The industry with the lowest unemployment rate is...

Posted by: Michael Mandel on April 03

…ah, come on, you know, the answer. It’s a good time to be part of the government.

According to today’s job market report, the unemployment rate for government workers is 2.8%. The next lowest is 4.5% for private education and health services. Oddly enough, the unemployment rate for financial activities is only 6.8%.

TrackBack URL for this entry: http://blogs.businessweek.com/mt/mt-tb.cgi/

Reader Comments

Kartik

April 3, 2009 07:39 PM

Government jobs have become unusually high-paying with perks far better than private sector workers get.

Yet another piece of evidence how as prosperity rises, the ratio of moochers to producers becomes too high for the economy to grow.

I don't think any country with more than 10m people can achieve per-capita GDP above $60,000 (in 2009 dollars). Too many people become leftists who suck resources away from productive people.

This may be an inherent limitation of human society.

Viking

April 3, 2009 08:27 PM

I agree with Kartik.Then again,as the private sector continues to become more productive,we need to put the excess people somewhere,if we are to keep unemployment at a reasonable level,so we apparently are choosing to stash a bunch of them in government "jobs".We could on the other hand lower the hours worked in the standard workweek,as a reward for higher productivity,instead of private sector workers paying higher taxes,in order to support a bloaded public sector,but what do I know!!

Joe Cushing

April 3, 2009 09:19 PM

I would assume the numbers for financial activities includes accountants. These are the last people to go before a company closes the door. Even a dying company has to have accountants.

That's an interesting hypothesis Kartik. If you take the numbers out of it, I certainly agree. It's hard to agree on any certain number though.

Viking

April 3, 2009 09:31 PM

A further thought on this.I live in California,where we just got hit by higher taxes on vehicles,sales and income and why?To allow a disproportionate number of government employees to stay on the job during the recession,costing me more in taxes,necessitating me working longer hours to keep the same after tax income.It would be the same as a private company raising it's prices,in order to keep more people on the payroll,during the recession.We know that is not possible,because the private company faces competition,but the government can,as long as we the taxpayers keep letting them stick it to us!Instead if the standard workweek could be gradually reduced as productivity increased,our taxes could stay the same,as we could keep government payrolls the same,as we would not develop a glut of workers,because of ever increasing productivity in the private sector.

Kartik

April 4, 2009 02:18 AM

Viking,

Stashing people is one thing. But paying them far more than such a person can get in the private sector is another.

Longshoremen in California earn $150,000 a year.

That bogus Director of Health Services in Ohio who tried to smear Joe the Plumber earns $142,000 a year, in Toledo, Ohio (where living costs are low).

Public-sector pensions are guaranteed to a much greater degree than anyone's 401K.

That is why productive people are leaving California, which once had a private sector that was the envy of the world.

Kartik

April 4, 2009 02:24 AM

Joe Cushing,

The US has per-capita GDP of $45,000, but in real terms, this has not risen in almost a decade.

The ceiling may not be exactly $60,000, but I think it is very much in doubt that any good-sized country (say, >10M people) can cross $60,000 in real dollars, due to the 'moocher tax'. Let's see how long it takes for America or any other developed country to cross $60,000 (as measured in 2009 dollars).

That would still be a 33% increase over what America is now, but I think it is far from guaranteed that we can cross this barrier.

Just look at California. Once the crucible of the biggest ambitions on Earth, it is collapsing under the weight of its public sector.

CompEng

April 4, 2009 09:13 AM

I can't believe the garbage I'm reading. There are plenty of barriers for a large population having a high per-capita GDP that have nothing to do with the human desire to "mooch".

California's large Hispanic underclass is poorly integrated and poorly paid, but most members of the class work hard in jobs many better educated Americans simply won't do. This population of immigrants costs heavily in public schooling, health care, and other basic social services. But this is Mike's "Malthusian pressure", not the invasion of moochers. They'd like to work for the privilege to live like you, but they don't know how to go about it. But if you think that's expensive, the consequences of a poorly integrated population that you don't invest enough in are paid purely in crime and social unrest. And that's the really nasty side of what you're seeing: second and third generations not leaving but having completely lost their faith in the system and its rules.

Yes, surely it sucks to be richer than your neighbors.

Mike Mandel

April 4, 2009 09:46 AM

A couple of points. These statistics are defined by industries, not by occupation. So the 'financial activities' unemployment rate reflects people who were in finance, insurance, real estate, regardless of occupation.

The point about a limit of real GDP per capita, I think, is an interesting one, but reflects the limitations of measurement rather than a real ceiling on well being. Real GDP reflects production, for the most part, in the market sector. Suppose that as a country gets richer, more people decide to take their higher income as leisure rather than more goods. Or suppose they collectively decide to take their higher income as better government services (say, better parks). Then real GDP would rise slower--but actual well being would rise further.

However--however--the big rise in debt suggests that we have not really been getting richer, but we've been behaving as we were.


Tom E.

April 4, 2009 10:06 AM

Hello Mike. Don't post this message as it does not fit in with the topic. I could not find your email.

If you get time, perhaps you could write more about the idea that wages have declined this decade because health care costs have increased. I read somewhere that business has traditionally paid out 40% for employee wages and health care and that health care costs have taken up the money that would normally go towards pay increases.

Larry Summers has commented about this as well as David Frum (Bushs speech writer).

I am curious as to whether it was free trade or health care costs that have driven down wages or both.

Certainly the idea that your job can be outsourced or shipped overseas is a level to push down wages. On the other hand, I can see health care costs reducing the slice of the pie for wages.

Thanks.

Mike Mandel

April 4, 2009 10:50 AM

Hi Tom,

The comments are automatically posting at this point, which I think is better.

But you ask a very good question. My first take is that healthcare is a very labor intensive industry. So most of the health care spending is flowing out the door again as wages for home health aides, nurses, and doctors.

So I think the real question is the lack of growth in the rest of the economy--both globalization and technology.

I'll come back to this in more detail soon.

Brandon W

April 7, 2009 09:58 AM

Someone around here has been smokin' a little too much Ayn Rand.

Ryan

April 11, 2009 06:48 PM

every one is worried about jobs but fails to understand that for true wealth in America you must own your own business. People should look at http:wwww.securemyownearnings.com to learn how to make it to the top 1% income earners

Thank you for your interest. This blog is no longer active.

 

About

Michael Mandel, BW's award-winning chief economist, provides his unique perspective on the hot economic issues of the day. From globalization to the future of work to the ups and downs of the financial markets, Mandel-named 2006 economic journalist of the year by the World Leadership Forum-offers cutting edge analysis and commentary.

BW Mall - Sponsored Links

Buy a link now!