Shadow Economy Shows Joblessness Less Than Meets U.S. Eye

[xchrom]

http://www.bloomberg.com/news/2013-03-20/shadow-economy-shows-joblessness-less-than-meets-u-s-eye.html


Sinan Sulaiman speaks to a resume professional at a National Career Fairs job fair in Arlington, Virginia, on Jan. 30, 2013.

When Kevin Kalmes received a foreclosure notice on her home after being unemployed for more than two years, she said she started selling the contents of her basement, figuring that “I can’t fit all this stuff in a Wal- Mart shopping cart.”

“Then I just kept the basement sale open, forever, without getting permits, because I didn’t sell it all,” said Kalmes, 61, who lives in Chicago. She then sold items for family, neighbors and friends and dubbed her never-ending sale the “Little Shop of Hoarders.”

Kalmes is among the 4.8 million unemployed Americans -- 40 percent of all those jobless -- who have been out of work for more than 27 weeks, even as the economy has been growing since June 2009 and the job market shows recent signs of healing. As her unemployment benefits have run out, she has entered the informal economy to make ends meet.

America’s shadow economy includes activities that are actually illicit -- prostitution and drug dealing -- and more benign jobs like working construction for a day for cash, or even the $2 a kid that Kalmes gets for walking neighborhood children to the bus. Added together, economists estimate $2 trillion could be involved.


Sam Hodgson/Bloomberg
The length and scale of such massive long-term unemployment is unprecedented in the United States. More than 30 percent of the unemployed have been out of work for half a year or more during every month since July 2009.

[backscatter712]

1. Sounds like what I've been doing.

While working through school, I have a nice little hobby business going putting together web sites for people - I can rake in a few hundred dollars a site.

[R. Daneel Olivaw]

2. It's not much of a shadow economy if you can't keep the roof over your head.

While overall unemployment fell to 7.7 percent last month, a rate that includes the underemployed was 14.3 percent.

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For her part, Kalmes won’t be able to save her house, which she’s trying to unload in a short sale. She just wants to bring her basement sale out of the shadows.

While I am happy that some are making money by any means possible, minus prostitution and drug dealing, they probably wouldn't mind getting in one year what some of the Wall Street robber barons make in one day.

Also the title of the piece, "Shadow Economy Shows Joblessness Less Than Meets U.S. Eye", doesn't really make much sense, and is apparently misleading, when underemployment stands at 14.3 percent.


What is Bloomberg trying to sell besides gaining readership?