Category: employment

The Overs Win

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The US economy U.S. added 850,000 jobs in June, well over the consensus estimate of  706,000.

One fly in the ointment though, long term unemployment numbers continued to rise:

The U.S. labor market recovery is accelerating after a spring lull.

Employers added 850,000 jobs in June—the biggest gain in 10 months—and workers’ wages rose briskly, the government said Friday, both signs of robust demand for workers.

The unemployment rate, derived from a separate survey of households, rose to 5.9% last month from 5.8% in May. That was in part because of a positive development: A modest number of Americans came off the sidelines and entered the job search, expanding the labor pool. A broader measure of unemployment that takes into account workers stuck in part-time jobs and those too discouraged to look for work fell sharply last month.

Job growth lagged behind broader economic growth earlier this spring, with the economy adding 583,000 jobs in May and 269,000 in April. But big hurdles to hiring are starting to clear away. Rising vaccination rates, easing government restrictions on businesses and the expiration of unemployment benefits in many states are stoking the latest growth.

That last phrase is a bit of editorializing by the writer.  There is still no evidence that extended unemployment benefits are keeping people off of the job markets, but it’s dogma at places like the WSJ.

We are still not over the hump.

Bye, Felecia

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Meghan McCain has quit as a host of The View on short notice.

She was probably pushed: 

Meghan McCain, the lone conservative voice on ABC’s daily talk show “The View,” told viewers Thursday that she was leaving her co-host chair at the end of the season this month.

McCain said at the start of the New York-based program that she wants to stay in Washington, D.C., where she worked during the COVID-19 pandemic.

“I have this really wonderful life here that I ultimately feel like I didn’t want to leave,” McCain said.

McCain, who is married to conservative writer Ben Domenech, gave birth to a daughter, Liberty,[ed comment, WTF?] last fall. The couple have split their time between New York and Washington.

………

The Daily Mail, which first reported that McCain would exit, said the host had two years left on her contract with ABC.

(emphasis mine)

She announced it on very short notice. 

Pushed, with good reason.

Today in Amazon Rat-F%$#ery

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A brief rundown of poor Amazon behavior, first despite triple digit temperatures in the Pacific Northwest, and the Kent, Washington warehouse continued operations in brutal heat with no air conditioning. 

Next, and more significantly, Amazon is demanding stock warrants to carry some merchants’ products in their store, which in addition to being something that Glass-Steagall USED to ban is a pretty big slam dunk example of anti-competitive behavior:

Suppliers that want to land Amazon.com Inc. as a client for their goods and services can find that its business comes with a catch: the right for Amazon to buy big stakes in their companies at potentially steep discounts to market value.

The technology-and-retail giant has struck at least a dozen deals with publicly traded companies in which it gets rights, called warrants, to buy the vendors’ stock in the future at what could be below-market prices, according to corporate filings and interviews with people involved with the deals.

Amazon over the past decade also has done more than 75 such deals with privately held companies, according to a person familiar with the matter. In all, the tech titan’s stakes and potential stakes amount to billions of dollars across companies that provide everything from call-center services to natural gas, and in some cases position Amazon among the top shareholders in those businesses.

The unusual arrangements offer another window into how Amazon uses its market heft to increase its wealth and clout. The company has been under growing scrutiny from regulators and lawmakers over its competitive practices, including with companies it partners with.

………

Amazon routinely leverages its size and power to force terms that benefit itself, including by getting partners in one business to sign on to its other services; learning about up-and-coming technology companies through its venture-capital fund; or creating top selling Amazon branded goods that compete with small sellers on its site. It has aggressively competed to wrest market share from rivals, which Amazon says results in better deals for shoppers.

In its supplier deals that include warrants, Amazon throws its weight around to exact lucrative terms, knowing many companies won’t refuse, according to former Amazon executives who worked on the deals.

An Amazon spokeswoman said the warrants it obtains in commercial agreements are typically tied to milestones that Amazon has to meet, such as large purchases from the supplier. The company declined to comment on specific deals, or say how many warrants it has exercised or the amount of money it has made from such agreements. The spokeswoman said it has warrant deals in fewer than 1% of the commercial agreements it enters into.

Grocery distributor SpartanNash Co. last year amended a contract with Amazon to deliver groceries to its Amazon Fresh arm. The Grand Rapids, Mich.-based company had been supplying Amazon with food since 2016, but this time Amazon added a condition: if it bought $8 billion worth of groceries over seven years, it could get warrants to purchase around 15% of SpartanNash’s stock at a price potentially lower than the market. Amazon also said it wanted to be notified of any takeover offers for SpartanNash and have a 10-day window to offer a counterbid.

………

Amazon has been doing such deals with vendors for about a decade but has aggressively increased the practice in the past few years, said former Amazon executives and lawyers who worked on structuring the deals. In its latest quarterly report, the company valued its warrants at $2.8 billion, more than five times the level three years ago. Amazon doesn’t disclose the value of stakes it owns as a result of exercising its warrants.

