How Will Job Market Be Impacted By Expiration Of Unemployment Benefits?

The holiday season could be tough for San Diegans looking for work. Federal benefits for the long-term unemployed expired this week, and it doesn't look like Congress will extend them in the near future. What impact will the expiration of benefits have on San Diego? Is it harder to find a job in San Diego than other parts of the nation? And, how might the local job market change in 2011?

Guests

David King, editor and founder of sandiegonewsroom.com

John Warren, editor and publisher of San Diego Voice & Viewpoint

David Rolland, editor of San Diego CityBeat

Read Transcript

GLORIA PENNER: The nation's unemployment rate rises to 9.8 percent with only 39000 jobs added in November. What does this mean for San Diego? I'm Gloria Penner, coming up on the Editors Roundtable, will San Diego's job market suffer along with the rest of the nation? Plus, major changes on the San Diego City Council. How will the new members deal with the budget agonies ahead? Plus Darryl Issa ascends to the chairmanship of a powerful house committee. Will San Diego benefit from its Congressman's new power? All that's next on the editors Roundtable. First the news.

I'm Gloria Penner, I'm joined by the Editors at the round table these days in San Diego. Today we'll examine the dismal employment picture nationally and how it might affect our region, and we'll look at the strengths and weaknesses of the new San Diego City Council and its ability to fix the bleeding budget. Also, will Darryl Issa's rising star lift San Diego as well? The editors with me today are David Rolland, editor of is San Diego City beat. Welcome back, David.

DAVID ROLLAND: Thanks, I'm a little closer to you physically this time. It's exciting.

GLORIA PENNER: Right. Now, no one out there knows what you mean. He's sitting closer. And David King is also with us.

DAVID KING: Good morning, Gloria.

GLORIA PENNER: [CHECK AUDIO].

DAVID KING: Pleased to be here.

GLORIA PENNER: And John Warren, editor of San Diego Voice and Viewpoint. John, also a pleasure to see you.

JOHN WARREN: Thank you, Gloria.

GLORIA PENNER: Our number is 1-888-895-5727. We have a lot of challenging subjects this morning, and I know you're gonna want to be part of it. Well, there was very sad news for the unemployed this week, the unemployment rate rose to 9.8 percent in November. Only 39000 nonfarm jobs were added. And unemployment benefits began to expire for two million out of work Americans. According to a November report by a job search machine, San Diego is the eighth worst place to find a job among 50 major metro areas. So David king, economists surveyed by Dow Jones news wires had directed that a hundred 44 thousand jobs would be added, and that the unemployment rate would stay the same at 9.6 percent. How worrisome are the late of the figures especially since they're so unexpected.

DAVID KING: Well, it shows what a grain of salt you should take from you get predictions from economists. I think it was harry Truman who said, the problem with economists is they got too many hands. They always say, well, on the one happened, and on the other hand. So it's a lot of estimation involved, when we talk about the broader economy here and what the population of the U.S. does, and how much people are gonna spend in the future, and I think that's the -- the restraint on consumer spending is what holds back business confidence and holds back the creation of jobs until consumers start spending again and there's an indication of consumer confidence and a willing to go out and buy the more high ticket items. You're not gonna see businesses willing to invest in new jobs, creating permanent new jobs. So the job figures are grossly disappointing. You know, hearing that you're at the end of a recession sounds like rosy news, but all it really means is things have stopped getting worse. It's kind of like Lindsey Lohan or Brittany spears, you have absolutely hit bottom. It doesn't mean you're back in good shape at this point. It just means we've stopped getting worse. And with the deposition of the recession that wee just gone through, it's like holding down a basketball, you generally expect it to rise back up and spring back out of the water. If you're holding a basketball down underwear, it's gonna rise up, spring out of the water. And with the depth of the recession that we had, you would expect it to be a rapid recovery because people haven't been spending and now all this pent up demand and inventories are depleted and now businesses will start spending again. We've don't have that because we've got the recession coupled with a melt down of our financial sector. And just the -- the loss in value of the net worth of homes causes people to just feel insecure economically and not spend money.

GLORIA PENNER: Well, David king, aside from the number of analogies that you gave me there, a pleasure to chew on some of them, I mean, that's a pretty comprehensive look at all of the -- many of the aspects that are causing the current job market. Let me ask our listeners whether they agree with your assessment. It's kind of hard not to, because you kind of covered all the territory. But truly, I mean, are you seeing us now in a situation where you simply don't expect a fast recovery? That that -- what was it? A basketball.

