CHART: Big Corporate Jobs 1964 Vs. 2011

From Derek Thompson at the Atlantic...

The Post-Employee Economy

Fifty years ago, the four most valuable U.S. companies employed an average of 430,000 people with an average market cap of $180 billion. This year, the four largest U.S. companies employ an average 120,000 people with an average market cap of $334 billion. The titans of 2011 have twice the the value of their 1964 counterparts with a quarter of the employees.

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Comments

[LiberatedCitizen]

Thanks bj bill for NAFTA filthy pigs in our government sold their own people down the drain for a few pieces of silver. Remember obozo was going to re-negotiate that unfair trade agreement hahaha he not only didn't do that but he signed us up for some more job losses and put one of the big offendes Imelt in as a jobs czar. Worse he stimulates other countries with OUR tax dollars. He says drill baby drill to Brazil and Columbia and gives them our money to do it costing us jobs and driving up our prices. He's worse then carter I know I was around to see the damage that fool did but at least under carter people could earn a little interest on their savings the banks really bought themselves a good buy with obozo.

[LiberatedCitizen]

KARMA? American company stolen in China

http://www.theepochtimes.com/n2/china/american-stationary-giant-brought-to-its-knees-in-china-54204.html

[Cheyenne]

Fascinating chart. But does that chart account for the declining purchasing power of the dollar? In 1964, 1 dollar would fetch you 4 quarters made of 90% Ag and 10% Cu. To do that now will set you back $34 easy.

Profits are up in nominal terms only. But jobs? Yeah, definitely down. Funny the havoc debt-based currency wreaks.

[Exile]

According to the inflation calculator, prices rose 569.06% from 1967 to 2011; a $1 1967 item now costs $6.69. 1/6.69 x $334B = $50.1B market cap in inflation adjusted dollars. That is a 72% drop from 1967's 180B! Market cap per employee: 1967 = $418,605 v. 2011 = $417,500. I would say they are pretty much the same, now versus then.

I am not saying the economy is as healthy as it was in 1967, but I can see that sensational and misleading headlines are what keep the public from knowing the truth about important things. This is just one more example of how inflation distorts the public's perception of economic reality and causes them to make bad/incorrect decisions.

[Cheyenne]

Exile--

Beware using "inflation" calculators that are really CPI calculators. While CPI has long been gamed by bureaucrats to mask the real erosion in USD purchasing power, CPI and inflation underwent a formal divorce proceeding under Clinton, whose admin was responsible for nonsense like hedonic substitution. After 1999 or so, steaks going from $10 to $20 = 0.0% inflation because shoppers just bought $10 of hamburger. (Query what's to prevent iterative substitutions downwardly to $10 dog food?)

John Williams at shadowstats.com has made a career of debunking this and other fictions hiding within the CPI Trojan horse.

The other night I watched "Inside Job" and almost fell out of my chair when Paul Volcker said he was making $45K a year on Wall Street when he left for the Treasury in the late 1960's. Similarly, Yves Smith at nakedcapitalism had a recent post about the top 0.1% of income earners, noting that they made 2.7% (1/40the) of all income in 1974 and 12.3% (1/8th) today.

So while Main Street has been getting creamed with higher prices and lower real incomes for decades, the parasitic banking sector has gotten distended beyond all reality. Or not: pigs get fat, hogs get slaughtered.

[john]

MIT "TEPCOes" Its Billion Prices Project

http://www.zerohedge.com/article/mit-tepcoes-its-billion-prices-project

[snip]

If there was one thing TEPCO was consistent in during the entire Fukushima crisis (and will be for a long time), was its ability to simply "disappear" data that was not palatable for general consumption. Well, it only took MIT 6 months to "TEPCO" its Billion Price Project.

Note: I wasn't kidding about the BLS the other day regarding the Invisible Person! The BBP went the way of the 99ers after they took away the cape.....

[Exile]

Cheyenne:

You are absolutely right on the CPI understating the erosion of purchasing power. I admit I was lazy and didn't want to use shadowstats when the inflation calculator was easier. My bad. If I corrected my calculations using shadowstats measurement it would lower the $50.1B for current market cap in 1967 dollars. That would, in turn, lower the ratio of market cap:employees, and that would make the story's point (more value with less employees) even more dubious because it would say that market value per employee is actually _much less_ now than in 1967.

Given that realization, the point of the story would better be something like: why are we paying these CEO's outrageous compensation packages when their market cap per employee ratio is worse now than it was in 1967? That is the exact opposite point of the story as written.

I don't understand why the author thought the story was even meaningful. We don't know why these firms have less employees. Maybe they left for better paying jobs at smaller firms. He doesn't say. What is market cap / employee anyway? Is that a meaningful measurement of business performance? I guess it's a surrogate for profit per employee but it is colored by the PE ratio which seems an unwanted complication. I don't know.

[john]

Why MIT Is Not Willing To Unleash Real-Time, Dynamic-Purchasing Inventory Control Systems; Or The "Real" Reason For The Culling Of MIT's Billion Prices Project

http://www.zerohedge.com/article/why-mit-not-willing-unleash-real-time-dynamic-purchasing-inventory-control-systems-or-true-r

[snip]

However, if MIT continues to lie about why they are no longer making the data available, then this will be used to decrease competition and allow frontrunning by financiers as they alone are able to watch in real time pricing trends for specific industry, or even a specific business located in a small town near you.

The pricing efficiencies which should ultimately accrue to the benefit of all mankind will be captured by the oligarchs and select businesses willing to sign confidentiality agreements. We cannot allow this to happen. Long live the internet and the blogosphere because secrets cannot be kept long. Information should be free, or at least priced competitively!

[Something Polish]

Good news! There are Signs of Life:
http://www.eschatonblog.com/2011/04/optimism.html

"CNBC today:

Four Years Later, Housing Market Shows Signs of Life

WSJ, July 2009:

Signs of Life in the Housing Market

Marketwatch, April 2010:

Signs of life in the zombie housing market?

FT, Feb. 2009

US housing market shows signs of life

Bloomberg, March 2009:

Signs of Life from the Real Estate Market"

Quasi-related: I heard they turned another corner in Afghanistan. Huzzah!

http://www.theonion.com/articles/us-forces-take-over-key-afghan-city-that-will-be-r,19423/

[j r]

IBM is the oddball here, isn't it? Especially compared to the other hi-tech companies. Not that IBM is a really a hi-tech company anymore, more like a sweat shop with a few small areas of technology R&D.

Hopefully this means IBM is on the way to oblivion. Can't happen soon enough.

[HunterMoon]

AT&T's market cap in 1964 was nearly 1 Trillion dollars!?! I think your chart is wrong or your legend is wrong.