Wednesday, July 23, 2014


From page A4 | November 20, 2013 |

‘Twas brillig, and the slithy toves
Did gyre and gimble in the wabe;
All mimsy were the borogoves,
And the mome raths outgrabe.

If the above opening lines from Lewis Carroll’s “Jabberwocky” make sense to you, then maybe you can make sense of Obamacare.

We can, however, make some sense of Obamacare’s effect on the economy. We look to Bob Funk, whose Oklahoma-based temp service is the fifth largest employment agency in the country.

In an interview Sept. 21 with the Wall Street Journal’s Stephen Moore, Moore summarized part of his interview with Funk thusly:

“The temporary employment business is booming now because in the fragile economy and, with Obamacare on the way, companies are skittish about bringing on permanent hires. Some businesses, to remain below the 50-employee level, hire all their additional workers beyond No. 49 through Express (Employment Services). He says other CEOs are so fed up with the new rules that they have asked Express to take over the management of their entire workforce.”

“If Bob Funk’s warnings about employment and the jobs market are accurate, then almost everything Washington is doing to address the problem is either beside the point or counterproductive. And the Obamacare-driven march toward the 30-hour workweek continues,” wrote Moore in conclusion.

“Our franchises across the country are seeing a definite demand for more part-time workers,” Funk said.

However, an Aug. 26 newsletter from the San Francisco Federal Reserve written by Rob Valletta and Leila Bengali, analyzed historical Bureau of Labor Statistics and concluded the following:

“The slack work subcomponent is highly cyclical, with increases and declines typically tied closely to recession dates (BLS 2008). Movements in the inability to find full-time work subcomponent tend to lag behind the slack work component. In 2012 and 2013 through July, this component continued to rise slightly as the slack work subcomponent fell. This is unsurprising given that the U.S. labor market has recovered only about three-fourths of the jobs lost during the recession and its aftermath, which leaves finding a full-time job still challenging for many workers. However, the ratio of this subcomponent to the hours cutback subcomponent remains low in historical terms, suggesting that general labor market slack remains the key factor keeping part-time employment high.”

The slack in the labor market remains. August was the 40th consecutive month in which more workers left the labor market than found jobs. Where do they go? In June the Social Security Administration reported 10.9 million on Social Security Disability Insurance. September’s figures, reported in October, were 14.2 million.

Funk said one of the key things to getting Americans back to work is shrinking the “vast social welfare state programs that have become a substitute for work. There’s a prevalent attitude of a lot of this generation of workers that the government will always be there to take care of them. It’s hard to get people to take entry-level jobs when they can get unemployment benefits, health care, food stamps and the rest.”

The number of food stamps recipients was 19 million in 2002, 28 million in 2008, 46.6 million in 2012, 47.66 million as of this August.

The Bureau of Labor Statistics reported the following for October’s 7.3 unemployement rate: “The civilian labor force was down by 720,000 in October. The labor force participation rate fell by 0.4 percentage point to 62.8 percent over the month.”

Also: “The number of persons employed part time for economic reasons (sometimes referred to as involuntary part-time workers) was little changed at 8.1 million in October. These individuals were working part time because their hours had been cut back or because they were unable to find a full-time job.”

Beware the Job-erwocky.

And, “Beware the Jubjub bird, and shun
The frumious Bandersnatch!”



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