NZ Post

NZ Post says job cuts needed to stay competitive

New Zealand Post says it needs to make redundancies so the business can stay competitive in a tight market.

Radio New Zealand,

14 February, 2013

The company announced on Thursday it is axing 100 workers in Wellington and Auckland, saying the job losses are the result of an upgrade of its printing systems.

The New Zealand Post-owned print and mailing house Datam will close its plant at Petone near Wellington at the cost of 75 jobs, and some Auckland roles.

However, 30 new jobs will be created at its Christchurch plant.

Spokesperson John Tulloch said on Thursday the decision has been driven by new technology which can do more work with fewer workers and the company is working to relocate employees where possible.

The Engineering, Printing and Manufacturing Union said the redundancies have come as a shock to workers.

Postal sector organiser Joe Gallagher said the union has serious concerns about the state of the job market for its members.

Sign of the times - Joyce

Economic Development Minister Steven Joyce says it is always a concern for people who lose their jobs, but more lay-offs reflect the changing state of the economy.

As well as the New Zealand Post job cuts, Contact Energy said on Wednesday it plans to cut more than 100 positions in the face of flat demand for electricity.

Mr Joyce said on Thursday the situation is reflection of the state of international and domestic economies.

"We're getting lower levels of growth than we have historically, and that's because of the global financial crisis. We are seeing growth in some areas, but we're seeing job losses in other areas as well.

"So it's not easy, it's still challenging but actually anybody who suggests they could wave a magic wand and make it disappear is, frankly, just having you on."

QE3

Comments from Wes Miller of CollapseNet

The path of our destruction has been chosen --> print more money, put off a crash in the financial markets for a few months (they hope) and thereby guarantee Obama's re-election, all of which comes at the cost of creating another international commodities bubble driving food prices much higher and thereby starving poor people and risking greater global upheaval/revolution. After all that, or maybe even at some point as soon as this winter, we will still have our financial markets crash anyway...it is as inevitable as the sunrise with the Eurozone mess and China's imminent crash compiled on top of our own economic charade.

I think the only US economic policy left, and it is apparently the one chosen, is to try to be the "last man standing" amid global economic chaos and wreckage. Put another way, faith in the dollar and the "full faith and credit" of the US government would normally be severely undermined by this Fed move. The US gets away with its reckless financial policies only because of the misery and uncertainty that exists everywhere else in the world right now. If the EU and/or China were sufficiently strong, this move by the Fed would likely have been fatal to the dollar and to Treasuries. As it stands today, there is no other "safe" place for investors to park their money and earn a return (other than gold in our opinion), so the Fed can skate by with this...for a little while at least (like past November). 

Free money for banksters, force as many investors as possible into the Wall Street casino (thereby propping it up) because there is no incentive to save money with zero interest rate policies for 3 more years, and force higher prices for everything onto the rest of us...until it all comes crashing down. That's where we are heading. While the crash may be delayed, it will only be bigger and uglier when it happens - we'll have farther to fall and less value to our money. Use whatever extra time the Fed has borrowed to get as ready as you can. - Wes

Fed Announces Aggressive New Stimulus To Combat Unemployment

The Fed just hit the economy with a double-barreled blast of stimulus.

Huffington Post,

26 April, 2012

The Federal Reserve on Thursday announced a new round of bond buying, with the new wrinkle of basically leaving the program open-ended. It also stretched out its promise to keep short-term interest rates near zero by a year, "at least through mid-2015."

The moves will be controversial, particularly coming less than two months ahead of a heated presidential election. The Fed is already being accused of risking runaway inflation with its previous stimulus programs. And now it will likely come under fire for trying to boost the economy, which could benefit President Obama's re-election chances. In a statement, Obama's rival, Republican nominee Mitt Romney, called the Fed's actions "artificial and ineffective."

The Fed said it had no choice but to act in response to stubbornly high unemployment, sluggish economic growth and the risk of a fiscal-cliff recession at the turn of the year. The Fed hopes buying billions in mortgage bonds will boost the housing market, stock prices and other areas of the economy, helping speed up growth and bring down unemployment.

