Not Enough Jobs

Republican candidates in the congressional elections of 1970 suffered badly from public dismay over a jobless rate that had just hit 5.6%. Yet in this year's campaign, with the rate also at 5.6%, unemployment has practically disappeared as a political issue. Only 13% of the likely voters queried in the latest TIME Poll conducted by Daniel Yankelovich Inc. listed it among their worries.

The paradox is easily explained: in 1970 joblessness was rising sharply; many who were employed felt that they too would be thrown out of work. But now the rate has dipped from a peak of 6.2% in May of 1971, soothing the nerves of those still working--and they outnumber the jobless almost 17 to one. It may be that Americans are growing used to a jobless rate that they would have found intolerable only a few years ago. To Presidential Assistant John D. Ehrlichman, unemployment is really a training problem, because joblessness is "down to teen-age blacks, welfare mothers and folks of that kind...people who can't hold jobs."

While training is surely desirable, Ehrlichman otherwise is wrong. Jobless rates are indeed especially high among blacks and other minorities (9.7%), and teen-agers (16.9%), but the rates have also risen in every other category as well since the last time Richard Nixon ran for President. (The overall rate in the late summer of 1968 was 3.5%.) Some of the biggest increases in the past four years have occurred among whites (from 3.2% to 5.1%), white-collar workers (2% to 3.5%), blue-collar workers (4.2% to 6.5%) and heads of households(1.8% to 3.3%).

Members of TIME'S Board of Economists predict a record $110 billion increase in national output next year, but most of them believe that the nation's overall jobless rate will come down only to an average of 5%. Nixon Adviser Alan Greenspan adds that he expects the rate to range between 41% to 51% for several years. The Government's traditional "full employment" target is 4%; the irreducible jobless rate, composed of people moving between jobs and those only marginally employable, is a matter of guesswork. The mid-point of the experts' guesses is a shade more than 21%.

Why is unemployment so intractable? One reason is that more and more people are competing for jobs. This year the civilian labor force will grow from 85.7 million to 87.2 million. During the 1970 recession, many blacks, women, youths and people at or nearing retirement age got so discouraged that they gave up looking for work. With the economy picking up, they are now seeking jobs again. In addition, productivity is rising fast, partly as a delayed result of cost-cutting programs started by companies during the 1970 recession. Basically, that development is good, but it reduces employers' hiring needs. There is also an involved argument that joblessness is not helping to contain inflation as much as it once did, partly because the women, teen-agers and blacks who are most affected usually are not the unionized workers who push for and win big wage increases. In other words, so the argument runs, if the nation wishes to bring inflation down to, say, 3% or less per year, it must settle for more unemployment than in the past.

It is also true that unemployment today is somewhat less painful than in the past. In 1965 only 60% of jobless men over 24 got unemployment compensation; in 1970 the proportion rose to 77%, and it is even higher now. People who cannot collect unemployment compensation find it easier than before to qualify for welfare. Indeed, many of the unemployed feel no compulsion to take just any job that is offered.

Safe Stimulus. For all that, the U.S. can neither downplay nor ignore unemployment. What can be done about it? Robert Nathan, a Democratic member of TIME'S Board of Economists, argues that the Government could safely spend more to stimulate the economy, relying on rising productivity and tough controls to hold inflation down. Republicans reply that controls are ineffective against the type of inflation that results from excess demand fueled by giant budget deficits. But Washington could make at least one move to distribute the burden of unemployment more evenly. It could crack down harder on job discrimination based on race, sex or age.

Such discrimination is illegal, but if even a few of the bitter stories told by the unemployed are true, it persists widely. Ronald Daniels, a 24-year-old black graduate of Michigan State, has found only temporary jobs pumping gas and working in a liquor store. He lost the latter job, he says, when the store manager gave him the flimsy excuse that "he did not think I was enjoying the job. I felt that whether or not I enjoyed it was beside the point, but I got fired." Older workers are especially discouraged. Lena Moore, a 53-year-old secretary in Macon, Ga., who lost her last job after being hospitalized for hepatitis, asks: "Will you tell me why when you get over 30 and apply for a job, they circle your age in red and you never hear from them again? By golly, after you get to be my age, it does not matter what you can do." There is no political, economic or legal excuse for such discrimination. But even if it were ended, finding the best level at which to strike the trade-off between unemployment and inflation would be a problem that would continue to bedevil economists of every persuasion.

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