A broader measure of its warrants and the stakes it holds in companies through warrants, direct investment or other ways increased 10 times to $8.4 billion in that period, according to Amazon’s quarterly filings.

………

Like stock options, warrants let the holder buy a company’s shares at a set price during a set period. If the stock surpasses that strike price, the warrant holder can buy shares at a below-market price.

Corporate executives in a range of industries and lawyers said Amazon’s push to get warrants as part of vendor deals is highly unusual. Warrant deals have more commonly been used by investors who back companies in financial trouble, in deals deemed high risk.

Amazon is using its market dominance to steal from the share-holders, but that’s OK with the corrupt stooges that Robert Bork unleashed on antitrust law.

………

In talks with Atlas Air Worldwide Holdings Inc., Amazon broached a 10-year leasing deal, with similar terms. This time Amazon demanded warrants that would amount to up to 20% of Atlas’s equity over five years—with an option for 10% more later—depending on how much business it gave Atlas. Amazon also wanted the right to elect a director to Atlas’s board, after meeting certain milestones.

People involved on both sides said that warrants were a condition of Amazon partnering with Atlas. “There was definitely a sense that if it wasn’t agreed to there wouldn’t be a deal,” said one of the people. Atlas executives didn’t want to pass up the revenue opportunity from Amazon and viewed giving up the warrants as the price of doing business with Amazon, said the person.

………

Former Amazon executives said they avoided doing anything during supplier negotiations, such as putting its ultimatums in writing, that would give fodder to critics who have said Amazon abuses its power. One of the former executives said that most companies complied with its demands over warrants. Several former Amazon executives who worked on such deals said in interviews that they found them to be unfair and one-sided, saying the companies weren’t in a position to refuse and that most of the upside went to Amazon.

This is extortion and demanding kick-backs, and while it is likely legal, it really shouldn’t be.

This sort of behavior is baked into its DNA, as we can see by their dealing with the press as well, with intimidation and lies being the rule rather than the exception:

It was a slow news day at Gizmodo, the tech website where Dell Cameron worked. Without a story of his own to report he decided to aggregate—a journalism term for rewriting and crediting—a day-old Tampa ABC-affiliate’s TV piece on how Amazon’s Ring home surveillance security system was being marketed to dozens of Florida police departments.

A day later, an email from an Amazon spokesperson popped into Cameron’s inbox. The brief email claimed that the Tampa-based reporter, Adam Walser, was “correcting his story” and suggested that Cameron would need to do so as well. In her mail, the spokesperson challenged the accuracy of the station’s entire report. “It is inaccurate that AWS or Amazon is marketing Amazon Rekognition to law enforcement, either individually or in combination with Ring,” she wrote.

Cameron checked, and he didn’t see a correction on the Tampa story. Before making any change to his post, Cameron decided to reach out to Walser and double-check. “I read him the exact email that they sent me,” Cameron says. Walser was puzzled, according to Cameron. “He said ‘That’s just not true, we’re not issuing a correction. I don’t know what they’re talking about.’” Cameron wrote back to the Amazon spokesperson relaying what he’d been told, and mentioning that Gizmodo was planning their own potential follow-up story that was “likely to include that Amazon attempted to obtain a correction from Gizmodo by falsely claiming the ABC station was planning to issue one.”

The Amazon spokesperson doubled down, insisting that a correction had indeed happened. She accused Cameron of being “up in arms” and “threatening” by mentioning the possibility that Gizmodo would publish a piece about being misled by Amazon. “I do not appreciate being called… a liar,” she added in a follow-up email.

………

“I do not believe for a second that this person is naive or didn’t understand what a correction is,” Cameron told me recently, almost two years after the interaction. “They got a job in the PR department at one of the most powerful companies in the world. I think they were trying to trick me into correcting a story and didn’t expect me to go back and contact the reporter.”

It’s not unusual for communications teams for corporations, non-profits, and the government all alike to be withholding in their interactions with the press and to try to spin things in the best possible light. It’s rarer that companies try to mislead and intimidate the press into falling into the lines that they want. But of the dozen journalists I spoke with for this story, most of whom declined to be identified out of concern for professional repercussions, all recalled times Amazon’s press team had engaged in manipulative and sometimes deceitful behavior. According to these writers and editors, and my own experience reporting on the company, Amazon’s comms team readily employs these rarer, bare-knuckle PR tactics. The ultimate result isn’t just that reporters have a harder time writing stories. Some may be deterred from writing on the company at all. And if those that do are deceived and unduly influenced, then by extension the public is as well.

Aside from Cameron, at least two reporters recalled moments when they felt Amazon’s press team had outright lied to them. Almost all of the journalists told me they found that Amazon press relations was either the most or among the most clawing and deceptive corporate communications team that they had dealt with in their work.

“Amazon is the only company I’ve dealt with that has directly lied to me,” said one tech writer, recalling instances when Amazon boasted of warehouse safety guidelines in ways that journalists who had spoken with rank-and-file employees had found not to be true.

