Tag Archives: trends

Gas Prices: Is the Sky Really the Limit?

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As we noted in our earlier post last week, there was another mix of good and potentially bad economic news. While the Dow Jones Industrial Average (DJIA) broke through 13,000 for the first time since May 2008, gas prices were projected to approach levels not seen since the spring of 2008. Although actual gas prices are still below even those of May 2011 when gas reached $4.02 per gallon, this is undoubtedly bad news in a nation that consumes more energy than any other nation on earth.

The factors driving this latest rise are the same as those that drive any market: supply and demand. Basically, gas prices are up because supplies are (at least potentially) down. In 2008, surging gas prices were the result of two factors: decreased supply due to U.S. refinery problems, and surging crude oil prices. While there was little to be done about the latter (other than consumer behavior decreasing demand), the U.S. was able to get refinery capacity back and, as the graph below shows, gas prices decreased steadily after that. As for the current rise in gas prices, the primary factor is once again supply, or more correctly, the fear of diminishing supply and a little international political intrigue that is driving that fear.

In recent days, Iran placed an oil embargo on France and Britain and considered extending that embargo to other European Countries. While this does not directly affect the United States, which has banned the import of Iranian Oil since the Hostage Crisis of 1979, it does introduce new buyers competing for oil normally purchased by the U.S. However, it is unlikely that a supply shortage will actually occur. For that to happen, Iran would have to stop supplying oil to the world market and, given that oil is Iran’s main source of income, it is doubtful that will happen.

We are interested in your thoughts on this. Did you know gas is actually less expensive now than it was in May 2011 or July 2008? Join the discussion below or let us know via Twitter or Facebook.

Rising Unemployment among Youth (Ages 16-24) in the OECD

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In last week’s post on the December 2011 unemployment numbers in the OECD, we showed how the total unemployment rate across the OECD has remained relatively stable in recent months, ending December 2010 at 8.2%; the same rate as in November 2010. While some countries—i.e., Germany and the United States—have seen a consistent decrease in unemployment since September 2011, the majority of states have not been so lucky: Spain, for example, ended 2010 with a shocking 22.8% unemployment rate, more than 8% higher than the country with the second highest unemployment rate (Ireland, with 14.5%).

What we did not discuss at the time, however, was the disproportionate impact the economic crisis has had on certain age groups. Today, we look at unemployment trends among the youth (ages 16-24); trends that are much more alarming than the overall unemployment trends.

The first chart, below, displays youth unemployment rates from January 2000 through December 2011 for the EA-17 (e.g., the 17 European Union member states that have adopted the Euro as their currency) and the EU-27 (e.g., all 27 European Union member states). From a low of around 15% unemployment at the start of the economic crisis in 2008, youth unemployment has grown to over 21% in 2011 with no sign of abating.

Source: Eurostat

The following chart uses the same Eurostat data, but looks at within-country trends over the past 4 years. We’ve also included the United States in this sample.

Note: The data labels represent the unemployment rates in Q3-2011.

 

Viewing the data in this way shows just how dire the situation is for younger job seekers in many countries. In Spain, the youth unemployment rate rose from an already high 24.6% in 2008 to 47.8% by the third quarter of 2011, more than twice as high as the total unemployment rate of 22.8%. A similar trend is seen in the other Southern European countries, including Italy (from 21.3% in 2008 to 28.2% in 2011), Greece (from 22.1% in 2008 to 45.8% in 2011), and Portugal (from 20.2% in 2008 to 29.9% in 2011).

As for the United States, the youth unemployment rate increased from 12.8% in 2008 to 17.5% in 2011; well below the EU-27 average of 21.6% in 2011, but close to double that of Germany (8.6%), Austria (7.3%), and the Netherlands (7.6%).

In short, it is important to keep different demographic age groups in mind as we evaluate economic trends. From this data, it is clear that the youth have been particularly affected by the Great Recession, and the recent economic gains (at least in the case of the United States) have done little to improve the situation of this group.

 

2012 Iowa Caucuses: Trends in Last Night’s Voting

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The Iowa caucuses have come and gone, and while we all know the big (?) winner of last night—Mitt Romney—we were left wondering about the underlying demographic and socio-economic trends from last night’s voting. Did one candidate dominate the youth vote? Did educational backgrounds affect one’s choice in candidate? And how about income?

Among the most interesting results found in MSNBC’s exit polling are the following:

  • Age: Ron Paul dominated the youth vote, receiving 48 percent of the votes among 17-29 year olds compared to 23 percent for Santorum and only 13 percent for Romney. Conversely, Romney received the most support among voters 65 and over with 33 percent, compared to 20 percent for Santorum and only 11 percent for Paul.
  • Education: The top three candidates received similar shares of the vote across the “more than a high school graduate” and “high school graduate or less” categories. Santorum received the highest share of votes from those in the “more than high school graduate” category with 26 percent, compared to 25 percent for Romney and 22 percent for Paul. Romney received the most votes from high school graduate or less with 22 percent versus Paul’s 20 percent and Santorum’s 19 percent.
  • Income: As with age, there were big swings in support depending on the voter’s total family income. Paul received the most support of voters with incomes under $50,000 with 31 percentcompared to Santorum’s 19 percent and Romney’s 16 percent. Santorum received the most votes in the $50,000-$99,999 category with 29 percent compared to Romney and Paul’s 21 percent. Finally, Romney received the most votes among those with incomes of $100,000 or more, with 36 percent compared to Santorum’s 24 percent and Paul’s 14 percent.
  • Ideology: The largest swings among the three top candidates were seen in voters’ political ideology. Among those self-identifying as “very conservative,” 35 percent supported Santorum with Romney (14 percent) and Paul (15 percent) trailing far behind. In contrast, Romney received the most support among “somewhat conservative” voters, with 32 percent compared to Paul’s 21 percent and Santorum’s 19 percent. Finally, Paul narrowly edged Romney among “moderate or liberal” voters with 40 percent of the vote compared to Romney’s 35 percent. (Santorum’s support among this group dropped to only 8 percent. 

In short, what we saw last night are large vote swings depending on one’s demographic and economic characteristics. Support varied the most depending on one’s age, income, and political ideology.