week ending April 30, the advance figure for seasonally adjusted initial claims was 474,000, an increase of 43,000 from the previous week’s revised figure of 431,000. The 4-week moving average was 431,250, an increase of 22,250 from the previous week’s revised average of 409,000.

As noted above, that was the highest number of initial unemployment claims that we have seen in eight months.

In addition, ADP has announced that only 179,000 private sector jobs were added to the economy during the month of April.

That number also was an unpleasant surprise to most economists.

But shouldn’t the economy be recovering by now?

Yes, it should be.

Unfortunately, there is even more bad news.

According to the latest Rasmussen Employment Index, 19 percent of U.S. workers say that their companies are hiring more workers right now and 25 percent of U.S. workers say that their companies are laying off workers right now.

That is not a good sign.

But even when jobs are available most of the time they are crappy jobs.

A growing percentage of jobs in America do not even pay a living wage.  Low income jobs now make up 41% of all the jobs in the United States.

In a recent article on outsourcing, I noted that the U.S. economy is bleeding lots of good jobs and that they are being replaced by bad jobs….

Right now America is rapidly losing high paying jobs and they are being replaced by low paying jobs.  According to a recent report from the National Employment Law Project, higher wage industries accounted for 40 percent of the job losses over the past 12 months but only 14 percent of the job growth.  Lower wage industries accounted for just 23 percent of the job losses over the past 12 months and a whopping 49 percent of the job growth.

So do you want to mop floors at the local Burger King or stock shelves over at Best Buy?

A million Americans recently showed up to apply for a job at McDonald’s.  If that is not a sign that the American people are losing faith in the economy then I don’t know what is.

So are you ready to go down and apply for a job at McDonald’s?

Well, if not you may find yourself waiting for a very, very long time for a “good job”.

According to the U.S. Bureau of Labor Statistics, the average duration of unemployment in the United States is now an all-time record 39 weeks.

Today, we have millions upon millions of Americans that are sitting home because they can’t find work.

Only 66.8% of American men had a job last year.  That was the lowest level that has ever been recorded in all of U.S. history.

That is not good for the economy.  Instead of being productive and producing wealth for the economy, all of those unemployed men are a drain on the system.

Today, 18 million more Americans are receiving food stamps than when the economic downturn first began back in 2007.

Considering the gigantic amounts of spending that the U.S. government has been doing since the beginning of the economic downturn and considering the massive amounts of new money that the Federal Reserve has been injecting into the financial system, the unemployment rate should be much, much lower than it is now.

Our leaders have gone “all in” on stimulating the economy in the short-term and yet it is still responding like a dead horse.

Now there are even some in the financial media that are saying that we are going to need “QE3” in order to get the economy going.

Perhaps we will even need “QE4”, “QE5” and “QE6”.

This is getting ridiculous.

Essentially the U.S. economy is like a patient that the doctors are hovering around and desperately trying to revive.

So are they going to be successful?

I wouldn’t bet on it.

Sadly, what we are experiencing right now is the economic recovery.

When the next wave of the economic collapse hits, things are going to get even worse.

How To Find A Job: Just Be Willing To Flip Burgers And Work For Minimum Wage

Do you want to know how to find a job in America today?  It’s easy.  Just be willing to flip burgers, wait tables or welcome people to Wal-Mart.  You must also be willing to work for close to minimum wage with no health benefits.  It’s not that complicated.  On April 19th, McDonald’s is going to be holding its first “national hiring day” and it will be attempting to fill 50,000 positions.  Hundreds of thousands of applicants are expected, so if you are going to apply be ready for some stiff competition.  McDonald’s held a similar event last year in its western region and 60,000 people applied for just 13,000 jobs.  But if you are one of the lucky ones, you too may soon be flipping burgers for minimum wage.  Who said that finding a job was hard and that the U.S. economy doesn’t work anymore?  All of us just need to be “flexible” and we all need to be willing to adapt to the “new economic reality”.

Oh, you say that you can’t pay the mortgage and feed your family on what they would pay you at McDonald’s?

You say that you are looking for a “good job”?

Well, that is just too bad.

Good jobs are becoming increasingly scarce.  In fact, there are 10% fewer “middle class jobs” in the United States today than there were a decade ago.

The competition for the few “middle class jobs” that are still available has become so intense that you might not want to steer clear.  You just can’t afford to be too picky in today’s world.

After all, you don’t want to become one of those poor saps that is unemployed month after month after month.  According to the U.S. Bureau of Labor Statistics, the average length of unemployment in the U.S. is now an all-time record 39 weeks.

Can you really afford to be out of work for almost a year?

Why not go after the “low hanging fruit”?  For a position at McDonald’s or Wal-Mart you will probably only be competing against four or five other people for each job opening.  Those odds aren’t that bad.

Things were not always like this in America, you say?

Once upon a time there were actually lots and lots of great jobs?

Well, this is part of the sacrifice that we must make for the emerging global economy.  We must allow thousands of our factories to close and millions of our good paying jobs to be shipped overseas.  Our politicians have all promised us that globalism will be incredibly good for us in the long run.

