I’m Heidi Shierholz, Chief Economist of the U.S. Department of Labor (as well as bicyclist and beekeeper)—ask me anything!
Hi, I’m Heidi Shierholz, Chief Economist at the U.S. Department of Labor.
I’ve spent all morning advising Secretary Tom Perez for his interviews about today’s jobs report. Now that I’m on my lunch break, I can tackle your questions on economics, labor statistics, and my work here at the Department of Labor. Ask me anything!
A little bit about me:
I’ve been Chief Economist at Labor for a little over two months. As Chief Economist, I’m not in charge of any particular agency, but I provide advice to the secretary as well as others in the department on a broad range of topics. Since I started two months ago, it’s been a whirlwind. There are so many projects the department is working on. Here are a few:
Executive Orders on overtime and minimum wage for federal contractors
Economic analysis of persons with disabilities and Latinos.
The Secretary and I are particularly focused on the issue of paid family leave, where the U.S. is the only advanced country in the world that does not require any paid maternity leave.
Today’s Jobs Report from the Bureau of Labor Statistics showed the unemployment rate at 5.8 percent—the lowest since July 2008—and 214,000 jobs created in October—the ninth consecutive month of job gains over 200,000. We still have a long way to go, but this marks 56 consecutive months of private-sector job creation, with over 10.6 million private-sector jobs created since the end of the recession.
In my free time (when I have free time) I tend to my beehives and commute to work when weather permits on a steel-framed bicycle.
Proof it’s me: https://twitter.com/USDOL/status/530763254390611968 Also here’s a pic of my bees: https://twitter.com/hshierholz/status/530401333220999169
Update: I have to go with the secretary to a few meetings, but will be back to answer some more questions around 3pm ET
Update 2: I'm back and ready to answer a few more questions!
Update 3: Ok, Reddit! That's all the time I have for today. Thanks for all of your questions and I hope you'll have me again. P.S. some of you have some hilariously weird usernames!
There are some who say that paid leave would be an unmanageable burden for businesses. But that hasn't been the experience for US companies that provide paid leave and it hasn't been the case for those companies overseas that have more generous paid leave policies. "A survey of 253 employers affected by California's paid family leave initiative found that the vast majority -- over ninety percent -- reported either positive or no noticeable effect on profitability, turnover, and morale." Learn more here: http://www.whitehouse.gov/sites/default/files/docs/leave_report_final.pdf
But that hasn't been the experience for US companies that provide paid leave
devil's GOP's advocate here, so.. here goes)
"Firstly, isn't there a sampling bias there?
Even if not, surely that is enough evidence that companies that can provide paid family leave will do so, voluntarily! This is nothing but the Democrat's usual intrusion into the personal freedoms of government, and over-regulation. We don't need a law.
If it makes good economic sense, then the administration should make that case to the relevant businesses. They should make public, the tools and techniques that they('ve) use(d) to calculate the cost-benefit impact to a business (or a class of business/sector of the economy)... and let the business owners/company directors use the same tools, with their own unique numbers, and data... to arrive at a conclusion for themselves"
Thanks for playing! Many businesses do take the “high road,” and they find treating their employees well is actually good for business. The Secretary highlights Costco and Market Basket as examples all the time. But there is a role for government to set minimum labor standards. There are large disparities in access to paid leave, e.g. access is particularly low among low-wage workers.
Do you think the decline the labor force participation rate is structural or cyclical?
The good news is that the labor force participation rate has been stable for the last year. But the decline from 2008-2013 was due to both structural factors (e.g., baby boomers hitting retirement age, increasing college enrollment of young people) and cyclical factors (people dropping out of the labor force, or never entering, because of weakened job opportunities during and in the aftermath of the Great Recession).
Is there some sort of "breaking point" between rising college tuition costs vs. entry level job salaries?
Is it going to get worse for recent college grads to be higher in debt and struggling to find a job that can help relieve that debt?
I am not a recent college grad, I am lucky enough to have a stable job. But if I ever have children and tuition keeps rising, what incentive is for me to have them study in the US knowing the amount of debt I will incur for them to end up being a food blogger?
On average, college still makes good financial sense -- increased income after college make up for the costs of college. But college isn't the answer for everyone, and going forward there will be lots of opportunities for workers with more than a high school diploma but no college degree. That's why the department is expanding capacity at community colleges, growing apprenticeship programs, and providing multiple paths for people to learn while they earn and advance their careers.
