At the end of the first week of July, the U.S. Department of Labor released its monthly jobs report. It showed continued weakness in employment and helped trigger a new wave of concern about the health of the U.S. economy. On July 20, a different "jobs" report was released this one by the CEO of Apple. In his company's second-quarter earnings announcement, Steve Jobs declared that Apple had surpassed expectations and posted record revenue and earnings. In addition to computers, Apple sold more than 8 million iPhones in the spring quarter and more than 3 million of its new iPad tablet devices. What's more, sales of the iPhone were up more than 60% from a year earlier.
The contrast between the two jobs reports is startling. So too is the commentary surrounding them. Understandably, the employment situation in the U.S. dominates public attitudes about the economic health of the country. Overall anxiety about economic prospects along with high government borrowing and private indebtedness casts a gray pall over Americans, so much so that our time is coming to rival the 1970s as a byword for gloom and pessimism. If you take a look around the globe, the American funk stands in sharp contrast to the dynamism of China, Brazil, India and many other countries. An optimism gap has opened up between the world of new players in the emerging economies and an old world of arthritic Europe together with a grumpy, out-of-sorts America.
And then there is the Steve Jobs report, which paints a radically different picture. Go into an Apple store and you will find 20-somethings, 30-somethings and even some 40-somethings snatching up gadgets that sell for hundreds or thousands of dollars, none of which is essential to daily life. Yes, you may need a mobile phone to get by, but you don't need an iPhone. A much cheaper LG handset will do the trick.
Apple is a source of endless commentary, not all of it favorable. The new iPhone 4 had an issue with dropped calls, which led to clips on YouTube parodying the company that have been watched millions of times. But think about that for a minute. If a flawed antenna on a luxury gadget attracts such a level of attention on social-networking sites that are themselves only a few years old and are the product of billions of dollars of venture capital, how does all that square with the sense of an economy in peril? And it's not just Apple that makes us ask such a question. Nintendo, the maker of the hugely popular Wii gaming systems, has sold 30 million units over the past three and a half years each costing a few hundred dollars, not including the many extras and games. Coach, a maker of high-end bags, has been recording stellar sales throughout the past two years.
Yet we are told almost daily that the American consumer is deleveraging, paring back, fleeing financial markets and confronting an uncertain future with diminished 401(k) plans or state pensions that are about to get whacked. And those warnings are not simply screeds voiced by pundits and politicians. They are true. Government data shows that Americans on aggregate are saving more (as much as 8% in recent months) and using less credit; surveys of business sentiment have found it to be lousy; and state pensions are indeed in sorry shape.
The conflicting pictures are a paradox. (Just as they are in Europe, by the way; the horror stories of Greek debt didn't preclude hordes of German tourists descending on the Aegean this summer, undoubtedly complaining about having to bail out Greece while spending thousands of euros there.) It would seem that both jobs reports couldn't simultaneously be true yet they are.
How come? Because we live in a world where the idea of a common, shared economic experience is largely a fiction. The two jobs reports can be completely contradictory and true because they represent the behavior and situation of radically different groups. The iPhone buyers are younger, the sort of folk who were neither burned by the stock-market blowout of 10 years ago nor hurt when the subprime-borrowing bubble burst in 2007-08. They may share an anxiety about the future with the millions of unemployed and underemployed, but they do not experience the same material hardships. They face an uncertain world, sure but they have incomes. And they represent a majority of the country.
The disruptions of the past few years have wrecked the lives of millions, and that is reflected in persistently high unemployment and sluggish growth. The inability of the American system to solve those problems dominates our public discussion, which reflects well on a society not content with uneven rewards. But the endless debate is also a national pathology, a relentless paying of attention to what is broken without sufficient appreciation for what is not. Each jobs report says something vital, and we do ourselves no service by ignoring either.