Unemployment–coming soon
Unemployment…it’s no fun, and most of us have been there at some point. The word “unemployment,” like a lot words in economics, isn’t as straightforward as it looks.
Official tallies of unemployment statistics consider you unemployed only if you’re out of work and looking for it. That is to say, you’re in the “job market.”
In some cases, though, people without jobs aren’t really looking for work. Some get discouraged, and just drop out of the whole scene. Others simply get sick of working and decide to chill out for awhile. And, still others are “underemployed,” meaning they’ve taken jobs that are far below their professional capabilities; a rocket scientist working as a waiter would be an example.
You can, therefore, be unemployed, or underemployed, and not be considered “unemployed” in the statistical sense.
Which, in the U.S., isn’t a big deal, since unemployment has fallen below the structural level of five percent, which we always said was as low as it could ever go. Oops. I wish all mistakes were such happy ones.
As for the CNMI, unemployment rates are deceptive. Given that most labor is alien labor that must have a job to be here, our 5.5 percent unemployment rate doesn’t really tell much of the story.
I’ve never been one to fixate on unemployment rates; they’re overused by the media in reporting economic news, and are often presented as the Holy Grail of economic benchmarks.
But as for the CNMI, it’s obvious that unemployment is going to become a big issue.
In a lot of cases I’m seeing, the most employable people are leaving the island, and the pool of remaining labor is consequently less productive on average. You’d have to be stark raving nuts to contemplate opening a business here and hoping to find competent management. Much of the legitimate management talent got fed up with the Commonwealth, and has left for brighter venues. In a lot of cases, the hangers-on here are incompetents who can’t hack it in the states (“Washed up Americans,” as my friend Charles Reyes, Jr. puts it). And how many competent graduates of top universities are going to permanently settle in a place where they can’t even own a house? Not many. A few will have compelling reasons to be here, but, in general, it’s not a winning situation for most.
And, next wrinkle: without a pool of educated management talent, labor here will simply be unproductive. Menial jobs will be all we rate. Raw labor isn’t worth much if there’s no management to direct it.
The CNMI has created an economic environment in which productivity of labor will get lower every year for the foreseeable future, and the impact on the job market will be obvious. Unemployment? The Commonwealth is about to learn a very, very harsh lesson about the topic, and will only have itself to blame.
