History of Financial Crisis, 2007 - 2010

A recent Pew Research Center report in FacTank, on the history of the financial crisis from 2007 to 2010, analyst, Drew DeSilver says that the chart above is packed with the history of the financial crisis and is taken from a Department of the Treasury power point presentation that summarizes the financial crisis. The full report is also available.  The data are taken from Standard and Poor's (S&P) 500 Index which is tracked and reported by the Bureau of Labor Statistics and the Bureau of of Economic Analysis and the Consumer Sentiment Index which is taken from the Survey of Consumers, published monthly by the University of Michigan and Thomson Reuters. 

The chart shows the time of the recession, December 2007 through June, 2009 in grey with the activity of the Standard and Poor's (S&P) 500 Index is shown as a line in blue with the scale on the left side of the chart and the Consumer Sentiment Index is shown as a line in orange with the scale on the right side of the chart.  Important events are placed on the blue line as black dots on their dates, which are displayed at the bottom of the chart. 

themostsearched.org has several resources to help faculty engage students in the economics of today's world. They are "You Fix the Budget" from the New York Times and "Make Your Own Deficit-Reduction Plan" from The Wall Street Journal. Both are freely available. 


Read more:
http://www.pewresearch.org/
http://www.pewresearch.org/fact-tank/
http://www.pewresearch.org/author/ddesilver/http://www.pewresearch.org/fact-tank/2013/09/13/chart-of-the-week-a-stroll-down-financial-crisis-memory-lane/#comments
http://www.people-press.org/2013/09/12/five-years-after-market-crash-u-s-economy-seen-as-no-more-secure/
http://www.washingtonpost.com/blogs/wonkblog/wp/2013/09/11/five-years-after-the-crisis-these-13-charts-show-whats-fixed-and-what-isnt/?wpisrc=nl_wnkpm
http://www.treasury.gov/connect/blog/Documents/FinancialCrisis5Yr_vFINAL.pdf
http://fcic.law.stanford.edu/report
http://fcic-static.law.stanford.edu/cdn_media/fcic-reports/fcic_final_report_full.pdf
http://www.nber.org/cycles/cyclesmain.html

themostsearched.org resources:
http://themostsearched.org/resource/3355
http://themostsearched.org/resource/3903

Minimum Wage Workers in US

In a recent FACTANK blog post, Drew DeSilver wrote “Who Makes Minimum Wage?” that reports 3.55 million hourly workers are at or below the federal minimum, in 2012.  Minimum wage earners comprised 4.7% of the 75.3 million hourly workers in the country and 2.8% of all workers in the US. By comparison in 1979, this group represented 13.4% of hourly workers and 7.9% of hourly and salary workers. These numbers are from the Bureau of Labor Statistics (BLS) which has been studying minimum-wage workers since 1979.  The present-day total number of minimum wage workers, 3.55 million, does not include salaried workers or those from the 19 states and District of Columbia with a minimum wage higher than the federal minimum.  Nearly two million individuals of this group earned less than minimum wage as they are a part of exempt groups, such as tipped employees and certain disabled workers. 

Minimum wage workers are mostly White (78%) and work part-time (64%). Half of this group are women and 50.6% are between the ages of 16 and 24 years. Half of these workers are employed in leisure and hospitality industry. The largest percentage of minimum wage workers lives in the southern region of the US (7.3%) while the smallest percentage lives in the pacific region (1.5%). 

Read more:
http://www.pewresearch.org/fact-tank/
http://www.pewresearch.org/author/ddesilver/
http://www.pewresearch.org/fact-tank/2013/07/19/who-makes-minimum-wage/
http://www.bls.gov/bls/blsminwagedata.htm

Union Membership on the Decline

According to the Bureau of Labor Statistics, the percentage of Americans who were members of a labor union declined by roughly 0.5% between 2011 and 2012. This appears to be part of a larger trend. In 1983, it was estimated by the bureau that 20.1% of Americans belonged to a union. This report also shows a substantial gap between the percentage of private sector workers who belong to a union and the number of public sector workers. More than a third of public sector workers belong to a union but only 6.6% of private sector workers are unionized.

There are also large differences in union membership between states and regions. As evident by the figure, union membership in quite low in many areas of the South but significantly higher in the Midwest, the West, and the Northeast. It also appears that certain people are more likely to be members of unions than others. For instance, union membership stands at 14.9% among those ages 55 to 64 but only at 4.2% among those between the ages of 16 and 24. More men than women are members of union. Union membership also varied by race, with African Americans boasting the highest union membership rate, followed by whites, Asians, and Hispanics.