"I don't think it's a panacea. I don't think it's going to solve the problem," Fed Chairman Ben Bernanke said of the Fed's decision, in a press conference following the announcement. "But I do think it's going to have enough force to move the economy in the right direction."

As it was, some economists and market participants expressed disappointment that the Fed's new buying program was not bigger.

"Overall, the Fed has done all the markets were asking for," Paul Ashworth, chief U.S. economist at Capital Economics, wrote in a note. "The problem is that we doubt it will be enough to get the economy on the right track. It's only a matter of time before speculation begins as to when the Fed will raise its purchases."

Though financial markets had expected the Fed to act, they cheered the announcement nonetheless. The Dow Jones Industrial Average ended the day 206.51 points higher, up from a 12-point gain just before the Fed's announcement. At 13,539.86, the Dow closed at its highest level since December 2007, and within 640 points of its record-high close, set in October 2007.

Other financial assets reflected concerns about higher inflation, or at least about the devaluation of the dollar. Gold surged 1.5 percent to $1759 an ounce, its highest price in six months, while the U.S. dollar slumped against other major currencies.

Though critics warn that the Fed is toying with hyperinflation, Bernanke argued in his press conference that overall consumer price inflation has stayed more or less around the Fed's target of 2 percent per year despite the Fed's extraordinary efforts to boost the economy.

The Fed in its statement on Thursday said it plans to buy $40 billion in mortgage-backed securities every month and continue another program, called "Operation Twist," in which it trades short-term bonds for long-term bonds. Along with another program to reinvest income from bonds it already holds into buying more mortgage-backed securities, the Fed expects to add $85 billion to its balance sheet until the end of the year.

In an unusually aggressive step, the Fed also said it would buy more bonds, and consider other measures, if unemployment, currently at 8.1 percent, does not start falling more quickly:

"If the outlook for the labor market does not improve substantially, the Committee will continue its purchases of agency mortgage-backed securities, undertake additional asset purchases, and employ its other policy tools as appropriate until such improvement is achieved in a context of price stability," the Fed said.

In updated economic projections, the Fed said it doesn't expect unemployment to fall below 7 percent until 2015. If the Fed buys $40 billion in mortgage bonds every month between now and then, Capital Economics estimated, that could amount to $1.4 trillion in total bond-buying. That sounds like a lot, but it would basically match the total amount of the Fed's first round of bond-buying, but stretched out over about twice the length of time.

In his press conference, Bernanke sounded dire notes about the state of the job market, saying "the employment situation continues to be a grave concern." Pointing out repeatedly that Fed action was not a "panacea," he also suggested that Congress do its part to help the job market. In particular, he warned of the "fiscal cliff" of tax hikes and spending cuts looming at the end of the year, which many economists have said could trigger a deep recession.

"I don't think our tools are strong enough to offset effects of major fiscal shock," he said.

One FOMC member, Richmond Fed President Jeffrey Lacker, dissented from the Fed's decision, disagreeing with more bond purchases and the extension of the low-rate promise. Quantitative Easing, another term for bond-buying, has been a controversial approach to monetary policy, with critics saying it raises the risk of inflation and financial bubbles while not helping the real economy. Last year, Texas Governor Rick Perry warned that Bernanke would be treated "pretty ugly" in Texas if he "prints more money."

In a recent Wall Street Journal poll, economists said they thought a $500 billion bond-buying program would only cut unemployment by 0.1 percent and raise annual gross domestic product by 0.2 percent. That's a negligible benefit, if those estimates are true.

"Investors and business leaders face a paralytic Congress and a gallimaufry of downside fiscal and geopolitics risks," Bernard Baumohl, chief global economist at the Economic Outlook Group in Princeton, wrote in an email. "Try as it might, the Fed cannot prompt the economy to do much more under these circumstances."

Bernanke himself has countered that he thinks previous rounds of QE created 2 million jobs and raised gross domestic product by 3 percent.

And the Fed's promise to keep rates low until 2015 could in effect be a small measure of stimulus all by itself, as it could nudge interest rates lower throughout the economy.

"The important part of the Fed decision is more about shaping expectations--we're here to help--than just printing money," Justin Wolfers, associate professor at the Wharton School, wrote in a tweet.

French unemployment

There won't be more jobs next year – that much is clear.