Is there any discussion among the wonks inside the department about sci-fi or near-sci-fi scenarios of dealing with most jobs being obsoleted by technology? What kinds of contingencies are being discussed for such trends? Also, does everyone there brown-bag or are there particular economist-favorited restaurants?
Economists are typically horrible at predicting productivity growth. Some say it is going to massively decelerate and that will hurt economic growth, others say it will massively accelerate and the robots will take all our jobs. Historically, productivity has grown around 1% or 2% a year -- my guess is that going forward we can probably expect productivity growth along those lines.
If unionized fast food workers are successful in achieving $15/hour wages, what do you think will be the economic impact? Would companies try to automate those jobs? Would we see a rise in inflation as prices go up to maintain margins?
Historically increases in the minimum wage have caused little to no significant job loss (meaning employers haven't turned to robots to replace low wage workers when the minimum wage has been increased in the past), and very small increases in prices. The bottom line is that the purchasing power of the national minimum wage is more than 20% below where it was 40 years ago and it's time to give these workers a raise.
Are you unconcerned that the costs for automation have drastically gone down? Because there are a lot of unemployed auto workers who learned a harsh lesson about automation.
Since February 2010, the auto industry (manufacturing plus retail sales) has created 465,000 jobs, a stark turnaround for an industry hit hard by the Great Recession. Certainly technology has been changing the workforce since tractors replaced horses on the farm, and change is always tough when it happens to you. So even as we invest in the future of the auto industry, we can also make investments in community colleges and trade schools to make sure people can get the right skills for available jobs.
Similar to those without a disability, education matters. For instance, over half of persons with disabilities who have a bachelor's degree or higher are employed, compared to only 30% for those with only a high school diploma. There is a lot of work to do to provide opportunities for anyone who wants to work regardless of disability status. I recently wrote a blog post with Kathy Martinez, the assistant secretary of labor for disability employment policy, highlighting department policies for reducing barriers to work here: http://social.dol.gov/blog/expect-employ-empower-with-data/
Why are you not answering all relevant questions?
I'm trying, i'm trying, i'm a slow typer
How many jobs have you worked?
My first job was detasseling corn in the fields of iowa as a middle-schooler. It all gets nerdier from there. I was a research assistant in college and graduate school, i taught calculus and statistics here and there, after graduate school i was a economics professor at the University of Toronto, then i worked as an economist at the Economic Policy Institute here in DC and now I'm enjoying life at DOL.
Where in Iowa? I'm originally from Ankeny and my first job was also detasseling corn in middle school.
Ames High aims high!
How much honey do you get from your bee's?
We started keeping bees summer of 2013 and all, every last one, of the bees died last winter. :( We got new bees this spring and they look strong but we are not taking any honey from them until they make it through a winter. Any advice on how to help them through the next polar vortex?
There are many reports saying that a large portion of the jobs created are low-level service jobs. Is this worrying, or is it a symptom of our country moving from a manufacturing-based economy to a service-based economy?
Typically what you see in a recession is the disproportionate loss of low wage jobs, and what you see at a time like this -- when we are adding jobs but slack remains -- is disproportionate growth in low wage jobs. But if you look back at the 56 months of consecutive private sector job growth we're experiencing, we see growth across all sectors (with the exception of government, which has lost jobs).
What kind of hives are you running? I'm a Warre man myself.
I have two langstroth hives in my backyard, i'm still a newbee. But I’ve been wanting to add a top-bar hive, what do you think?
Top bar is fun because you can interact with the bees a lot more. They are also MUCH easier to build yourself. I like Warre because the "add boxes at the bottom" style mimics the bee's natural tendancies. Down side is production suffers.
Edit: plug for /r/beekeeping.
Will definitely checkout the subreddit. Thanks for the advice!
I work at a 3PL warehouse as a computer programmer. 3 out of 4 of the workers at the warehouse work on the line, packing boxes, shipping, doing light assembly. All of these workers are supplied by an employment agency which I assume gets a few dollars per hour of their pay. The warehouse does this because of labor laws that apply to direct employees. They need to hire and layoff people quickly to meet their demand for the week. The point is the workers would earn more if the employer could employ them directly and not use the agency.
Should workers be allowed to sign a contract that enables an employer to be able to lay a worker off quickly and without hassle in exchange for higher pay?