“They’d often lie about things we had proof of,” said another reporter, citing times they had visual evidence contradicting the communications teams’ claims. “There will be videos of these big walkouts and they’ll say only a few workers participated.”

………

“I do think that the broader effort is to disincentivize you from telling the truth. They want you to feel like it’s going to be a world of pain if you do your job,” one veteran tech reporter said. “Even if corrections aren’t needed, it’s still a headache and a waste of time for reporters and editors and lets them know that they’re probably scheduling another headache for themselves the next time that they decide to write about Amazon.”

Another reporter at a smaller outlet with less resources described a similar chilling effect after the company pressured him after a critical story. “It just eats up so much of time, going back and forth with our attorneys,” the reporter said, describing how the trouble had made him hesitant to cover Amazon again. “You think twice about it. Is it really worth it? Maybe you have a good story but it won’t change how they do business. It’s kind of a scary thing.”

Amazon tried a similar tactic this September on Reveal—a non-profit investigative news shop that often releases its stories in partnership with newspapers, broadcasters, and other outlets—after it published an award winning series from a team led by reporter Will Evans about the company’s efforts to mislead the public about warehouse injury rates. “Yesterday we published an investigation into Amazon’s massive misinformation campaign. Naturally, we’re now the *subject* of their misinformation campaign,” wrote Andy Donohue, Reveal’s deputy director of projects.

………

But others noted Amazon is willing to go to bold lengths compared to other companies they’ve reported on. Amazon has a broader reputation for fostering a cutthroat corporate culture, which seems to be reflected in the company’s external communications. Ahead of April’s high profile unionization vote at the company’s Bessemer, Alabama facility, Amazon fallaciously tweeted claims that its hard-pressed drivers and warehouse pickers didn’t actually have to pee in bottles, and chided lawmakers like Bernie Sanders and Elizabeth Warren who had spoken out about the company’s labor conditions. Recode reported that the tweets were directly driven by Jeff Bezos, the company’s CEO and one of the world’s most wealthy men.

While that suggests the company’s aggressive PR efforts flow from the very top, there are other executives with a role in overseeing public relations and related portfolios. While the most high profile may be vice president of global corporate affairs Jay Carney, the former Time magazine reporter and Obama White House press secretary, two former Amazon communications staffers and another employee with knowledge of Amazon’s communications team told me that Drew Herdener, the vice president of communications, usually calls shots internally.

………

Amazon’s tactics seem to be well known among reporters. Beyond the dozen with personal experience I spoke with for this story, many others who had not themselves faced an Amazon harangue were aware of the company’s aggressive approach. Indeed, hints of Amazon’s press strategies have leaked out over the years. In 2019, a Twitter glitch notified users when they were put on other users’ private lists. Caroline Haskins, a reporter at BuzzFeed who had broken a series of stories on Amazon Ring, noticed that Morgan Culbertson, an Amazon PR person, had added her to a list called “Haters.”

The goal is to have these tactics, “Well known among reporters.”  The technical term for this is, “Chilling Effect.”

Even reporters who have never written a story about Amazon are leery of writing one.

………

It was not the first time I had been yelled at by a press flack—that’s not uncommon. Nor was it the first time I had been asked for a correction. But it was the first and only time a press flack tried to aggressively antagonize and intimidate me into stripping a quote out of a published story from an established expert.

That expert, Stacy Mitchell—the co-director of the Institute for Local Self-Reliance, a research group that advocates for small businesses—has seen the impacts of Amazon’s PR wrath firsthand. When I spoke with her for this story, Mitchell said that she’s had editors “tone-down and remove stuff to reduce the blowback from Amazon” or “at least brace themselves,” when preparing to publish op-eds she’s written.

See Effect, Chilling.

………

“I’ve heard about Amazon’s bullying from many journalists,” Mitchell says. “I sometimes ask reporters about it, and sometimes they bring it up off-handedly.”

………

Even accepting that less than ideal reality, Amazon seems to be doing something that goes beyond mere spin. Facebook, Google, or other tech giants’ softer pressure and prodding certainly don’t come with the best of intentions. But employing aggressive, intimidation tactics and playing word games that severely contort the truth clearly goes beyond the line, wherever it is.

I am not surprised.  The company was founded by a contemptible sociopath, and the company (Corporations are people, my friend) is a contemptible sociopath as well.

It’s Jobless Thursday

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Initial unemployment claims fellell to a post pandemic low of 364,000, which is actually down to the level of a bad week in the before time:

Worker filings for jobless benefits fell to a new pandemic low last week and resumed a monthslong downward trend, adding to signs of a recovering labor market.

Initial jobless claims fell by 51,000 to a seasonally adjusted 364,000 in the week ended June 26 from the prior week’s revised total of 415,000, the Labor Department said Thursday.

The drop brought the four-week moving average, which smooths out volatility in the weekly figures, to 392,750, also a pandemic low. Jobless claims, a proxy for layoffs, are down by about 50% since the first week of April, but remain above pre-pandemic levels.

