Chaos! It's the word used to describe the supply chain problem reflected in the U.S. Coast Guard video above. Watch the video. Taken last month in the height of the shipping containers waiting...and waiting...and waiting to get a slot at the Port of Los Angeles.
The latest data from the Port of Los Angeles and from the Marine Exchange of Southern California confirms that there has been no real let-up in the historic container-ship traffic jam off California’s coast. Since the beginning of this year 25 container ships were at berth in Los Angeles and Long Beach, 30+ container ships were at anchorage with a record of 40 container ships at anchor on February 1.
The term Extended Economic Distortion was introduced in these posts on May 2, 2020. Perhaps no situation illustrates what that means more than the shipping chaos. And we'll explore that further after noting the confusing (chaotic?) continuing reports on employment in the press flooding the headlines because...you guessed it...those reporting it are sitting on their behinds simply rewriting news releases instead of reporting.
The U.S. has an available workforce of 160± million, 83± million of whom are male, and 77 million of whom are female. Of those, 18± million people are receiving some sort of jobless aid - they are termed "the underutilized."
That doesn't count the folks who aren't getting jobless aid. Do we call them "the unutilized?"
The news Thursday told us in the week ended February 27, 745,000± people not currently on the roles of the underutilized filed claims for Unemployment, up 9,000 from the previous week. Some stories even tell us that about 437,000 others who filed claims for Pandemic Unemployment Assistance, a program for business owners, self-employed workers, independent contractors, and those with a limited work history who are out of business or have significantly reduced their services as a direct result of the pandemic.
If you skim the articles you might get the impression that the 745,000± newly unemployed are up (or down) a little from the norm. Actually that is three times the "normal" claimants. And that's after the pandemic settled down a bit.
What's fascinating is the graphics. Compare these two charts:
It is quite obvious that the graph used to show initial claims has been "adjusted" to reflect the 7 million claims filed in March of 2020. That makes it possible to minimize the difference between early 2020 and early 2021. Again, the number of claims is three times those of early 2020.
Because it was the beginning of this month, Friday we did get information on the monthly employment statistics including in-depth numbers which can be compared as follows:
Looking at the first line, we should be getting a hint about the problem - three times as many folks find themselves unemployed 15 weeks or longer. At the bottom line, we learn we have have about 11.6 million in employment "labor underutilization"
Not on this chart, we now know we have at least another 6.4 million in contract "labor underutilization."
Or, to put it another way, at least 11% of the labor force is effectively out-of-work as we generally understand the term.
All of which brings us back to the Port of Los Angeles which initially saw a decline in imports noted here previously, but now we must have a chart that can help us visualize the chaos in our supply chain:
There is no question that the large Covid finanicial relief packages previously approved by Congress contributed to this retail "buying spree." Now it appears another large package will be on its way.
As we move towards 70% vaccination, how is this going to play out? We noted here on May 7, 2020, Expect a consumer-based Extended Economic Distortion after the Great Economic Lockdown. What will an Extended Economic Distortion look like? We don't know. Maybe it will be an economy "at anchor" with nowhere to go.