Friday, September 30, 2011

Friday, September 23, 2011

Thursday, September 22, 2011

Eurozone PMI

Here's the key graph from the Markit PMI press release.  This is from their survey of Purchase Managers in September so provides a more real time indicator than official indicators.  That's certainly not an encouraging reading at all.

European Industrial Production

Tuesday, September 20, 2011

Monday, September 19, 2011

Thursday, September 15, 2011

Wednesday, September 14, 2011

Tuesday, September 13, 2011

Friday, September 9, 2011

Technology Reversal Job Creation Measures

I was thinking about the President's job creation measures this morning.  The composition and scale of the proposals sounds broadly similar to the ARRA stimulus bill of a couple of years back and it seems like the effect might be similar - mitigate the worst of the downturn while being insufficient to create much actual job growth.  However, clearly the bill runs the risk of being perceived to make the deficit worse (and very likely actually would make the deficit worse).

I also take to heart some of the critique in Do Stimulus Dollars Hire the Unemployed? that in a highly technological automated society it's not completely straightforward for stimulus dollars to flow to the people that need it (ie lower skilled and out of work individuals).

Another thing the government could do in principle to create jobs fairly quickly is ban certain labor saving technologies, thus forcing businesses to hire people to do the work instead. This has several advantages: it wouldn't cost the government anything and the results would be more controllable in terms of where the jobs went.

For example, suppose the government declared that over the next 12 months all automated phone answering systems would be banned at businesses with more than, say, a dozen employees.  No more voicemail, no more automated voice recognition systems when you call your bank or utility. Since businesses have to answer the phone, this would force them to hire people to do it instead - lots of people.  Since receptionist jobs historically went to young less-skilled individuals, we could assume that the same thing would happen now.  Since employment is particularly bad amongst the young and the unskilled, this measure would be very targeted to the demographics that need it most.

It might be objected that this would make businesses less efficient and that is undoubtedly true on an individual corporate basis.  However, in an economy where lack of aggregate demand is an issue, it's far less obvious that the overall economy would produce less as a result.

It might also be objected that this would make US corporations suffer at the hands of less constrained foreign competitors.  That is clearly also an issue in the long term.  However, perhaps we could justify such measures in the short term as emergency job responses.  And in the long term, everyone is going to have the same kinds of problems of technological unemployment so evident in the US, and perhaps there will be scope for international agreements around this kind of thing.

Thursday, September 8, 2011

Monday, September 5, 2011