“We are seeing labor-market progress,” said AnnElizabeth Konkel, an economist at job-search site Indeed. She added that “we still have just a little bit more ways to go” before unemployment claims reach pre-pandemic levels.

Initial claims were at 256,000 on March 14, 2020, as Covid-19 took hold in the U.S. The 2019 average for claims was 218,000.

Thursday’s decline in unemployment claims came ahead of the June U.S. employment report, set to be released by the Labor Department on Friday. Economists project that employers created 706,000 jobs last month and that the unemployment rate fell to 5.6%.

As always, I will go with the under.

Never Walking the Walk

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One of the reasons that liberals and progressives are given no respect is because when the rubber hits the road, and they need to abide by their own morality, they refuse to do so.

Case in point, the Paulo Freire Social Justice Charter School in Massachusetts, where administrators are going scorched earth over a unionization effort by teachers.

In case you don’t recognize the name, “Paulo Freire,” he was a Marxist educator, who wrote extensively on how the current model of education did not meet the needs of the poor and downtrodden.

Not exactly the sort of philosophy that is compatible with going Walmart on your staff:

In 1968, Paulo Freire, a famous Brazilian philosopher, authored the book Pedagogy of the Oppressed, a Marxist argument for using education to empower the downtrodden. In 2013, a charter school named in his honor was founded: the Paulo Freire Social Justice Charter School (PFSJCS), located in Chicopee, Massachusetts. Now, in a display of the universe’s sense of humor, teachers at PFSJCS say that the school’s leadership is engaging in union busting.

In March 2020, the school’s professional staff of about 26 people — mostly teachers, along with a few other employees such as guidance counselors — unionized with UAW Local 2322 in Massachusetts. Zack Novak, one of the teachers who helped lead the union drive, said that several years of experience working in unionized public schools had led him to expect certain standards of treatment that he didn’t see at PFSJCS. ​“At charter schools in general, the climate is much different. I noticed people being treated unfairly by the administration,” Novak said. ​“The only way to get ahead was if the powers that be liked you. That’s not an equitable environment for teaching staff.”

Novak sent out an email notifying everyone at the school that the staff had unionized in March of last year. The same day, he says, he was pulled into a meeting with administrators, which he interpreted as an assertion of their power. At the end of the school year, he said, he was offered a new contract to come back — but that contract was rescinded before the next school year began, for no apparent reason. He believes that his involvement in organizing the union was the motivating factor.

In July 2020, the school hired Gil Traverso as its new executive director, to replace a retiring predecessor. Since then, union members say, labor relations have been awful. According to Carol Huben, a PFSJCS teacher, the first ominous sign was ​“a really strong pattern of not responding to union communications.” Next, she said, teachers were warned or disciplined after posting innocuous pro-union messages in their Zoom backgrounds at bargaining meetings.

Then, Huben said, came the most serious blow to the union: a dozen teachers whose contracts were up last year were ordered to reapply for their own jobs — and none of them were rehired. The union said in a press release that ​“no explanation was offered for their non renewal of contracts.” Huben also said that management is warning newly hired teachers to beware of the union. The union has filed complaints over more than 20 incidents since Traverso’s hiring, teachers said.

Primates in general, and humans in particular, are hard wired for fairness, and when they see, “Liberalism for thee and not for me,” it disinclines them from considering the idea of people working for the collective good.

It’s the hypocrisy, stupid.

I’ll Take Deeply Racist Company Culture for $500, Alex

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I’m referring, of course, to the Chocolate Factory, AKA Google, who has shuttered a diversity training program because the graduates were systematically underpaid, and too many of the quit.

This is racism presented as performative anti-racism:

Google has scrapped a scheme designed to train and hire engineers from diverse backgrounds – after people who made it through the program to become Googlers complained they were screwed over in pay.

The engineering residency program, known as Eng Res, has run since 2014. It’s aimed at those who don’t quite qualify as entry-level engineers; these folks are then trained up in various departments in the Chocolate Factory, and after a year they’re either hired as a proper developer or dropped.

The idea is to identify and top up the skills of people who show potential but have not had the same opportunities as others to learn and grow, or have faced unfair career-limiting hurdles, prior to applying for a role at Google. Newbie coders get a place at one of the world’s biggest names in tech, and Google gets a workers from a diverse range of backgrounds.

But after completing the program, alumni are given lower salaries, smaller bonus payments, and no stock units compared to their peers, a group of over 500 current and former Googlers have claimed.

Over time, this pay gap creates “systemic pay inequities,” according to presentation given to the web giant’s top brass by Eng Res graduates, Reuters reports.

Now, Google has dropped Eng Res altogether. A spokesperson told The Register a new program will be put in place.

It appears that the salary/bonus/stock option deficit was on the order of tens of thousands of dollars, and followed them throughout their careers.

