HOUSE_OVERSIGHT_020905.jpg
2.41 MB
Extraction Summary
3
People
5
Organizations
2
Locations
0
Events
1
Relationships
4
Quotes
Document Information
Type:
Presentation slides / economic analysis report
File Size:
2.41 MB
Summary
This document consists of two slides (pages 127-128) from a KPCB 'USA Inc.' presentation analyzing structural problems in the US labor force circa 2010. The text argues that healthcare costs, skills mismatches, and housing market immobility are barriers to hiring, while also noting that extended unemployment benefits have had a minor but statistically significant impact on unemployment rates. The slides cite research from Morgan Stanley (Richard Berner) and the Federal Reserve Board of San Francisco (Rob Valletta and Katherine Kuang). The document bears a 'HOUSE_OVERSIGHT' bates stamp.
People (3)
| Name | Role | Context |
|---|---|---|
| Richard Berner | Source/Analyst |
Cited as source from Morgan Stanley Research regarding US employment weakness.
|
| Rob Valletta | Author/Researcher |
Cited as author from Federal Reserve Board of San Francisco regarding extended unemployment benefits.
|
| Katherine Kuang | Author/Researcher |
Cited as author from Federal Reserve Board of San Francisco regarding extended unemployment benefits.
|
Organizations (5)
| Name | Type | Context |
|---|---|---|
| KPCB |
Publisher of the presentation slides.
|
|
| Morgan Stanley Research |
Source of data regarding structural problems in the labor force.
|
|
| Manpower Research |
Source of survey data regarding skills mismatch.
|
|
| Federal Reserve Board of San Francisco |
Institution associated with cited researchers Valletta and Kuang.
|
|
| USA Inc. |
The name of the presentation deck these slides belong to.
|
Locations (2)
| Location | Context |
|---|---|
|
Subject of the labor force analysis.
|
|
|
Location of the Federal Reserve Board mentioned.
|
Relationships (1)
Cited together as authors of 'Extended Unemployment and UI Benefits'
Key Quotes (4)
"Healthcare benefits = 8% of average total employee compensation; grew at 6.9% CAGR from 1998 to 2008 compared with 4.5% CAGR in salaries."Source
HOUSE_OVERSIGHT_020905.jpg
Quote #1
"One in four homeowners are “trapped” because they owe more than their houses are worth, so they cannot move to take another job"Source
HOUSE_OVERSIGHT_020905.jpg
Quote #2
"Our analyses suggest that extended UI benefits account for about 0.4 percentage point of the nearly 6 percentage point increase in the national unemployment rate over the past few years."Source
HOUSE_OVERSIGHT_020905.jpg
Quote #3
"the 0.4 percentage point increase in the unemployment rate represents about 600,000 potential workers who could become virtually unemployable if their reliance on UI benefits were to continue indefinitely."Source
HOUSE_OVERSIGHT_020905.jpg
Quote #4
Full Extracted Text
Complete text extracted from the document (2,420 characters)
Unemployment Benefits: Bad News—Structural Problems in Labor Force
Could Lead to Prolonged Duration/Increased Rate of Unemployment
Could Lead to Prolonged Duration/Increased Rate of Unemployment
• Structural Problems in USA Labor Force
- Healthcare costs may be a barrier to hiring for employers
• Healthcare benefits = 8% of average total employee compensation; grew at
6.9% CAGR from 1998 to 2008 compared with 4.5% CAGR in salaries.
• Healthcare benefits are fixed costs as they are paid on an annual per-worker
basis and do not vary with hours worked.
• As employers try to lower fixed costs to right-size to their reduced revenue
levels, layoffs are the only way to reduce fixed healthcare costs.
- Skills mismatch may be a barrier to hiring for employers
• A large portion of the long-term unemployed may lack requisite skills.
• 14% of firms reported difficulty filling positions due to the lack of suitable talent,
per 5/10 Manpower Research survey.
- Labor immobility resulting from the housing bust may be a barrier to hiring
• One in four homeowners are “trapped” because they owe more than their
houses are worth, so they cannot move to take another job – until they sell or
walk away.
- Healthcare costs may be a barrier to hiring for employers
• Healthcare benefits = 8% of average total employee compensation; grew at
6.9% CAGR from 1998 to 2008 compared with 4.5% CAGR in salaries.
• Healthcare benefits are fixed costs as they are paid on an annual per-worker
basis and do not vary with hours worked.
• As employers try to lower fixed costs to right-size to their reduced revenue
levels, layoffs are the only way to reduce fixed healthcare costs.
- Skills mismatch may be a barrier to hiring for employers
• A large portion of the long-term unemployed may lack requisite skills.
• 14% of firms reported difficulty filling positions due to the lack of suitable talent,
per 5/10 Manpower Research survey.
- Labor immobility resulting from the housing bust may be a barrier to hiring
• One in four homeowners are “trapped” because they owe more than their
houses are worth, so they cannot move to take another job – until they sell or
walk away.
KP
CB www.kpcb.com
Source: Richard Berner, “Why is US Employment So Weak” (7/23/10), Morgan Stanley Research.
USA Inc. | Income Statement Drilldown 127
CB www.kpcb.com
Source: Richard Berner, “Why is US Employment So Weak” (7/23/10), Morgan Stanley Research.
USA Inc. | Income Statement Drilldown 127
Unemployment Benefits: Bad News
Although economists have shown that extended availability of UI
[unemployment insurance] benefits will increase unemployment duration, the
effect in the latest downturn appears quite small compared with other
determinants of the unemployment rate. Our analyses suggest that extended
UI benefits account for about 0.4 percentage point of the nearly 6 percentage
point increase in the national unemployment rate over the past few years. It is
not surprising that the disincentive effects of UI would loom small in the midst
of the most severe labor market downturn since the Great Depression.
[unemployment insurance] benefits will increase unemployment duration, the
effect in the latest downturn appears quite small compared with other
determinants of the unemployment rate. Our analyses suggest that extended
UI benefits account for about 0.4 percentage point of the nearly 6 percentage
point increase in the national unemployment rate over the past few years. It is
not surprising that the disincentive effects of UI would loom small in the midst
of the most severe labor market downturn since the Great Depression.
Despite the relatively minor influence of extended UI, it is important to note that
the 0.4 percentage point increase in the unemployment rate represents about
600,000 potential workers who could become virtually unemployable if their
reliance on UI benefits were to continue indefinitely.
the 0.4 percentage point increase in the unemployment rate represents about
600,000 potential workers who could become virtually unemployable if their
reliance on UI benefits were to continue indefinitely.
Rob Valletta and Katherine Kuang, Federal Reserve Board of San Francisco
“Extended Unemployment and UI Benefits,” April 19, 2010.
“Extended Unemployment and UI Benefits,” April 19, 2010.
KP
CB www.kpcb.com
USA Inc. | Income Statement Drilldown 128
CB www.kpcb.com
USA Inc. | Income Statement Drilldown 128
HOUSE_OVERSIGHT_020905
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