Tuesday :: Feb 3, 2004

Another 117,000 Planned Layoffs In January


by Steve

I have a simple question: if things are so damn great with the economy, as W, his sycophants, and the talking heads at the investment houses tell us, then why the hell is Challenger and Gray reporting that planned layoffs shot up in January? And we're not talking about a blip here. Planned layoffs last month jumped to over 117,000, the highest number since October. Some of this is expected after the holidays in retail. But the consumer products industry had the highest layoffs ever in January, and this came as the economy was supposedly ramping up.

We are being told by the pundits and those folks the media always quotes in their stories that corporate earnings are on the increase, that consumer spending is still holding firm, and that the market still looks good. They then tell us that the recovery is taking hold and heading forward. Yet they then rush to tell us that it is still too bad that this hasn't yet translated into new jobs, but (patting us on the head) comfort us by saying "don't worry, it will come."

Bullshit. The simple truth is that no matter what the talking heads or W's whores say, Corporate America is in a mode to take all the profits they can for now without hiring back anyone domestically. This isn't wrong, since these companies are accountable to the bottom line and Wall Street. But it does say something about their long-term confidence in the situation here in America.

Earnings are up because companies are plowing through their inventories, not incurring new labor costs, and are working their remaining staff more and more. And when they've squeezed the inventories and their remaining workers as much as they can, they'll do as these companies announcing layoffs are doing, take a long look ahead at the likely strength of consumer spending in a declining job market and do whatever they can to cut costs and stay competitive: they'll lay off their remaining workers and move that work overseas. Yet they aren't thinking of who will be able to buy their products here made by overseas labor if well-paying domestic jobs are disappearing.

Bush says he won't be satisfied until everyone who wants a job has one. What he isn't saying is that those jobs are not the jobs they had, or even well-paying jobs. What W won't tell voters is that the jobs we are losing now won't come back. What W won't tell voters is that the jobs that will be created over the next several years will be significantly lower-paying jobs than the jobs lost now. So we are looking at serious wage deflation and loss of disposable income in the coming years, without the government taking any affirmative action to create new industries and well-paying jobs to replace those that are lost, nor play hardball to keep these jobs here.

Moreover, this administration is not interested in holding corporations accountable for the $125 billion annually in welfare and tax breaks and havens they get while shipping jobs overseas. It is well past time for the talking heads to explain to us how things can be so swell if corporations as late as last month were planning on dumping another 117,000 workers, on top of the nearly three quarters of a million unemployed who lost their benefits in December and January.

It is also well past time for corporate welfare, tax breaks, and tax havens to not only be conditioned on being a good citizen here in the USA, but means tested as well. If we are told by the GOP that entitlements for individuals need to be means tested, then so does corporate welfare. Quite simply, why have corporate subsidies and welfare for any company that moves jobs overseas?

Steve :: 5:33 PM :: Comments (6) :: Digg It!