I gotta figure that this blatant racism is central to Google corporate culture.  They think that “Those People” should be grateful for having a place at Google, and that this justifies underpaying them.

Guck Foogle.

Initial Jobless Claims Went Up

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Initial Unemployment Claims rose by 37,000 to 412,000, though the 4-week moving average continued its downward trajectory:

Worker filings for initial unemployment benefits rose last week for the first time since late April but remained near a pandemic low as the labor market continues to heal from the impact of Covid-19.

Initial jobless claims rose by 37,000 to 412,000 in the week ended June 12. Despite the increase, the four-week moving average, which smooths out week-to-week volatility, reached a new pandemic low of 395,000. This was the lowest average level since March 2020, when the pandemic first took hold in the U.S. 

………

Thursday’s claims report also showed unemployment rolls shrank late last month. The number of ongoing benefit claims—a proxy for those receiving payments—fell by more than 500,000 to 14.8 million the week ended May 29. That includes those tapping benefits through pandemic-specific programs introduced last year, including those for self-employed workers.

I wonder how much all the news about ‘Phant governors terminating benefits might be behind the drop in ongoing claims.

The stimulus from extended employment benefits are tapering off, and this will adversely effect the recovery.

The only question is how much this will effect the recovery.

An Unalloyed Bit of Good News

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Lina Khan, who shot to fame when her article in the Yale Law Review, Amazon’s Antitrust Paradox, mainstreamed an new (actually old, pre-1970) and aggressive anti-trust policy.

Since then she has been a leading voice in the movement for forceful and expansive enforcement of anti-monopoly enforcement, and now, she has been confirmed as Chair of the FTC.

Hopefully, this presages a much more assertive approach to monopolies by the agency:

In a move that heralds a growing effort to check the power and influence of Big Tech, President Biden on Tuesday appointed Lina Khan, a top antagonist of the tech industry, to chair the Federal Trade Commission, the federal government’s primary antitrust watchdog.

Biden’s decision to put Khan in charge of the FTC’s agenda is the clearest sign yet that his administration will take a drastically different approach to regulating the tech giants than did President Barack Obama, whose administration took a largely hands-off approach toward Silicon Valley.

………

Khan, 32, is known for her unconventional proposals to counter the tech giants’ power. While still in law school in 2017, she wrote a paper denouncing Amazon for what she said was anti-competitive behavior and suggesting U.S. anti-competition laws were poorly equipped to counter the world of e-commerce. (Amazon founder and CEO Jeff Bezos owns The Washington Post.)

Here proposal is not all unconventional. It was a pretty standard view of anti-trust before Robert Bork and Evil Minions™ perverted the field.

………

During her confirmation hearing, she signaled she would take a tough line on regulating tech giants. She said that in the past few years, new evidence has come to light showing there were “missed opportunities” for enforcement actions against tech companies under the Obama administration. She also said new findings show the FTC must be “much more vigilant” when it comes to large acquisitions in digital markets.

Khan also said she was particularly concerned about the ways in which large companies use their dominance in one market to give them an upper hand in others, an issue under intense scrutiny by Congress.

Hopefully, this presages an extremely muscular by the Federal Trade Commission.

It’s All of the “Gig Economy” Companies

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Amazon just settled a lawsuit where it stole tips from its drivers.

The short version is, they used tip data to lower rates to drivers in specific areas.

This is the very epitome of how companies like Amazon, Uber, Lyft, DoorDash, etc. use opaque algorithms to cheat their employees:

The US Federal Trade Commission on Friday announced the approval a consent order against Amazon that requires the company to pay $61.7m to resolve charges that for two and a half years it took tips intended for Amazon Flex drivers and concealed the diversion of funds.

………

The tech giant launched its Flex service in 2015, promising drivers – which it classified as independent contractors and referred to as “delivery partners” – that it would pay $18-25 per hour for the delivery of goods from Amazon.com, Prime Now (household goods), Amazon Fresh (groceries), and Amazon Restaurant (takeout).

Amazon’s ads made promises like, “You will receive 100 per cent of the tips you earn while delivering with Amazon Flex.”

However, during the period from late 2016 through August 2019, drivers – who, as independent contractors, paid for their own car, fuel, maintenance, and insurance – saw only a portion of the promised gratuity when customers opted to tip.

That’s because Amazon allegedly, without telling its drivers, shifted to a “variable base pay” rate, which varied by location, wasn’t disclosed to drivers, and was frequently lower than the promised hourly range.

“Under the variable base pay approach, for over two and a half years, Amazon secretly reduced its own contribution to drivers’ pay to an algorithmically set, internal ‘base rate’ using data it collected about average tips in the area,” the FTC complaint [PDF] explains.

………

To make up any difference between the base rate and the advertised minimum, Amazon is said to have used some or all of any tip left by customers to meet its payment commitment. For example, if Amazon set a base rate for a region at $12 and the customer left a tip of $6 via Amazon’s electronic tip collection system, then the company paid the driver only $12 and augmented the payment with the $6 tip, instead of paying the $18.

