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What to watch on jobs day: A strong finish to 2021, but Omicron’s impact looms

In an unprecedented change, the Bureau of Labor Statistics (BLS) released the monthly Job Openings and Labor Turnover Survey (JOLTS) the same week as the monthly employment situation report.

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In an unprecedented change, the Bureau of Labor Statistics (BLS) released the monthly Job Openings and Labor Turnover Survey (JOLTS) the same week as the monthly employment situation report. Given this new release schedule, I’m going to talk about what we learned from this week’s JOLTS report, which provides data for the full month of November (or the end of November, depending on the specific measure) as a preview for the jobs day release on Friday, because the reference week for Friday’s numbers is shortly after at December 5-11. This means that the rapid Omicron variant surge in the United States will not affect the trends released on Friday, as job growth is expected to approach 7 million for 2021 as a whole.

The JOLTS report for November continued to show high levels of churn in the labor market and strong net job growth. Job openings ticked down a bit, while hires ticked up and quits hit another series high. The media has focused on the high quits rate, but what’s often missing from that coverage is that workers who are quitting their jobs aren’t dropping out of the labor force, they are quitting to take other jobs. Hiring continues to outpace the number of quits, and the labor force continues to claw its way back after a huge drop in the spring of 2020. While the majority of job losses added to the ranks of the unemployed (+17.4 million), the labor force fell by nearly 8 million workers in March and April 2020 and has regained about 70% of those losses since then, including an increase of 1.8 million over the last nine months, when the quits rate has been so high.

Much attention throughout the recovery has been on accommodation and food services, which suffered the greatest losses in employment when the pandemic hit and is now experiencing record-high levels of quits. In November 2021, accommodation and food services recorded nearly a million quits (920,000). But—and here’s the part many commentators seem to be missing—hiring in accommodation and food services exceeded quits in November, coming in at over 1 million (1,079,000).

It’s useful to note that accommodation and food services always tends to have more churn than other sectors. In particular, accommodation and food services has always exhibited a higher quits rate than any other sector (since the survey began in 2000) and the highest or second-highest hires rate (second only to arts, entertainment, and recreation). High churn in this industry is not surprising given that it’s also the lowest paid of the major sectors in the U.S. economy, but quits are happening to a much greater extent now than ever before—with a bigger increase than in any other sector. This fact, combined with the strong wage growth seen in this industry in 2021, implies workers are leaving their jobs to take jobs with higher pay, likely often within the same sector.

The figure below tells us what’s happening with churn across the labor market, charting the hires rate against the quits rate for major sectors using the latest JOLTS data from November. The 45-degree line represents where hires and quits rates are equal. Notably, all the data lie above the 45-degree line, meaning that hiring exceeds quits in all sectors. So, while there are record numbers of quits, workers aren’t just leaving the labor force: most are taking other jobs, often in the same sector.

The size of the sector bubbles represents average hourly wages of private-sector workers in each sector: the smaller the bubble, the lower the wage. Accommodation and food services—with the lowest wages across sectors—is experiencing the highest churn, i.e. high rates of both quits and hires. Financial services—second in average wages only to the highest wage information sector—experienced the least amount of churn. Workers aren’t switching jobs in those higher paid sectors—which likely also have better benefits and working conditions, including safety and health standards—at nearly the rate they are in accommodation and food services.

The employment situation report—with data on payroll employment and the unemployment rate—also provides a promising picture of the state of the labor market—before the Omicron variant surge hit the United States. Average monthly job growth came in at 555,000 for the first 11 months of 2021, and if initial expectations are realized, employment may approach nearly 7 million jobs added over the year.

The unemployment rate also improved significantly over the year: from 6.7% at the end of 2020 down to 4.2% in November 2021, while the labor force participation rate also rose modestly, from 61.5% at the end of 2020 to 61.8% in November. If the labor market continues on this track, the unemployment rate will easily hit pre-pandemic levels by the end of 2022 while also absorbing much of the temporarily sidelined labor force as well as population growth.

When the jobs report is released on Friday, I expect a continuation of the trends we’ve seen over the last few months: a swift and steady return to labor market health. The speed of this recovery in 2021 has been far faster than the recoveries from the last three recessions—more than twice as fast as any 11-month period in the recovery from the Great Recession when the pursuit of austerity resulted in an unnecessarily slow recovery.

This faster growth in 2021 was fueled by the Biden administration’s American Rescue Plan, despite its effects waning significantly over the last several months with no additional economic impact payments and the expiration of enhanced insurance benefits. However, the expanded child tax credits certainly continued to play a vital role in supporting families through the end of 2021 (e.g., lessening food inadequacy) as well as feeding the recovery itself through increased spending (though it was, inexcusably, allowed to expire at the end of 2021).

