Oct

31

Jobs Data, from Bill Rafter

October 31, 2013 |

 For those of you interested in jobs data, this chart might be of interest.

The red line is very important, showing a 2 percent increase. Ceteris paribus the 2013 payroll tax receipts should average 2 percent above 2012. However as time has progressed, the government has received less and less of this increase, and the current receipts growths are running negative to the prior year despite the increase in rate. This is the Laffer Curve at work.

As of January 2014 the YOY growth will use as its base the tax-increased 2013 data, which should be interesting.


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  1. Craig on November 2, 2013 7:10 am

    Many economic indicators have slowed in the second half, so that may be part of the problem, as well. 2014’s first half would continue to slow if we follow the average of previous cycles comparing from entry into the previous recession. 6-7 years after a global recession, we always have problems. If we follow another global recession path, the worsening continues into 2016.

    Here’s a chart showing tax receipts have averaged around 18.1 percent of GDP despite the various tax rates. Maybe an economy is only capable of giving a certain amount. The percentage could differ depending on how a country calculates GDP. (The US has been using a really low deflator to make GDP higher in recent years, so that could be one of the reasons for being lower than 18.1% now.)

    http://www.heritage.org/federalbudget/current-tax-receipts

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