This is not enough.  People should be going to jail for this, and not just white collar prison.

This should be hard time in a hard prison, not just because of the scope and callousness of the theft, but because the threat of a few years in Terre Haute will get people to turn on higher ups in the operation.

They stole from thousands of their employees, and they did so knowingly, there are numerous internal emails detailing the reputational risk to Amazon.

It’s Jobless Thursday!

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Initial unemployment claims fell from fell to 376,000 from 385,000 last week, which is obviously good news, but year over year inflation jumped to 5%, which means the the usual suspects are going to start screaming for austerity.

As always, I’ll note that with 20+ states rolling back unemployment benefits, stimulus is going away sooner rather than later in those states, and in all 50 states at the end of September, so I will expect back-sliding when that happens.

As to the inflation, the core rate, which excludes food and energy is a lower at 3.8%, and it is dominated by a spike in used car prices, which are in turn driven by a massive shortage of new cars, which is in turn driven by an even more massive shortage of computer chips that go into new cars.

It’s a recovery, and inflation will spike, and quite honestly, with wages going up for people at the bottom end of the scale, it’s a good thing.

I’m waiting for the “Very Serious People” to try to start to screwing things up.

And the Unders Win

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Job growth in May was less than the consensus forecast, 559,000 as versus the consensus prediction of 671,000.

We are in a recovery, one just wonders how fast, and when the benefits will start accruing to the top 1% again.

I would note that the progress of the recovery illustrates an important point:  A world wide pandemic is less capable of doing lasting damage to our society than does business of usual in global finance:

U.S. employers boosted hiring in May, but not enough for the labor market to keep pace with an overall economy that is heating up as the pandemic continues to ease.

Payrolls grew by 559,000 last month, the Labor Department reported Friday, up from a revised 278,000 in April, which marked a sharp drop from March’s figure. The unemployment rate fell to 5.8% in May from 6.1% the prior month.

While the gains marked an uptick from April, they were lower than economists predicted and reflected businesses struggling to fill job openings as potential workers remained on the sidelines. The labor recovery has slowed from earlier in the year—in March, the economy added 785,000 jobs—a development economists say could delay a full labor recovery to well into next year.

That mixed picture cheered investors, who bet the numbers weren’t strong enough to change the Federal Reserve’s course on its easy-money policies. U.S. stocks rose, while the yield on the U.S. 10-year Treasury fell.

Why yes, the stock market is COMPLETELY disconnected from the well being of society, why are you asking? 

We need to stop coddling Wall Street at the expense of Main Street.

New Post Pandemic Low on Initial Unemployment Claims

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I just HAD to meme this

Jobless Claims fell to 385,000 last week.

We are not at a level that is firmly consistent with a normal recession.

I hope that the end of extended unemployment benefits in many states won’t send this backward:

Worker filings for initial jobless claims have dropped by 35% since late April, adding to signs of a healing labor market as the U.S. economy ramps up.

Weekly unemployment claims, a proxy for layoffs, fell to 385,000 last week from a revised 405,000 the prior week, the Labor Department said Thursday. Last week’s decline in claims marked the fifth straight week that new filings fell, from 590,000 the week ended April 24.

“Claims remain elevated by normal standards, but the downward trend has been relentless in recent months, and a return to the pre-Covid level over the summer seems a decent bet,” said Ian Shepherdson, chief economist at Pantheon Macroeconomics.

Thursday’s reading brings the four-week average of initial claims—which smooths out volatility in the weekly figure—to 428,000, the lowest point since the pandemic began, though still well above pre-pandemic levels. Weekly claims averaged around 220,000 in the year before the pandemic.

Economists separately expect that the May employment report, set to be released Friday, will show that the economy added 671,000 jobs last month, after gaining 266,000 in April, and that the unemployment rate fell to 5.9% in May from 6.1% the prior month.

 My guess is that the jobs number will be close to the consensus, but (as always) I’ll take the under.

One Study, but Not a Surprise

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The San Francisco Fed has issued a report that the labor market is throwing out thoroughly conflicting signs, which means that the current main employment numbers may be overstating the recovery:

U.S. labor market signals are conflicting to an “unprecedented” degree, but those suggesting labor market slack should be given more weight than those pointing to tightness, according a paper published Monday by the San Francisco Federal Reserve Bank.

The paper looked at 26 labor market measures that typically move in tandem and found that during the current recovery they are giving wildly divergent signals about the health of the job market.

The job openings rate, for instance, suggests the job market is much tighter than the unemployment rate; the labor force participation rate points to much more slack than detected in the unemployment rate.

Because the pandemic has forced so many people out of the workforce, “negative signals such as the low labor force participation rate provide a better read than do the positive signals,” the researchers argued. “Overall, our findings reveal that the labor market situation is worse than some headline numbers suggest.”

That’s what my gut says as well, but my gut does not routinely access finer granularity employment and economic data.

Of Course They Are

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Hoocoodanode?