We don’t have a lot of data about contract and contingent workers, so this is certainly an area for future research. The President’s budget for 2015 includes funding for BLS to do a supplement to the Current Population Survey on contingent workers.
My town recently had a minimum wage increase that lost. There was a lot of discussion about how the increase was too much too fast (12/hr to take in effect in 90 days). Or how for many workers there would be a net loss due to the inability to get benefits. Is a minimum wage increase good or bad? And what would be a reasonable time frame for scaling it up in the future. Thank you.
Typically minimum wage increases happen in stages -- for example the last national minimum wage increased from 5.15 to 7.25 in three steps over three years. I think that kind of phase-in is a reasonable approach.
Today’s Jobs Report from the Bureau of Labor Statistics showed the unemployment rate at 5.8 percent.. The 5.8% number is only one of several numbers provided in that report, correct? The same report shows also shows a much higher rate with other qualifyers right? What is the reasoning for the choice for providing that rate and not the "others" as well. I hope this makes any sense at all
There is no one number that can capture the strength or weakness of something as complicated as the US labor market. BLS provides 6 different measures of labor underutilization, the official unemployment rate is only one of them. But all of them have been trending down over the last 4 years. BLS has an interesting explainer on this: http://www.bls.gov/opub/btn/volume-3/trends-in-unemployment-and-other-labor-market-difficulties.htm
Is Yellen your home girl?
Also, what do you think the impact would be if the fed rate increased on the unemployment rate (if any)?
The best moment ever was when i heard nobel prize winning economist George Akerlof referred to as "Janet Yellen's husband".
Hey there. I saw on your wikipedia page that you graduated with a mathematics degree from Grinnell College. Do you utilizes any of the concepts from that degree in your current job? Or is it more from your advanced degrees. Any current hobbies involving math? Thanks for taking your time to answer these questions!
At the end of every meal everyone hands me the bill to figure out the tip. But i just pull out the calculator on my phone
How many colonies? What do you use for smoke- twine, pine needles, etc?
two colonies, i use pet-bedding for smoke, what do you use?
Have you done any long-distance touring bicycle trips? If so, where!?
Only RAGBRAI (Register's Annual Great Bicycle Ride Across Iowa). I've done it 10 times, the last time i did it was in 2012, it was over 100 degrees the entire time
Can you explain the pros and cons of raising the minimum wage in Illinois to $10?
Roughly 1.4 million workers would get a raise if the minimum wage were increased in Illinois to $10. As i said above, the evidence on the economic effects on minimum wage increases shows that this would lead to little or no significant job loss. For more information, see http://www.whitehouse.gov/sites/default/files/docs/final_min_wage_slides_-_no_embargo.pdf
How do you counter arguments that many of the statistics used by the DoL are manipulated by either political party to suit their needs for political power?
Also, how'd you get started with the DoL?
We have the best statistical agencies in the world -- I have utmost confidence in the career, non-political employees at BLS. They are completely open about their methodology and safeguards in place to ensure the quality of the data.
I worked at BLS as a statistician in the mid-1990s, now back at DOL as Chief Economist after a long break
Thanks for doing this AMA. I currently live in South Dakota where we just passed a measure raising the minimum wage to $8.50/hour and requiring it to be annually adjusted by any increase in the cost of living based on the Consumer Price Index.
Do you think such an annual adjustment is viable as a component of the federal minimum wage? If so, what do you think would be the ideal value to set it to, knowing that it would keep pace with the cost of living?
Absolutely. Currently at the national level minimum wage workers have to literally wait for an act of congress to get a raise. Tying it to inflation would make increases stable and predictable for everyone, employers and employees.
How do you explain the economy doing well and employment growing while federal expenditures grow at only 1%? Obama and democrats told us that austerity budgets slow the economy. Yet federal spending is up only 1% in last year, similar small increases the last few years ( because of republicans, no? ) and the economy is growing at 3 to 4%.
The economy is improving despite the drag from public sector cuts since 2010, not because of it. State and local governments have shed over 500,000 jobs since the end of the recession in 2009—more than half of that in local government education which is mostly public K-12. Not only is this bad for those people who lost jobs, and businesses in the communities where they lived and shopped, but it’s short-sighted for us to short-change the education of our future generation.
Is there any economic argument against paid family leave? If yes, what is the argument? If no, why do you think it has taken so long for the US to catch up to other well-established countries?
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