BLS Report Reflects Lower Average Wages: An Explanation

Guest Post by Joe Guzzardi

As the classic Johnny Mercer/ Harold Arlen tune goes, let’s “Ac-Cent-Tchu-Ate the Positive.” The White House adopted the advice of the popular 1944 song, along with “eliminate the negative,” and applied it to the October Bureau of Labor Statistics report. But, as is routinely the case, a sub rosa review of the BLS data is, official White House happy talk aside, more disconcerting given that in September the economy created a mere 136,000 jobs, well below the Wall Street prediction of 145,000.

Nevertheless, proceeding in full 2020 campaign mode, the White House boasted about, among its other successes, September’s 50-year low 3.5 percent household unemployment rate that included significant declines in the numbers of discouraged and underemployed workers, as well as record low unemployment for Hispanics and African-Americans.

Conspicuously missing from the press release was the discouraging news that on a year-over-year comparison, earnings grew only 2.9 percent, significantly below August’s 3.2 percent – the weakest wage growth since July 2018. Making workers’ bottom line income worse is that their average weekly hours logged stayed the same at 34.4 – same hours, lower pay.

Still, in most demographic segments employment status has improved, and presumably individuals’ lives are better. BLS data showed that the unemployment rate for people without a high school diploma fell to 4.8 percent, the lowest rate since 1992 when such statistics were first compiled and dramatically lower than the 7.8 percent posted in November 2016. The U-6 unemployment rate that measures those marginally attached to the labor force also plunged, and currently stands at 6.9 percent, its lowest since 2000.

More employment, especially for minorities and for the under-educated and less skilled, is unarguably a positive. Even though wages could be higher, having a job also translates into financial independence, increased self-worth and, hopefully, eventual professional growth.

Since most Americans are doing better, a reasonable question is why President Trump continues the practice of annually admitting more than 1 million, lifetime work-authorized legal immigrants. The new lawful permanent residents will compete for employment one-on-one with citizens, and with the approximately 4 million Americans who turn 18 each year. The most adversely affected could be those recently on the rebound from long unemployment, but who now have jobs in retail, hospitality or health care.

President Trump’s critics call him anti-immigrant. But since his 2016 inauguration, the Trump administration has admitted more than 3 million permanently work-authorized immigrants, and nearly as many guest workers who also vie for employment with citizens. More than two years have passed since President Trump’s February 2017 address to Congress wherein he called for reforming, i.e., reducing, legal immigration to protect American workers.

Returning to last month’s dip in wage growth, immigration is a key ingredient that partially explains why incomes declined after several monthly increases. Tight labor markets are an essential component of rising wages. Month-to-month variations like September’s can be expected. But over the long haul, markets must be tight, and therefore immigration low, to sustain consistently higher wages, and to protect American workers from job displacement. This is ironclad Economics 101 that too many establishment media reporters ignore even though it has been established fact for a century.

As American Federation of Labor president Samuel Gompers wrote in his 1921 letter, “Those who favor unrestricted immigration care nothing for the people. They are simply desirous of flooding the country with unskilled as well as skilled labor of other lands for the purpose of breaking down American standards.”

No intellectual argument can be made in defense of allowing more years of an annual influx of more than 1 million immigrants. President Trump should return to his American worker advocacy by again taking up the case for lower immigration levels.

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12 Comments
Elizabeth Warren is a LIAR
Elizabeth Warren is a LIAR
October 8, 2019 6:53 am

Trump never mentions the millions on visa from India. The high paying jobs are all nearly 100% going to Indians…the lower blue collars getting screwed by Mexican border hoppers. The only thing left to do is vote, then march, the revolt. Each step ushers in a new level of importance so the politicos understand the American people are seriously pissed.

the experienced
the experienced
  Elizabeth Warren is a LIAR
October 8, 2019 7:12 am

The engineering jobs are taken by young engineers from India, because young American engineers hardly exist. I am an immigrant engineer myself and have met many of my Indian counterparts. Without them there wouldn’t be much engineering in America anymore.

Vote Harder
Vote Harder
  the experienced
October 8, 2019 7:19 am

You sand niggers are hired solely because it saves the employer money on cheaper engineers, not better qualified engineers. You are as full of shit as a blocked toilet.