Unemployment continues to rise in France

After rising non-stop for the past 15 months, French unemployment is at its highest level in over a decade. All in all, 4.7 million are looking for jobs, be it in mainland France or in oversees French territories.

The Great Recession: The Illusory Recovery

Laid-Off US Workers Are Taking Huge Pay Cuts At Their New Jobs

The U.S. economic recovery hasn't felt much like one even for people who managed to find new jobs after being laid off. Most of them have had to settle for less pay.

Business Insider,

26 August, 2012

Only 56 percent of Americans laid off from January 2009 through December 2011 had found jobs by the start of this year, the Labor Department said Friday. More than half of them took jobs with lower pay. One-third took pay cuts of 20 percent or more.

The figures would be even lower if people who could find only part-time jobs were included in the total.

The report provides an illustration of the job market's persistent weakness well after the Great Recession officially ended in June 2009. It also documents that while the economy has added nearly 3 million jobs since the recovery began, many pay less than those that were lost.

And it points to the challenge for President Barack Obama, who's seeking re-election with unemployment at 8.3 percent. No president since World War II has faced re-election with unemployment above 8 percent. It was 7.8 percent when Gerald Ford lost to Jimmy Carter in 1976.

Laid-off workers always have a harder time finding new jobs than do people who quit. But since the government began tracking such data in 1984, people who lost jobs in a recovery haven't had it as hard as they did in the one that began three years ago.

And the pay cuts in their new jobs usually aren't so deep.

For example, in 2003-2005, a period that included a slow recovery, nearly 70 percent of those who were laid off found jobs. More than half who found full-time work in that time did so at equal or higher pay.

The government compiles data on laid-off workers every two years. The report covers only people who had worked at least three years in the same job before being laid off. In doing so, it focuses on those who had stable careers before they lost work.

They are people like Andrew McMenemy, who used to make $80,000 a year as a computer systems administrator at a software firm. He was among the 80 percent of the firm laid off in March 2010.

Now, he makes $9.15 an hour, providing tech support for Apple. The job offers no benefits. He works from home in East Stroudsburg, Pa., where he lives with his father.

"I'm going to be 53; I have to live at home with my father," McMenemy said. "I made more when I worked in high school."

About 6.1 million people with at least three years on the job were laid off in the three years ending in 2011, the government's report said. That's down from 6.9 million in the previous report, which covered the 2007-2009 period. But it's still the second-highest total since 1984.

Though the proportion of laid-off workers finding jobs has improved since the 2007-2009 period, "by no means are they back to a normal level for a recovery," said Henry Farber, an economics professor at Princeton University.

Compared with most other recoveries, "this is really bad," said Dean Baker, an economist and co-director of the Center for Economic Policy Research, a liberal think tank.

Baker noted that only 15 percent of those laid off in 2009 through 2011 have found new jobs with equal or higher pay. That compares with 25 percent in the three years before the recession.

"You were much more likely to be re-employed in 2007 at the same or higher wage than now," he said.

An Associated Press analysis this month documented that by just about every measure, this economic recovery is the feeblest since the Great Depression. The weakness goes well beyond high unemployment. Economic growth has never been weaker in a postwar recovery. Consumer spending has never been so slack. And even for people who have jobs, paychecks have fallen behind inflation.

The Labor Department report Friday showed that men were more likely than women to regain jobs after a layoff. Male-dominated fields, such as manufacturing and mining, have experienced some of the strongest job gains. By contrast, hiring has been below average in some occupations with mostly female workers, such as office and administrative support.

That would come as no surprise to Kim Pinto, who lost her job in November 2009 as an executive assistant and office manager at a commercial interior design firm. Pinto, 50, who lives in Plymouth, Mass., was unemployed for nearly two years before landing a job as a sales person at a furniture store in July 2011.

Her new job pays roughly half the $52,000 she earned at her former job. The new one offers health insurance. But she can't afford the premium.

Pinto considered the sales job a "life raft" until she could find something better. She's still looking, and the competition is fierce. She applied for an administrative position at a local police station. There were 186 applicants, she was told.

"I've always worked a full-time job with benefits," Pinto said. "It's almost like that's a thing of the past. It really erodes your self-esteem."