Given that fiscal stimulus is on track to wind down substantially in 2022, even if the longer-term investments promised in the much-needed Build Back Better Act are realized, it is vital that Federal Reserve policymakers allow the recovery to continue without contractionary measures like interest rate hikes. Though it will not affect the trends released on Friday for December, the surge of the Omicron variant will likely put a dent in the positive news in the January data, when they are released on February 4. Hopefully, that effect will be shorter-lived than the Delta impact on the labor market and the labor market will continue its swift recovery.

But even when we regain pre-pandemic labor market conditions, it is important not to overstate the wonders of that labor market. Black workers had a higher unemployment rate before the pandemic than white workers have now. Disparities in wage levels were wide and occupational segregation was rampant. Parents had trouble accessing high-quality child care and millions of people lived in poverty. We need to continue to make investments in our physical and human capital infrastructure to grow back faster and stronger.

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Economics

Global Industry Statement on the WTO Moratorium on Customs Duties on Electronic Transmissions

Global Industry Statement on the WTO Moratorium on Customs Duties on Electronic Transmissions
PR Newswire
NEW YORK, May 17, 2022

NEW YORK, May 17, 2022 /PRNewswire/ — The United States Council for International Business (USCIB) joined today nearly…

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Global Industry Statement on the WTO Moratorium on Customs Duties on Electronic Transmissions

PR Newswire

NEW YORK, May 17, 2022 /PRNewswire/ -- The United States Council for International Business (USCIB) joined today nearly 100 other global trade and industry associations to urge WTO members to renew the Moratorium on Customs Duties on Electronic Transmissions at the 12th WTO Ministerial Conference in June.

According to the statement, allowing the Moratorium to expire would be a historic setback for the WTO, representing an unprecedented termination of a multilateral agreement in place nearly since the WTO's inception – an agreement that has allowed the digital economy to take root and grow. All WTO members have a stake in the organization's continued institutional credibility and resilience, as well as its relevance at a time of unprecedented digital transformation.

Continuation of the Moratorium is critical to the COVID-19 recovery. As detailed by the United Nations, the World Bank, the OECD, and many other organizations, the cross-border exchange of knowledge, technical know-how, and scientific and commercial information across transnational IT networks, as well as access to digital tools and global market opportunities have helped sustain economies, expand education, and raise global living standards.

Continuation of the Moratorium is also important to supply chain resilience for manufacturing and services industries in the COVID-19 era. Manufacturers – both large and small, and across a range of industrial sectors – rely on the constant flow of research, design, and process data and software to enable their production flows and supply chains for critical products.

The Moratorium is particularly beneficial to Micro, Small and Medium-Sized Enterprises (MSMEs), whose ability to access and leverage digital tools has allowed them to stay in business amidst physical restrictions and lockdowns.

Failure to renew the Moratorium will jeopardize these benefits, as customs restrictions that interrupt cross-border access to knowledge and digital tools will harm MSMEs, the global supply chain, and COVID-19 recovery – increasing digital fragmentation. As UNCTAD has explained, such fragmentation "reduces market opportunities for domestic MSMEs to reach worldwide markets, [and] ... reduces opportunities for digital innovation, including various missed opportunities for inclusive development that can be facilitated by engaging in data-sharing through strong international cooperation.... [M]ost small, developing economies will lose opportunities for raising their digital competitiveness." 

The rest of the statement can be found here.

Media Contact: Kira Yevtukhova, kyevtukhova@uscib.org

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SOURCE United States Council for International Business

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Government

“The Real President Is Whoever Controls The Teleprompter”: Musk Delivers Scathing Criticism Of Biden

"The Real President Is Whoever Controls The Teleprompter": Musk Delivers Scathing Criticism Of Biden

Authored by Jack Phillips via The Epoch…

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"The Real President Is Whoever Controls The Teleprompter": Musk Delivers Scathing Criticism Of Biden

Authored by Jack Phillips via The Epoch Times,

Tech billionaire Elon Musk this week warned that the United States must take steps to address inflation or it will end up like socialist Venezuela.

Musk, who is currently in the process of acquiring Twitter, told a virtual conference that he believes the government has printed too much money in recent years.

“I mean, the obvious reason for inflation is that the government printed a zillion amount of more money than it had, obviously,” Musk said, likely referring to COVID-19 relief stimulus packages worth trillions of dollars that were passed in recent years.

U.S. inflation rose by 8.3 percent in April, compared with the previous year. That’s slightly lower than the 8.5 percent spike in March, but it’s still near the 40-year high.

