Thursday, June 05, 2008

'There's Work Out There, But It Pays Less'

From the Modesto Bee:

This time last year, Ernesto Dias, 31, of Modesto was framing houses in Merced. By autumn, he and his co-workers realized that work was slowing and it wasn't just a seasonal shift. "The supervisors weren't talking about the next job because there wasn't a next job," Dias said.

He hasn't swung a hammer in eight months. After being out of work for two months, he started looking for nonconstruction work. A friend helped him get a part-time job washing dishes at night. His family was barely making it on his minimum-wage salary, so he took a second part-time job with a landscaping company. "I still don't make as much as I did in construction," Dias said. "My friends are going through the same thing. There's work out there, but it pays less, so you have to work more."

Farm labor contractor Jose Flores of Salida can attest to that. He supplies workers to many Central Valley farmers. "Most of them started working in the agricultural fields. They stayed (in the United States) and went for better-paying jobs. Now, they're coming back to their roots," he said. A few years ago, farmers watched their pears and apricots shrivel and drop from the trees because growers couldn't find enough workers to harvest their crops. "This year, we have plenty of labor. I wish I could hire more so they could have a job," Flores said.


smf said...

And here we have one reason why unemployment numbers don't look so bleak.

These people were never really counted in the first place when they went into construction.

Thruthfully, it was well-known prior to the bubble that there was a lack of construction workers, so when the bubble came it was logical to go with illegal labor.

Frank Jewett said...

I met a newer agent today who spent a decade selling high tech. Realtors are another reason for the deceptively low unemployment rate, even though the majority of them aren't making a decent income.

Jacob said...

Yea, realtors or anyone that only gets paid by commission doesn't get counted, contract workers, self employed workers, illegal workers.

There are a whole mess of people either making no money or considerably less and they are not reflected in the unemployement numbers.

But they will be counted when we see more and more sagging profits or expanding losses from retail businesses and restaurants.

Diggin Deeper said...

"But they will be counted when we see more and more sagging profits or expanding losses from retail businesses and restaurants"

Good observation!

The job numbers are basically a joke. Those who've quit looking are conveniently left out. Jobs are created and deleted ficticiously through the birth/death model which guesses at how many new businesses were created against how many businesses failed or retired over the period. Thus, one adds or subtracts jobs attached to those businesses. This data goes both ways, but it's an easy one to fudge if you need the figures to come better than expected.

At best the jobs data is more a guide then a true picture of the jobs situation at hand. I've read some reports that place actual jobless in the US at over 10%. While I'm not so sure, I'm not one to believe it's 5.5% as reported.

The real problem are stagnant and/or falling wages. With inflation running as high as it is, a .03 monthly rise in wages is basically going in reverse.

Jacob said...

Yea that's true also. If we lose 1 $100k job and replace it with a $8hr Wal-Mart job that wouldn't be reflected in the job numbers.

luca said...

oil up 9% today.,.,,. doom and gloom on wall street.

I am looking at a Carmichael home that sold for $550k in the boom it is $299k REO- fully rehabbed etc, but someone robbed the place stole appliances- copper piping and even the A/C. 2100 square feet. Off Winding way. I am going to low ball the heck out of it.

Kinda starting to think though- if I just wait 6 months we may have even better opportunities.

Patient Renter said...

it may pay less, but at least their is work.

wannabuy said...

The job numbers are basically a joke.

Yep. Close to 250k jobs assumed in via the birth/death model. As others have noted already, you see it first at discretionary retail (e.g., restaurants).

I just blogged my LA experience on looking at restaurants for our 1st anniversary dinner. We're not spending *that* much, but its sad that we could negotiate one week before the meal...

Got Popcorn?

norcaljeff said...

Should these people be any different than the tech workers who replaced their $100K jobs with $50K jobs? History has a way of repeating itself...

Hangtown said...

Hey Luca:

Real Estate is Over. Go home for a couple of years.