It would appear that 10% unemployment is going to be the new normal for quite some time. The National Federation of Independent Businesses released a report which comes as no real surprise to anybody outside of D.C. or not employed by the Imperial Federal Government or "public" sector.
The National Federation of Independent Businesses said its Small Business Optimism Index dropped 3.2 points to 89.0 last month, more than erasing the modest 1.6-point gain it saw in May. The report, which was compiled by NFIB Chief Economist William Dunkelberg, described the decline as “a very disappointing outcome.”
In past periods following a recession, the NFIB index typically has risen back above 100 within a quarter or two of the trough in economic activity as measured by the National Bureau of Economic Research. That hasn’t been the case during this recovery. The index hasn’t broken above 93 in any month since January 2008 when the economy was in the early stages of recession, even though the NBER is expected to eventually date the beginning of the recovery in the third quarter of last year.
In 23 of those past 30 months, readings have come in below 90, an unprecedented result in the survey’s history, the NFIB said.
Some 70% of the 3.2-point decline in June was explained by weaker expectations for business conditions and real sales over the next six months, the report said.
Businesses, big and small have pared their workforces to the bare bones already, and cuts are still happening. Payroll is always the biggest expense for a business and the normal model in the past was for companies to cut staff, show a profit for a quarter or two allowing the CEO to get his bonus and then do some modest rehiring. In today's environment no such hiring is occurring.
The workforce is being further strained by having to work harder and longer because after all in a lot of cases the work hasn't gone away just the workers, particularly in IT fields. The manufacturing and blue collar jobs are gone. America needs to figure out how to restart this sector, and it probably can be done if you keep the unions out of it. The biggest impediment here is the fact that Americans are still unwilling to accept a lower standard of living then they have become accustomed to. Instead of having 3 cars and all the latest electronic gadgets they can't bring themselves to downsize to 1 car and passing on the latest Apple® product.
Nothing, and mean nothing, is going to improve the conditions as long as those entitlement lords of the Democrat party are in control of our fiscal policies.
And can we quit calling this a recovery unless by recovery you mean a patient who was admitted for a hernia and had it repaired now has a flesh eating virus, but hey the hernia is fixed.
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