After making nice to the drivers in order to get Proposition 22 passed, Uber and Lyft have reversed their employee friendly policies, because their drivers are disposable, and they have no more need to make nice with them.

This outcome was completely predictable:

Last year, the ride-hailing service Uber gave its drivers unprecedented control over their fares and working conditions.

The goal was to win drivers’ support for Proposition 22, through which Uber and other gig companies aimed to rewrite California labor law in the companies’ favor.

The firms’ pitch was that the ballot measure would preserve the “flexibility” in hours and earnings that their workers valued, and that they said would be threatened unless the labor law was changed.

Uber’s new options seemed to make that flexibility more real: The company gave drivers more latitude to set their own fares, and more visibility into the trips they were offered before deciding whether to accept them.

Proposition 22 was passed by an overwhelming margin in the November election. Since then, some drivers say, Uber has taken the flexibility options away, and even cut the drivers’ income on many trips.

Lyft executives raised the same alarm during a Wall Street conference call after the firm released its first-quarter financial results on May 4.

Driver advocates have greeted these remarks skeptically, noting that the firms could attract more drivers quickly by improving their pay.

………

But when California codified labor rules to mandate that such workers receive all the benefits of employees, Uber, Lyft and other gig companies drafted Proposition 22 to exempt their drivers, delivery workers and others from the employment rules and allow them to be classified as independent contractors.

After a campaign in which the companies spent more than $200 million, a national record for a ballot measure, Proposition 22 passed with nearly 60% of the vote.

“A huge part of their Proposition 22 campaign was to get the drivers on their side,” says Veena Dubal, a labor law expert at UC Hastings College of the Law and a critic of Uber and Lyft. “So they rolled out these things they knew that drivers would be excited about and would make them feel independent. And of course they’ve thrown them away.”

………

Support for the bill has been waning since organized labor took a closer look at its terms. They discovered that it would bar workers from striking or taking any other job action and forbid local governments from imposing a minimum wage for gig workers.

………

Uber also has sharply cut drivers’ pay for trips originating at Los Angeles International, San Francisco and San Diego airports. At LAX and San Diego, drivers say, they now receive 32 cents per mile, regardless of the distance traveled.

That’s down from about 60 cents before the passage of Proposition 22, drivers say. It’s also well below the 56 cents per mile that the Internal Revenue Service has set as the deductible cost of ownership of cars driven for business use, counting fuel, maintenance, insurance and wear and tear.

It’s like the tale of the scorpion and the frog, it’s in their nature.

You should not be surprised when it stings you.

Karen²

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Amy Cooper, who was caught on tape attempting to use the police to murder a bird watcher who noted that her dog needed to be leashed in that area of Central Park, has now sued her former employer, who fired her for the episode.

She is now claiming that she was fired because she was white.

My guess is that she has discovered that she is justifiably toxic and cannot get a new position anything near to what she used to do.

Consequences are a good thing, and they should apply to white people as well:

Amy Cooper, a white woman who last year became an international symbol of the routine racism that Black people face in their daily lives, is suing her former employer for firing her, arguing that she is a victim of racial discrimination.

Ms. Cooper makes the claim in a lawsuit filed this week against the investment firm Franklin Templeton, which terminated her employment a year ago after she was captured on a widely shared video in a tense encounter with a Black bird-watcher.

The lawsuit is the latest fallout from the May 2020 episode in Central Park, which touched off intense discussions about the history of white people making false, and sometimes life-threatening, accusations against Black people to the police.

………

She says in the suit, which was filed in federal court in Manhattan, that she “did not shout at Christian Cooper or call the police from Central Park on May 25, 2020, because she was a racist — she did these things because she was alone in the park and frightened to death.” She goes on to say that Mr. Cooper had selected her as a “target” and describes him as “overzealous.”

And the suit argues that Franklin Templeton did not thoroughly investigate the situation because of Ms. Cooper’s own race and gender, effectively reaching its decision to terminate her because she is a white woman.

They terminated you because are a self-important bigot, and people won’t hire you for the same reason.

The fact that you are a horrible human being who got caught on tape is karma, not oppression.

Another Improvement in Initial Jobless Claims

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Initial claims have fallen to a new post pandemic low of 406,000.

Better news, but not exactly good news until the number falls below 300K:

Worker filings for jobless benefits fell again to a fresh pandemic low, extending a steady downward trend and adding to signs of a healing labor market and a broader, though uneven, economic recovery.

Initial unemployment claims for regular state programs, a proxy for layoffs, fell last week to 406,000 from 444,000 the prior week, the Labor Department said Thursday. That level represents the lowest levels of claims since the coronavirus pandemic’s onset last year and the fourth consecutive week claims have reached a new pandemic low. Economists surveyed by The Wall Street Journal had forecast there were 425,000 new claims last week.