“So it’s like the government can’t … issue checks far in excess of revenue without there being inflation, you know, velocity of money held constant,” the Tesla CEO said.

“If the federal government writes checks, they never bounce. So that is effectively creation of more dollars. And if there are more dollars created, then the increase in the goods and services across the economy, then you have inflation, again, velocity of money held constant.”

If governments could merely “issue massive amounts of money and deficits didn’t matter, then, well, why don’t we just make the deficit 100 times bigger,” Musk asked. “The answer is, you can’t because it will basically turn the dollar into something that is worthless.”

“Various countries have tried this experiment multiple times,” Musk said.

“Have you seen Venezuela? Like the poor, poor people of Venezuela are, you know, have been just run roughshod by their government.”

In 2018, Venezuela, a country with significant reserves of oil and gas, saw its inflation rise more than 65,000 percent amid an economic crash that included plummeting oil prices and government price controls. The regime of Nicolas Maduro then started printing money, thereby devaluing its currency, which caused prices to rapidly increase.

During the conference, Musk also said the Biden administration “doesn’t seem to get a lot done” and questioned who is actually in charge. 

“The real president is whoever controls the teleprompter,” he said.

“The path to power is the path to the teleprompter.”

“The Trump administration, leaving Trump aside, there were a lot of people in the administration who were effective at getting things done,” he remarked.

Musk’s comment about the White House comes as Jeff Bezos, also one of the richest people in the world, has increasingly started to target the administration’s economic policies. Bezos, in a series of Twitter posts, said the rapid increase in federal spending is the reason why inflation is as high as it is.

“Remember the Administration tried their best to add another $3.5 TRILLION to federal spending,” Bezos wrote on Monday, drawing rebuke from several White House officials. “They failed, but if they had succeeded, inflation would be even higher than it is today, and inflation today is at a 40-year high.”

Tyler Durden Tue, 05/17/2022 - 15:05

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Economics

Summit Healthcare REIT, Inc. COO/CFO Elizabeth Pagliarini participates in the 9th Annual IMN Real Estate CFO & COO Forum

Summit Healthcare REIT, Inc. COO/CFO Elizabeth Pagliarini participates in the 9th Annual IMN Real Estate CFO & COO Forum
PR Newswire
LAGUNA HILLS, Calif., May 17, 2022

LAGUNA HILLS, Calif., May 17, 2022 /PRNewswire/ — Elizabeth Pagliarini, COO…

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Summit Healthcare REIT, Inc. COO/CFO Elizabeth Pagliarini participates in the 9th Annual IMN Real Estate CFO & COO Forum

PR Newswire

LAGUNA HILLS, Calif., May 17, 2022 /PRNewswire/ -- Elizabeth Pagliarini, COO/CFO of Summit Healthcare REIT, Inc. ("Summit") joined five other industry leaders on the Executive Roundtable at the 9th Annual IMN Real Estate CFO & COO Forum at the Monarch Beach Resort in Dana Point, California. The panelists shared their thoughts and experiences regarding the post pandemic environment, namely the recovery progress and how businesses are changing, trends in tenant lease terms, and the transition back to working in the office and its implications for new hires. They also provided insights into the availability of financing and how terms have changed over the past six months, how they are managing supply chain crises, rising costs of sourcing and materials, and staffing shortages, the changes made to core processes over the past 18 months and whether these changes would be permanent, and how investor communications have changed in recent months.

About Summit Healthcare REIT, Inc. 
Summit is a publicly registered non-traded REIT that is currently focused on investing in seniors housing and care real estate located throughout the United States. The current portfolio includes interests in 53 facilities in 14 states. Please visit our website at: http://www.summithealthcarereit.com

This material does not constitute an offer to sell or a solicitation of an offer to buy Summit Healthcare REIT, Inc. 

This release may contain forward-looking statements relating to the business and financial outlook of Summit Healthcare REIT, Inc. that are based on our current expectations, estimates, forecasts and projections and are not guarantees of future performance. Actual results may differ materially from those expressed in these forward-looking statements, and you should not place undue reliance on any such statements. A number of important factors could cause actual results to differ materially from any forward-looking statements contained in this release. Such factors include those described in the Risk Factors sections of the Company's annual report on Form 10-K for the year ended December 31, 2021, and the quarterly report for the period ended March 31, 2022. Forward-looking statements in this document speak only as of the date on which such statements were made, and we undertake no obligation to update any such statements that may become untrue because of subsequent events. We claim the safe harbor protection for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995.

CONTACT
Chris Kavanagh
(800) 978-8136
ckavanagh@summithealthcarereit.com

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SOURCE Summit Healthcare REIT, Inc.

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