DAVID KING: Well, are that's the fear, that we can experience another decade like Japan or, you know, experience a decade going forward like Japan did in the 90s with just a constant recession or just a, you know, a growthless recovery. And we've gotta have, you know, before there's gonna be job creation, two percent growth in GDP isn't gonna did it, it's gotta be, like, 4 or 5 percent before you're gonna see additions to jobs. So positive economic numbers, those sound good, but they're not depend enough. Not nearly good enough to lead to job creation.

GLORIA PENNER: Okay. Our number is 1-888-895-5727. 895 KPBS. Are you anticipating we're going to have a long, slow -- maybe we can call it a recovery. I don't know, but we're in the gonna see anything perceptible for a very long time. And how is that going to affect your life? Are you gonna keep hanging on to your money or -- if you have any, or are you going to start spending just to stimulate the economy and do something good for your fellow man and woman? 1-888-895-5727. John Warren, let me have you reflect on some of the things that David had to say. I mean, he doesn't sound as though we're going to suddenly see things getting better.

JOHN WARREN: Well, it's much worse than David presented. We've known for some time that it would take at least 2 or 3 years for there to be any return of jobs in terms of availability. But I say it's much worse because we are not only looking at people who are being counted [CHECK AUDIO] there is the ethnic issue in terms of unemployment, for instance, with African Americans, unemployment hovers at about 16 percent as opposed to the figures that we're seeing. And then with the expiration of the unemployment insurance benefits, we see 3.3 million people as of the first of December without moneys that they might have had. And we've gotta remember that those benefits represented an extension to 99 weeks which historically is significant because in the past it's been 26 weeks in terms of unemployment, with maybe [CHECK AUDIO] so we're talking about a year and a half, and still no jobs and no money for people. And that makes the picture must worst.

THE COURT: David Rolland, that whole idea of people waking up on Christmas day because that's when a lot of these benefits are going to expire, and find out that they no longer have any income, period, end. No money to pay the rent, no money to buy food. All of these issues that, you know, one doesn't think about. Just not having any money. I believe that the White House predicted that 600000 more jobs would be lost by the end of next year if those unemployment benefits weren't extended. Of course, the White House wants them extended, so that's a pretty powerful argument. What's your sense of this?

DAVID ROLLAND: Well, 50 I'm still grappling with the difference between Lindsey Lohan and Brittany spears. Still having trouble with that. But no, it all comes down to what you do about it. I mean John's absolutely right. You gotta factor in all the under employment that's going on in addition to the unemployment. You know, I really -- I don't -- I'm very pessimistic, because I don't see the Democrats, the White House and the Democrats standing up for what they believe and really, really fighting politically over these -- the unemployment insurance benefits.

GLORIA PENNER: They're not fighting politically?

DAVID ROLLAND: It doesn't seem like they're having much success at all. You have -- their opposition seems to be only committed to making sure that people who make more than $250,000 a year continue to get tax breaks. Now, these are the people who -- the only people through this recession who -- whose lot in life has improved.

GLORIA PENNER: It has improved.

DAVID ROLLAND: The highest earning Americans earned even more. They gained in terms of wages throughout this recession. Nobody else has about the Republicans in Congress seem to be committed to helping them even more. And the Democrats can't seem to make that case to the American people. All they have to say is, look, we're fighting for the bottom 97 percent of you. The opposition party is fighting for the pop three percent. Of and they can't seem to make that case.

GLORIA PENNER: Well, are the Republicans have said, I'm just going to throw this in, have said that we would consider extending the unemployment benefits if you can find a place where that money will come from in government. In other words, they're pushing again for the smaller government. And this would give them a wedge to get some smaller government.

DAVID ROLLAND: But that is absolutely intellectually dishonest of them. They didn't say a word, first of all, the bush tax cuts came after the budget had a surplus. So they figured, okay, well, we can -- you know, we've got this money that we can return to everybody through these tax cuts. Then we had a horrible recession. So now -- I lost my train of thought.

GLORIA PENNER: That's all right. You know, in a way, I'm glad you lost your train of thought, because our phones are lighting up, and a lot of people want to get in on this conversation. Of so let's hear what Doug in allied garden has to say [CHECK AUDIO].