Anonymous
Anonymous
  the experienced
October 8, 2019 10:20 pm

To “The Experienced” we have great young Americans in all the professional engineering fields and many others . Your tag line that they do not exist is to say the least is incorrect . Actually it’s a corporate bull shit line to farm out as much high end work as possible to foreign labor . The money elites did it with every industry in America to the detriment of the entire nation .
Where they could not export labor and industry they merely imported labor driving every economic factor in every area of the country down . The flood of illegals allowed to be in our nation unfettered and free to work is a pathetic example of what our government has become thanks to those that own it

Vote Harder
Vote Harder
  Elizabeth Warren is a LIAR
October 8, 2019 7:16 am

The only thing left to do is vote

Looks like you didn’t vote hard enough.

the experienced
the experienced
October 8, 2019 7:05 am

The problem is not immigration in general. It is WHO is allowed to come in.
I took an online class (electrical power engineering) with K-State in 2009. The new text book we used started with the statement, that the US is experiencing a big shortage of electrical engineers. At the same time the interest of college students in electrical engineering has declined so much that many universities have shut down their engineering faculties.
Thus immigration would have the chance to selectively permit an immigration that would help correct the issue. Sadly so, liberal politics do not allow to follow sound reasoning.
I have a German masters in electrical engineering and a bachelors in business economics. But because no company hiring those skills wanted to put up with a several years long immigration process, I had to find a different way and ended up teaming up with a custom harvester, utilizing my farming background and mechanical aptitude.

Vote Harder
Vote Harder
  the experienced
October 8, 2019 7:22 am

liberal politics do not allow to follow sound reasoning.

Liberal and conservatives both want the same thing when it comes to immigration. You’re falling for the lie of identity politics.

TN Patriot
TN Patriot
  the experienced
October 8, 2019 10:33 am

I started studying to be an EE in 1970 and was shocked that fully 1/3 of the College of Engineering was composed of foreign born students. I suspect that number is much higher after the ensuing 50 years. Our public school indoctrination centers have not put an emphasis on math and science for the past 30 – 40 years and are more into teaching social justice type courses than STEM. I am beginning to see a change, but it is very slow.

CFPUP
CFPUP
  the experienced
October 8, 2019 4:07 pm

EE has essentially been outsourced to H-1B workers. This probably more true in the area of engineering than in tech. This all started in the 199os when the asset stripping of Europe and America began. TPB decided there was more profit to be made in Asia so that is were our manufacturing base went. As Ross Perot said during the ’92 campaign, the engineering always follows the manufacturing. When I was a kid, Lehigh University in PA had a stellar engineering school and its graduates found ready employment with Bethlehem Steel. That is not the case anyomore because Beth Steel is gone as is much of our manufacturing. Now with employment visa programs like H-1B, OPT, L-1 and others, TPB are asset stripping what is between the ears of most productive workers. They contract with firms to outsource functions like IT and tell the American workers if they want their severance packages they have to train their replacements who are all H-1B visa holders working for these contracting companies. It really sucks.

flash
flash
October 8, 2019 7:19 am

At least we still have muh free market. Capitalism is real.

https://www.zerohedge.com/health/food-freedom-how-washingtons-food-subsidies-have-helped-make-americans-fat-and-sick

“All told, the U.S. government spends $20 billion annually on farm subsidies, with approximately 39 percent of all farms receiving some sort of subsidy. For comparison, the oil industry gets about $4.6 billion annually and annual housing subsidies total another $15 billion. A significant portion of this $20 billion goes not to your local family farm, but to Big Aggie.

(Note that this $20 billion annual farm subsidy figure doesn’t take into account the 30+ years of ethanol subsidies to the corn industry nor export subsidies to U.S. farmers issued by the USDA.)”

The database tracks $391 billion in farm subsidies from commodity, crop insurance, disaster programs and conservation payments paid between 1995 and 2019‡

https://farm.ewg.org/

the experienced
the experienced
  flash
October 8, 2019 9:22 am

Yep, the big processing companies get a lot. The farmers are driven into dependence.
When the farmers have a good year, they get raped by legalized theft, aka income tax, so that they have no chance to save for a bad year. Thus they have to rely on subsidies to survive the bad year. Only a few farmers have managed to stay away from uncle Sam’s plantation and make it without subsidies.

TC
TC
October 8, 2019 9:48 am

Trump repeatedly brags about the black, latino and even female unemployment rate, even recently saying that black slaves built America. White males, his biggest voting block, can go pound sand.
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