A separate report from the Commerce Department showed orders for cars, appliances and other long-lasting, or “durable,” goods fell a seasonally adjusted 1.3% in April from March—the first monthly decline in demand for such products in a year. The decline was concentrated in the automotive sector, where a semiconductor shortage has caused disruptions, and the defense industry, which tends to be very volatile. Shipments of motor vehicles and parts fell sharply as well, while shipments of defense capital goods rose.

………

U.S. gross domestic product, a broad measure of the economy’s output of goods and services, rose in the first quarter at an annual rate of 6.4%, unrevised from the initial estimate, according to another Commerce Department report. Consumer spending, the economy’s key driver, was revised up to an annual rate of 11.3% in the first three months of the year.

It’s clear that the first quarter numbers, while quite good, are not sustainable.  It’s a rebound from the economic contraction of the past year.

I would expect GDP growth numbers to return to trend, around 2½%.

Clearly, We Need More of This, Not Less

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Colorado has added a requirement that job postings must include a salary range, so as to minimize wage disparities between white men and everyone else.

In response, companies have begun posting job openings specifically excluding Colorado, because they can keep wages lower if the applicants do not know what they are willing to pay.

The solution to this is not to revoke the Colorado statute, but to make it universal:

DigitalOcean is looking to hire a front-end software engineer who, if working remotely, is free to live anywhere in America, Canada, Germany, or Netherlands, but not in Colorado.

The US state in 2019 approved the Equal Pay for Equal Work Act and then formulated rules to apply the law [PDF], which went into effect on January 1, 2021. The statute requires, among other things, that companies posting job listings for in-state or remote positions include a salary amount or salary range. The intended purpose of the regulation is to prevent pay disparities.

DigitalOcean, which advertises about how it supports “a diverse and inclusive workplace,” does not explain specifically why it won’t consider hiring Colorado residents for remote positions, but its now-changed help wanted ad does make clear that Colorado is to blame.

“This position may be done in NYC or Remote (but not in CO due to local CO job posting requirements),” the online post said.

………

Many other firms have included similar language in their job ads.

Alcohol e-commerce platform Drizly is also looking for a remote Senior Software Engineer, anywhere except Colorado. “Please note: this role can be performed remotely anywhere in the United States with the exception of Colorado,” its job listing explains.

………

In a post last November to legal website JD Supra, Littler Mendelson PC attorneys Jennifer Harpole and Joshua Kirkpatrick, wrote that an exemption to the compensation inclusion requirement “makes it even more likely that multi-state employers with remote jobs will exclude Colorado workers from consideration…”

Make it a national requirement.  Problem solved.

Boeing Still Can’t Build Planes, Part 4⁹

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In 2019, a sweeping transformation of Boeing’s quality system deliberately eliminated thousands of quality checks during production and cut 100s of quality inspector jobs.

Ernesto Gonzalez-Beltran, the architect of that shift, left the company in Decemberhttps://t.co/SbcHIzcnFp

— Dominic Gates (@dominicgates) May 18, 2021

Roll Tape!

Boeing has finally been forced to accept the fact that axing hundreds quality inspectors in order to bust the union did now work, and now they are rehiring the inspectors that they laid off, and they canned the architect of the failed program:

The Boeing Co. has quietly recalled at least some of as many as 900 quality control inspectors who were laid off in 2019 as part of a drive to adopt car-industry manufacturing processes in aerospace manufacturing.

The move comes after the union for the inspectors – Machinists District Lodge 751 – pushed the company to prove that getting rid of inspectors could be done without risking quality issues and would actually improve production times.

“Our union’s goal is to save Boeing from making decisions that could be detrimental to (its) future and ours,” union leaders said in its monthly AeroMechanic newsletter. “A second set of eyes is a critical component of building Boeing airplanes and necessary for the long-term success of the company.”

A union spokeswoman said she was unable to say precisely how many of the inspectors were initially laid off, and how many have been brought back since the recalls started. Boeing’s media relations team did not respond to a written list of questions on the topic.

………

In theory, if you eliminate the downtime and the inspections a few thousand times on each plane, that adds up to substantial savings in production time without any investment in people or tools.

IAM 751 appealed to the Federal Aviation Administration to look into Boeing’s plan and made rumblings about getting its supporters in Congress to intervene. Congress is now preparing an investigation into quality lapses at Boeing.

But the deciding factor, in this case, seems to have been the union’s demand to enter into what’s called effects bargaining. Since Boeing was eliminating 900 jobs, the union claimed the right to negotiate over the impact of those changes on its members.

As a result of these talks, Boeing and the union agreed that a team of union-appointed experts would begin reviewing data in areas where inspections were ending, with the ability to propose reinstating inspections when warranted, using Boeing’s own risk assessment criteria and FAA regulations as guidelines.

No Efficiency Gains

What the experts found was that eliminating inspections did not lead to a more efficient production process, the union said.

They f%$#ed up their quality processes for nothing more than the hope that they could fire some union members, and they failed.

If you fired Boeing’s entire C-Suite and replaced them with dirnking bird toys, you would increase productiveity and product quality.