Word of the day

10/11/2021

Clatterfart – a prolific gossip or blabbermouth; someone who will disclose a secret.


Sowell says

10/11/2021


Stats don’t tell full story

10/11/2021

The statistics on unemployment last week were good news but they don’t tell the full story:

There is a lot of falseness about the economy. 

The jobless rate was excellent. But it looks better because we are merely soaking up the people who wanted jobs based on the fact the choice has vanished. The labour market has shrunk, the population is no longer growing, we are paddling in a smaller pool, and the pool we are paddling in is filled with $50 billion worth of printed money.  . .

Lindsay Mitchell shows a fuller story:

Graphs are great tools for getting the big picture. Here I have plotted the unemployment rate against ‘unemployment’ benefits:

The heavy blue line is a combination of unemployment and sickness benefits. In 2013 the two benefits were combined into the single Jobseeker benefit (heavy brown line) but still with two categories – JS Work Ready and JS Health Condition and Disability.

The broken line is the official unemployment rate BUT expressed as a percentage of 18-64 year-olds, not 15+. Thats why in Sept 2021 it’s 4.4% – a point higher than the rate announced yesterday of 3.4%

The vertical lines mark the changes of government. . . 

The number of people unemployed is going down, but the number of people on benefits is increasing.

3/ Covid is largely responsible for the late steep upward trajectory of the heavy brown line BUT is was trending up before March 2020. My last post explained why the line has crossed the unemployment rate line and there is now a large gap between the two.

4/ The covid upturn is very similar to the GFC onset in magnitude. Lockdowns (policy within control of government) caused as much job loss as the global financial crisis (outside of government control).

5/ Another observation some would make is the gap between the unemployment rate and unemployment benefit lines during National’s term is now being corrected by Labour. Labour is more generous with benefits. The gap right now is a reversal of the period 2011-17.

There’s another line.

It’s the very fine line between being generous with benefits and entrenching dependency and all the misery that entails.

The post to which Lindsay refers gives some more statistics:

. . . Back to the Maori stats highlighted in the chart, in Northland, a region with a high Maori population the unemployment rate is 3.9% yet the Jobseeker rate is 10.5 percent.

In the general population the figures are:

Unemployment rate     3.4% 

Jobseeker rate     6.1%

 All benefit-dependent rate   11.3% . . .

The trouble is that life on a benefit isn’t necessarily miserable for everyone.

Friends in a small business employed someone for 20 hours a week. They offered her more work but she turned it down.

She has six children and is getting around $1,000 on a benefit and said she didn’t want or need to work longer hours.


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