So don’t be alarmed when naysayers warn that the United States has lost an average of 50,000 manufacturing jobs per month since China joined the World Trade Organization in 2001.

Yes, American workers now must directly compete for jobs with millions of people willing to work for slave labor wages on the other side of the globe.  But eventually their wages will come up slightly and our wages will go way down to their level and at that point we will all have equality.

You aren’t against “equality” are you?

Who could be against equality?

This is what globalism is all about – tearing down all the borders and gathering us all into one big, happy “global family”.  Right now too many of the good jobs are in America so millions of them have to be shipped out of the country.  Also, millions of legal and illegal immigrants must be allowed into the U.S. so that they can compete for American jobs as well.

But won’t that drive wages down?

Of course, but in the end the “global community” will benefit.

What did you think?  Did you actually believe that the United States would be able to have a thriving middle class forever?

In the new “global economy“, the wealthy get to exploit slave labor on the other side of the world thus wiping out the American middle class.

Already we are seeing signs of an “economic recovery” with the ultra-rich leading the way.  According to Moody’s Analytics, the wealthiest 5% of households in the United States now account for approximately 37% of all consumer spending.

That is some “change” that Wall Street can believe in!

But what about the rest of us?

All kidding aside, it is absolutely brutal out there right now.

American families just want jobs that will enable them to pay their mortgages, put food on the table and provide a decent standard of living for their families.

Unfortunately, those jobs are disappearing and they are being replaced by low paying service jobs.

According to a recent report from the National Employment Law Project, higher wage industries accounted for 40 percent of the job losses over the past 12 months but only 14 percent of the job growth.  Lower wage industries accounted for just 23 percent of the job losses over the past 12 months and a whopping 49 percent of the job growth.

So yes, it has become extremely difficult to find a job that pays a decent wage.

In fact, half of all American workers now earn $505 or less per week.

Could your family survive on $505 a week?

One reader recently left a comment that detailed how this economy has left her without a job, without a home and feeling depressed….

Yup, Im depressed. If I would have known what the WTO protests were about here in Seattle in the 90s, I would have joined in. I knew a lot of folks were very angry, but I wasn’t sure why. I was a busy working mother of a toddler. Now fast forward 10+ years and I haven’t worked in 2 and a half years and only 4 job interviews in that time and 0 job offers. we are going to get paid by Chase to give them our home (gee thanks!) so we can move out… OK now what? things aren’t looking too good. I started a very small business that no where near comes even close to supporting us. So were going to stay in my brother’s house in Texas. and then? who knows. at least I don’t feel alone. there are millions of stories just like mine.

Sadly, there are millions more stories just like this.  The U.S. economy has fundamentally changed and it simply does not work like it used to.

Millions of American families are experiencing severe economic pain right now, and millions more will be experiencing it very soon.

In a previous article entitled, “Where Are The Jobs?“, I explained why things are changing for American workers….

Most Americans don’t really care about the economic minutiae that many of us who study the U.S. economy love to pour over.  When it comes to the economy, the typical American citizen just wants to be able to get a good job, make a decent living and put bread on the table for the family.  For generations, this arrangement has worked out quite well.  The U.S. economy has provided large numbers of middle class jobs and the American people have worked hard and have helped this nation prosper like no other.  But now people are starting to notice that something has shifted.  Millions of people are looking around and are realizing that the jobs that are supposed to be there are not there anymore.  The American people are still working hard (and in many cases harder than ever) but all of that hard work is producing fewer and fewer rewards.  Often politicians will placate voters by telling them that they are working harder and harder for less and less.  That tends to ring true with voters because that is a very accurate description of what so many of them are actually experiencing, but what the politicians don’t tell us is that they are the ones to blame for the situation that we are in.  As millions of jobs become obsolete because of technology and millions of other jobs are shipped overseas, our politicians tell us over and over that we can “compete” with anyone and that if we will just go out and get some more education we can make it happen.  But those of us who are extremely over-educated know what a fraud that line is.  The truth is that there are not nearly enough jobs for all of us no matter how “educated” we are.  This is creating a lot of anger and frustration, and now even the IMF is warning that we could see “an explosion of social unrest” if high unemployment persists.

Unfortunately, most of our politicians do not have any answers.  Bill Clinton greatly accelerated the shipping of our jobs overseas.  George W. Bush was a complete and total disaster when it came to the economy.  Barack Obama has been continuing most of the economic policies of those that came before him.

Unless we make some fundamental changes, millions of jobs will continue to be lost, the U.S. industrial base will continue to be dismantled, we will continue to go into astounding amounts of debt as a nation and more American families will slip into poverty every single day.

But waiting for Washington D.C. to change is kind of like waiting for hell to freeze over.  The Federal Reserve is not going to help us either.  In fact, the Fed is at the very heart of our economic problems.

No, the truth is that the U.S. economy is going to continue to go downhill.  All of us need to try to become less dependent on the system, because when it collapses it is going to devastate the lives of tens of millions of American families.