Tuesday , November 12 2019
Home / Michael D. Farren

Michael D. Farren

Articles by Michael D. Farren

Labor Market Shrugs Off Strikes, But the Blade Runner Economy Isn’t Here Yet

11 days ago

The October 2019 jobs report just released by the Bureau of Labor Statistics (BLS) shows a larger increase in net employment growth than anticipated. Some 128,000 jobs were added to the economy last month, compared the surveys of economists that expected the number to be around 85,000. Meanwhile, the job growth estimates for August and September were revised substantially upward by 51,000 and 44,000, bringing the three-month average net employment increase to a very healthy 176,000 jobs per month.
The low expectations for October’s jobs report were attributable to the recently-settled 40 day strike at General Motors by over 40,000 United Auto Workers members, which accounted for over 95 percent of striking workers in the BLS’s strike report. In fact, the strength of the labor market, in

Read More »

Ending the Economic Race to the Bottom: An Interstate Compact Is a Win-Win Solution to Subsidies

15 days ago

Michael Farren testified before the Utah State Legislature’s Economic Development and Workforce Services Interim Committee at its September 18th meeting in Salt Lake City, Utah. His presentation explained how an interstate compact could help end the wasteful practice of recruiting corporations to the state by providing targeted economic development incentives.
His presentation covered a brief history of targeted economic development subsidies (TEDS), described the core problems with TEDS (namely, that they don’t work, that they may actually slow local economic growth, and that they definitely lead to less national growth), and outlined why TEDS are still used despite these problems (because most nonacademic economic development research is a one-sided benefits-only analysis, and

Read More »

Michael Farren on the POTUS Channel

21 days ago

Michael D. Farren reviews Foxconn’s decision to not go through with constructing a manufacturing facility in Wisconsin, despite considerable tax breaks from state and local governments.

Read More »

Michael Farren WRVA Radio

21 days ago

Michael D. Farren explains how Virginia’s tax incentives to lure Amazon into building its HQ2 headquarters in Arlington will negatively affect Virginians.

Read More »

Comprehensive Jobless Rate Hits New All-Time Low

October 4, 2019

Most headlines today will trumpet the unemployment’s rate drop to the lowest level in 50 years (3.5 percent), but the comprehensive jobless rate (CJR), a more holistic measure of unemployment developed in Mercatus Center research, fell to the lowest level ever (6.3 percent).
The CJR is the most encompassing measure of joblessness, counting someone as unemployed if they simply say that they want to work, regardless of whether that person is actively pursuing employment or even available to start a job. As a result, it’s the highest valid estimate that any politician or pundit can claim as the “true” unemployment rate.
The comprehensive jobless rate isn’t intended to replace the official unemployment rates provided by the Bureau of Labor Statistics, but rather serve as complimentary

Read More »

Yet More Good News for American Workers

August 2, 2019

The monthly BLS jobs report released today was one more piece of good news in a long trend—the longest ever—of uplifting labor market statistics. The breakneck jobs growth of 2018 (with 225,000 jobs added per month on average) has slowed to a more moderate pace in 2019 (165,000 jobs added per month on average so far), but is still rising about twice as fast as needed to simply satisfy population growth.
Employers added 164,000 jobs in July, with most of the growth occurring in education and health services (50,000) and professional and business services (38,000). The headline unemployment rate held steady at 3.7 percent, but the labor force participation rate rose slightly to 63.0 percent as more workers entered the labor market. Average hourly wage growth also held steady at a rate of 3.2

Read More »

Quotable Quotes: Targeted Economic Development Subsidies Don’t Create Economic Growth

July 23, 2019

“You have to spend money to make money” is a common justification for economic development subsidies. Politicians and paid consultants argue that targeted economic development subsidies (TEDS) are a necessary investment in economic growth, but the academic research shows they rarely lead to widespread economic or community improvements.
Furthermore, TEDS have little to no influence on where a business chooses to locate or expand. Most economic development subsidies just don’t work.
Misspending of public resources on TEDS means that we miss out on real opportunities to assist economic growth, like by investing in public goods and critical public services or decreasing tax rates for all taxpayers. A business-friendly political environment and investment in local amenities, such as public

Read More »

US Economy Sprints Through the Finish Line

July 5, 2019

America received a belated birthday present, as the Bureau of Labor Statistics reported today that 224,000 jobs were added to the economy last month. This extended the longest continuous period of employment growth to match the now-longest period of economic expansion in U.S. history.
The headline unemployment rate marginally increased to 3.7 percent, and the comprehensive jobless rate—the highest that anyone can claim the “true” unemployment rate really is—slightly increased to 6.7 percent. But most economic statistics did not appreciably change from May’s jobs report.
This good news comes in spite of the recent signs of economic skittishness from President Trump’s trade wars. While some think tariffs stimulate American job growth by making products manufactured in foreign countries more

Read More »

Smooth Economic Sailing Hits Headwinds

June 7, 2019

The Bureau of Labor Statistics reported that businesses only created 75,000 new jobs in May, a far cry from April’s boisterous numbers. Furthermore, March and April’s employment gains were revised downward by 75,000 with the addition of new information. It’s possible that American businesses are finally having trouble sailing into the headwinds caused by President Trump’s trade wars.
That said, there were a few bright spots amidst the gathering clouds. The unemployment rate remained at 3.6 percent, a 50-year low. The comprehensive jobless rate—the highest that anyone can claim the “true” unemployment rate really is, also held steady at its lowest-ever value, 6.5 percent. And the number of people working part-time (for economic reasons) but wanting full-time employment fell by 299,000, an

Read More »

Springtime Surge in Jobs Growth

May 3, 2019

The average monthly job growth in the first four months of 2019 (205,000 per month) has been equivalent to the average monthly increase since employment growth restarted in earnest after the Great Recession (204,400 per month since January 2011, when steady and strong job growth began), suggesting that there’s little worry that the economy is slowing down after the financial market correction last fall. Meanwhile, the headline unemployment rate hit a nearly 50-year low at 3.6 percent—the number of unemployed active job-seekers fell by 387,000 (a 6.2 percent decline).
After an unexpectedly sharp dip in jobs growth in February (attributed in part to the federal government shutdown and winter storms), the labor market sprung back in March and April. The Bureau of Labor Statistics

Read More »