NEW SPEAKER: Great, thanks a lot. I'm a career counselor here in San Diego and happen to be teaching all but one stop career center staff and how to upgrade their skills to help the myriad of people who are unemployed, and thank goodness there's no economists on your show this morning because I'm really tired of their inaccurate predictions. We see it at the street level a lot quicker than -- the unemployment rate was gonna get worse. And I think you're right on talking about that we're gonna get in really deep trouble without an extension. But we're in trouble. There are so many people stressed out losing their benefits already. This is not news to people on the street helping people to try and find jobs when there are no jobs. So it's kind of refreshing to hear the reality, but it's gonna get worse.

GLORIA PENNER: Well, thank you very much, Doug, you mentioned something that dined of reminded me when you started talking about the people who are feeling it. Federal reserve chairman Ben Bernanke is worried about people who have been out of work for a long time because he says their skills tend to erode. So David king, how relevant is that to San Diego where we have a major sector in people that need skills like high-tech, BioMed, that kind of thing?

DAVID KING: Absolutely. And job retraining and -- there's been a couple of issues that make the U.S. less competitive, one of them is job retraining. And the other one is that people are locked into their homes because they owe more on their houses than they're worth so they can't move to places where there might be work. So everybody's stuck. Locally, is this more of an issue for San Diego than other parts of the country? I don't know that there's anything particular about San Diego's economy. Somehow overly dependent upon construction and home related jobs. And those don't translate well into other growing areas of the economy. The stability in the San Diego region comes from the number of Hawaii pay freeze imposed over the next do you mean of iary years about but in terms of the job retraining, that is an absolutely enormous issue for our country to face going forward. Of I can't say that it's in particularly a drain on San Diego's economy and he want to the extent of, you know, construction sector type jobs.

GLORIA PENNER: Okay, well, thank you David. And we really need to talk a lot bit more about the cuts in government, both state and local that might also drop down the numbers in the job market. But what we're gonna do is remind David Rolland that you had something he's forgotten, but he's remembered and we'll wring it back, and we'll bring that back right after the break. And that's when we're gonna take the rest of your calls as well. This is the Editors Roundtable, we're talking about the job market, I'm Gloria Penner, we'll be back in a moment.

This is the Editors Roundtable, I'm Gloria Penner. And we're back, we're talking about employment or unemployment, we're talking about the situation in San Diego, as well as nationally. And those at the table today are David Rolland from San Diego City beat, and John Warren from San Diego voice and viewpoint, and from San Diego News Room.com, David King. And David Rolland had a junior moment a few minutes ago and lost his train of thought, but he has it back now of so let's hear what that sparkling thought was, David.

DAVID ROLLAND: We all have our fingers crossed that I can get through it this time. Something must be seriously wrong when I forget how to criticize Republicans. It must mean I'm pretty lath erred up. No, my point was that the Republicans didn't say a word throughout the bush administration, which -- during which we saw an incredible growth in spending. But they didn't say a word. So now they're saying we need to find cuts in the budget in order to pay for these jobless benefits for people who are unemployed and you know, risking falling into the depths of poverty. The bush tax cuts represent the single largest impact on the deficit, on the federal deficit, and they're not coming out and say woogie need to find a place in the budget to pay for that.

GLORIA PENNER: But I thought, David King, I'll give you a chance to kind of defend the Republicans on this, I thought that the whole point of finding money elsewhere in the budget was so that we would not increase the deficit.

DAVID KING: Well, that is what both political parties will say. But you're not gonna see an extension to unemployment benefits until there's a compromise on the extension of the tax cuts. The emergency unemployment compensation that's out right there now, and all the 99 week people that have been unemployed for 99 weeks, two million of them will lose their employment benefits, that will not -- there will not be another extension creating another tier of employment compensation until there is an exception on the tax cuts and that's what senate Republicans have made clear. The rationale it creates economic uncertainty for people, and [CHECK AUDIO] investment if people don't want know what tax rates are going to be going forward, you can't crunch the numbers, you can't know what the rates are gonna be in accident year. There does need to be some certainty with it. Both parties need to be listening to the independents because what the independents voted in November was that you guys need to look at this deficit, a trillion here and a trillion there, and eventually it adds up to real money. That's what it ad[CHECK AUDIO] but both parties need to consider that going forward.