Unemployment Falls in 305 of 372 Metropolitan Areas

Unemployment in America is slowly improving.  The Bureau of Labor Statistics monthly report on metropolitan area employment and unemployment shows that from July of 2011 to last month, unemployment rates decreased in 305 of 372 metropolitan areas.  The number of areas posting over 10.0 percent unemployment nearly halved from 112 to 67.  Overall, the unemployment rate was 8.3% in July, illustrating a comeback – albeit a sluggish comeback – from when unemployment topped off at nearly 10.0% nationally.  Still though, just 18 of the 372 metropolitan areas registered unemployment rates of less than 5.0%.  To put that figure in perspective, before the recession, the national unemployment rate dipped below 5.0% for over a year.

Wages Drop

On June 28^th the Bureau of Labor Statistics released its County Employment and Wages Fourth Quarter 2011 report.  The report states that the average weekly wage decreased by 1.7% to $955 from the fourth quarter of 2010 to the fourth quarter in 2011.  This decrease marks only the fifth wage loss since the Census began tracking the figure in 1978.  Olmsted, Minnesota experienced the greatest decrease in weekly wages amongst large counties, with pay dropping 21.3%.  In Olmsted the education and health services industries faced the most severe losses with a total wage decline of $287.3 million (-29.1%).

The large counties (population of at least 75,000) leading the way in employment gains were Kern, California; Fort Bend, Texas; Weld, Colorad; Williamson, Tennessee; and Utah County, Utah.  These counties had the highest percentage increase in employment, all of them seeing gains of at least 4.3%.  On a grander scale, the U.S. added 1.8 million jobs since December 2010, putting the national employment at 131.3 million.

Playing Politics with Data

In the increasingly polarized political environment in the United States, it is hard to imagine policy-making becoming even more ideological and subjective.  This is the main concern of two associate professors from Columbia University Emi Nakamura and Jon Steinsson and assistant professor Nicolas Vincent from HEC Montreal in a recent Bloomberg View op-ed.


Sparked by recent legislation passed in the U.S. House of Representatives in early May, the trio outlines a dangerous trend of conservative governments all over the world (Argentina, Greece, and Canada) playing politics with data collection that serves as objective voice in policy-making.  Most notably, Greece's misreporting of budget deficit statistics that resulted in an criminal investigation as the country faced total economic collapse.


According to the authors, "It’s hard to overstate how dangerous the destruction of high-quality, objective statistical information would be."  The three main statistical agencies in the United States - the Census Bureau, the Bureau of Economic Analysis and the Bureau of Labor Statistics - "account for less than 0.05 percent of President Barack Obama’s $3.7 trillion proposed budget." 


This issue is being played out in the media as the budget deficit and economy is the main concern on the minds of voters heading into the upcoming national elections.  Increasing awareness and educating the public about the importance of collecting reliable demographic data could swayvoters as they head to the polls this November.

Unemployment Declines

Dennis Jacobe, Gallup’s chief economist, reports that Gallup’s unadjusted unemployment rate fell to 8.4% in March.  This figure is the lowest since October and November of 2011.  Gallup also found that 9.6% of Americans are working part-time but want to work full-time.  This percentage is down from 10.0% in February, but still higher than the 9.2% seen a year ago.  Gallup also calculates a seasonally adjusted unemployment rate, the formula for which Jacobe says is comparable to the method used by the Bureau of Labor Statistics.  The seasonally adjusted rate fell to 8.1% in March.  The Bureau of Labor Statistics has recently released its regional and state unemployment data, and releases its national jobs numbers Friday.

Unemployment By Industry

In one of the New York Time’s Economix blog posts, Motoko Rich discusses changes in the unemployment rate by industry from February 2011 to February 2012, as reported by the Bureau of Labor Statistics.  While unemployment remained relatively unchanged at 8.3 percent in February “mainly because more people started – or resumed – looking for work,” the data released by the Bureau of Labor Statistics shows quite a bit of variability in unemployment between industries.  For example, as the table from the Bureau of Labor Statistics above shows, construction experienced a 4.7% decrease (from 21.8 % to 17.1%). Agriculture; information; and mining, quarrying, and oil and gas extraction all saw increases in unemployment of 1.1%, 1.7% and 1.6% respectively.  In addition to changes in unemployment rate, the rates themselves also vary widely; agricultural workers experienced an unemployment rate of 19.5% while government workers experienced only 3.9% unemployment.