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New research out of Princeton shows that the poor suffer more pain than the rich. “People in households making less than $30,000 a year spend almost 20% of their time in moderate to severe pain, compared with less than 8% for those in households with income above $100,000 a year,” says economist Alan Krueger.

Another interesting finding was that people who experience pain watch more television than those who do not. People who hurt spend about 25% of their time watching TV while the non-afflicted spend only 16% of their time, according to the self-reported surveys used in the study.

James Surowiecki returns with a strong column on employment data in the January 21st edition of the New Yorker Magazine after a nearly month-long hiatus.

His always-insightful column takes on Wall Street’s obsession with economic data–despite the huge variance baked into the estimates. From his piece:

…the payroll report has a sampling error of as much as plus or minus a hundred thousand jobs (which means that, instead of gaining eighteen thousand jobs last month, we may have lost eighty-two thousand), while the household survey’s error margin is even bigger, at plus or minus four hundred thousand jobs. The payroll numbers are also subject to big Continue Reading »

The Writer’s Guild strike, already more than two weeks in progress, could be costing the Los Angeles economy more than $21 million each day, according to the non-profit group FilmL.A. The Los Angeles Times has a breakdown of the various costs associated with the estimate:

The estimate is based on the average number of employees on these shows, and their typical budgets and shooting cycles.

For example, a single episode of a drama costs about $3 million to produce, employs 300 people and takes eight days to shoot. An episode of a half-hour sitcom costs $1.5 million, employs an average of 88 employees and has a five-day shooting cycle.

Sitcoms were the first to take a hit because of the shorter lead times in writing them. During the first two weeks of the strike, filming for sitcoms outside of studio soundstages dropped nearly 50% compared with the same period a year earlier, according to FilmL.A. Activity for TV dramas has been virtually flat, while on-location reality TV shoots jumped 23% recently.

FilmL.A.’s estimate is conservative because it only takes into account jobs in the industry, not the scores of jobs at restaurants, hotels and other businesses that service Hollywood. The entertainment industry accounts for almost 7% of Los Angeles County’s $442-billion economy.

Nor does it factor in job losses from the feature film sector. Studios already have scripts in hand for their 2008 slates, so only a few feature films have delayed production, including Ron Howard’s “Angels & Demons” and Oliver Stone’s “Pinkville.”

It’s easy to poke holes in any cost-assessment, and the L.A. Times brings up a few good ones.

James “the genius” Surowiecki has a good piece in The New Yorker about strikes and why it is difficult to resolve them (read it here).

[Image from thepointmedia.com]

[Thanks to Nicholson Cartoons for the image.]

The income gap between black households and white households has widened over the past 30 years according to a recent study by the Brookings Institute, covered by the AP. The key statistic is below, from the AP story:

In 2004, a typical black family had an income that was only 58 percent of a typical white family’s. In 1974, median black incomes were 63 percent those of whites.

What’s driving this change? The empowerment of white women, whose salaries have increased an average of five-fold during the time period. White men didn’t improve their incomes significantly. Black men lost ground, but black women made up for the loss, the study says. You can download the study and come to your own conclusions from this site.

It’s important for policy makers to keep an eye on earnings disparities. All groups must be treated equitably and a widening income gap may suggest that there are government policies keeping people from reaching their full earning potential. It’s something to be mindful of.

(Thanks to the Mr.BrownShow for the image).

Nonfarm productivity increased at an annual rate of 4.9% in the third quarter, according to the Labor Department and covered in various news outlets. The growth outpaced the 3.3% gain economists had predicted.

So that’s a good thing for employers. Unit labor costs fell at an annual rate of 0.2% during the third quarter. (Namaste to Shannon Burns of Shannonburns.com for the cartoon.)

But it’s even better news for the Fed. A productivity increase means that the economy can grow without inflation. This good report may be the only thing that Ben Bernanke has as good news this week. The banks are still dealing with the credit crisis and oil is starting to nudge $100 a barrel. (Of course it’s still cheaper than Dasani bottled water. It sells for an average price of $1.12 per 20-ounce bottle at WalMart, according to the Container Recycling Institute. There are 3968 ounces in a barrel. Which translates out to $222.2 per barrel of Dasani. There is of course a bottle cost coming into play here.)

High oil prices used to mean recession for the U.S. economy. But there hasn’t been the type of economic hit one might expect from the ever-increasing oil prices. Why? My guess is that more-efficient cars play a role. But even more importantly, the U.S. economy has moved further away from a industrial society and toward an information and services-based economy. Don’t need oil to set that economy humming.

So although the high oil prices are grabbing headlines, I’m not sure it’s something Bernanke will have to lose sleep over.

Based on “Abortion: Prohibition or Prevention?” Time, October 29. Unfortunately, the map is not reproduced online.

If you look at the world abortion map published by Time, you would see a big red spot: Eastern Europe. It’s the only part of the world with 105 abortions per 100 births. Nowhere else are the statistics as freightening, and the next highest is East Asia, specifically China, with the number falling in half 51 per 100.

China has long had a one-child per family policy that might explain its high rates, but what about Eastern Europe? So what is going on there? My best guess is that contraception methods used in Eastern Europe are not good enough.

My experience suggests that the above statistics are not true for all the Eastern Europe, Belarus at least, would be an exception. Most of the the Eastern Europe and especially countries of the former Soviet Union, have not had a high use rate of birth control pills (BCP), until recently. And the lack of use of BCP and
substitution for other methods is what, I believe, mainly drives the abortion rate up.

Indeed, my recent research based on the data offered by Ministry of Statistics and Analysis of Republic of Belarus, suggests that since early 1990s the usage of BCP has increased by four times! That’s led to a decrease in abortion (now guess the number!), yes it is four times lower for the same period of time, thus reaching almost the same level as U.S. and U.K.

This I guess what the economist should call a pure substitution effect. Now why would the rest of Eastern Europe not use the BCP? Is it that they still have a myth that you will became fat and die from cancer if you use them? Or is it because abortions are provided free of charge, while the BCP are very costly (comparative to the salaries), and are about 20USD per month.

My take? Costs matter. Prove me wrong.

The U.S. Labor Department reports that the job market is hot, hot, hot, with the total number of new jobs added in October at 166,000. That’s the fastest labor market expansion in five years. Good news, certainly, for any soon-to-be graduates

Usually that would be good news for the economy too, but Wall Street didn’t seem to much care. The Dow Jones Industrial Average edged up just slightly Friday, not nearly enough to compensate for Thursday’s beat down. So what sticks out here? Well most experts seem to think the Labor Dept.’s numbers are a little high. They cite the anomalous increase in administrative jobs. Others point to the way the Department estimates new jobs from the number of new companies being created.

This argument seems especially salient to me. The number of employees needed to start a company has decreased dramatically thanks to new technology developments. You can start an Internet business today with just one person, for example. It may be time to update the way those estimates are made.

Oh yeah, then there’s this, excerpted from the NYT:

And a separate survey of households, also conducted by the Labor Department, presented a very different picture of the job market. It showed that fewer Americans over all were employed in October. The labor force shrank by 211,000 jobs, and 465,000 Americans said they were no longer working.