GLORIA PENNER: Okay, David, let's go back to the phones and hear what Mike from Fallbrook has to say. Mike, your on with the editors.

NEW SPEAKER: Good morning, thanks for taking my call. In the discussion, I noticed everybody, and no offense, but everybody that's discussing this has jobs am particularly on TV, reading the paper about the so called compromise on the up coming tax measure, the extend benefits for the richest one percent of Americans, about $100,000 a piece for people who are already hundred millionaires or billionaires, as a compromise to get the extended jobless benefits, yesterday on one of your shows on NPR you had a guy who said that well, I was unemployed, when my benefits ran out, I went out and got a job. And that's what these people should do. Okay, have you tried applying at McDonald's or any other place flipping hamburger? Well, let's see, I used to make 55 or $60,000 a year in my pretty good blue collar job. Now I'm gonna make $8 an hour. Do the math you can't stay in San Diego County making those kind of wages.

GLORIA PENNER: Okay. Thank you very much. Before you leave, Mike --

NEW SPEAKER: I didn't mention I'm a small business owner and have been here in 25 years, I'm down to 0 employees and that's because there's no money coming over the counter anymore.

GLORIA PENNER: Mike, two questions, what kind of business, and secondly, you said you can't afford to live in San Diego. Are you thinking about leaving.

NEW SPEAKER: Cabinets. Of and there is 0 work out there, which that would then lead me into the illegal immigrant debate, which -- folks who've come in and do not pay Social Security, do not pay income taxes and so on and so on. And it used to be oh, they're the people who do jobs Americans won't do. Oh, guess what? They're the people who are hanging your roof, doing your stucco, they're putting your tile in.

GLORIA PENNER: Okay. Thank you very much, Mike. I appreciate your sharing all of that with us. David King.

DAVID KING: That gentleman caller is reflective of San Diego and what the number of small businesses that are out there, and if you're a small business owner, and particularly, like, say for him, I even think he said he does cabinets of construction dries up, there is no work. Not as in there is les work. There is none. New homes are not going up. You can't get construction loans, you can't bahouses so there are no homes being constructed and that's it. That's the end of work. And if you've got skills that are like that, and your a small business owner, you can't just immediately reapply for a new job, I've been out on your own issue you're not the typical line employee that can pick up from a cubicle in one company to a cubicle in another cum. That's really reflective of someone who has just really hit the wall. And there's not an easy answer for someone like that.

GLORIA PENNER: Yawn.

JOHN WARREN: I would invite the cloak including comment in two parts, [CHECK AUDIO] nationally unemployment insurance benefits have been extended in the past as an emergency. An emergency matters don't go searching through the federal budget looking for dollars. And so that's an issue here. You know, David, you made -- David Rolland, you made the comment earlier that the Democrats didn't seem to be doing enough to be aggressive about this. Well, you gotta remember, in Washington there's a transition taking place now. Lamed up members are packing and moving, and the administration made it clear that they have not been able to rally even two Republican votes to consider bringing the unemployment extension to the emergency bill to the floor. That's why they're trying to look at tagging it onto this whole tax revitalization effort. And so the senate has already said, they're gonna block it. And that shows no concern for the local issue like the -- in terms of what's happening. When we have Imperial County with 29 percent of the people there are unemployed, and they're gonna be hard hit by that 3.3 million that's losing benefits.

GLORIA PENNER: That -- when you have that kind of unemployment figure, 29 percent, John, can you expect that there's going to be some public unrest? Some public disturbance?

JOHN WARREN: There historical -- yes, and it always has been, and we've been able to track it across the country in terms of where it comes up. The difference in the past, we have Cedar and other programs that put people to work. Now we're in a moral mentality that says we don't want to spend money on jobs, and let them go out there, it's almost let them eat cake as opposed to finding bread.

GLORIA PENNER: You know, what? I'm sorry we're not gonna be able to get to all of the phone calls that came in. But we've spent half the program on this, and we do have I couple of other subjects to go to. Of so let's move on, and I urge our listeners who have called in to please put your comment on our website, go to KPBS.org/Editors Roundtable. One word, and write your comment so we can see what it is that you have to say. And perhaps respond. Thanks so much. Appreciate that. That's KPBS.org/Editors Roundtable. So let's go on to our next subject which has to do with the local City Council, San Diego City Council.