U.S. Labor Force Declines by 720K

The big story out of the October household survey was the decline by 720,000 in the headline labor force, which largely reflected the loss of longer-term unemployed into the broader U-6 unemployment measure.

In fact, since January 2009, the U.S. Labor Force has only grown by 607,000. Yet, over the same period, 11,034,000 persons have been removed from the labor force (see chart above). Once removed, such are neither counted as employed nor unemployed, each amounting to the equivalent of zero-fifths of a person in terms of modern governmental accounting.

In Manipulation 101: The Real Unemployment Rate, we learned that as the size of the labor force erodes, the unemployment rate artificially declines. So let’s recall how the unemployment rate is calculated. The unemployment rate is calculated by dividing the number of unemployed persons by the size of the labor force:

Thus, the official unemployment rate of 7.3%, as reported by the Bureau of Labor Statistics (BLS) on its November 8, 2013, Employment Situation Report, was calculated as follows:

However, when the 720,000 longer-term unemployed which were removed from the labor force in October are added back, the real unemployment rate actually rose to 7.7% (shown above). And, if we were to add back all long-term unemployed workers, removed from the labor force since February 2009, the real unemployment rate would be 13.4% (also shown above).

As I reported earlier this year, in Black Unemployment Rate Closer to 37.9%, there is an alternative to the federal government’s phony reporting. Shadow Government Statistics publishes a more accurate measure of unemployment based on pre-1994 BLS methodology. The seasonally-adjusted SGS Alternate Unemployment Rate reflects current unemployment reporting methodology adjusted for SGS-estimated long-term discouraged workers, who were defined out of official existence in 1994.

In other words, the SGS Alternate Rate adds millions of long-term discouraged workers back to the BLS estimate, which only includes short-term discouraged workers. In case you didn’t catch that, this means the BLS has eliminated long-term discouraged workers (i.e. those who have been without a job for so long that they haven't bothered to look for work in more than 12 months) from official unemployment statistics since 1994, thus distorting the true employment situation.

Accordingly, although the Bureau of Labor Statistics boasts of an official U-3 unemployment rate of 7.3%, and an official U-6 rate of 13.8%, the real unemployment rate, based on pre-1994 BLS methodology, has actually increased from 18.3% in January 2009 to 23.5% as of October 2013 (shown above).

Of course the Chief of the White House will simply continue to repeat something like, ‘Now that we’ve fixed (i.e. effed up) the nation’s health care system, it’s time finish fixing (i.e. effing up) the economy.’

“How long, O LORD? Will you forget me forever? How long will you hide your face from me?” ~ Psalm 13:1 (ESV)

All of the govt stats are manipulated, or glitches, or under reported then revised a week later stretched toward whatever political goal posts are needed on the front pages to give the godless democrats a political victory,

The more people they can drop off as ‘looking for a job’ the lower the ‘official’ reported unemployment numbers will be. There is no depression until [you] don’t have a job, and the unemployment rate again drops further and they tell you, ‘see things are improving!’

That was one of the things that bothered me about Romney, he didn’t say anything to call this lie out, Why not? I can only surmise he must have intended to use the same scheme when elected,

The skewing in that last Shadowstats chart is beyond ridiculous already,

How long can they keep lying to the people? Until their fall guy (ala Mccain sleazebag) establishment RINO republican is selected by their MSM, then they and their managed press reset the employment statistics reporting as officially “bad” and start the manipulations all over again with the designated followup savior democrat, . . .two steps forward, one step back,

It seems then we are in a continuing Great Depression. Sadly, no one in the media, in politics, or in the world of “Academia” will utter a single word.

Why we lack any voice confounds me.

“I can only surmise he must have intended to use the same scheme when elected”

That’s my take. He was an extreme left-wing liberal that registered Republican to get elected. Ann coulter supported that left winger so many Republicans blindly went along.

We’re hovering somewhere between a great depression and the new normal. The economy is no where near as good as what most of us remember. Good jobs are scarce.

But it can get much much worse. The jury is out on our future.

Not much is understood by the media these days, primarily because the government (i.e. BLS and BEA) keep changing the rules. When GDP, CPI or employment numbers look bad, they simply change the methodology in order to keep the numbers propped up. The media’s problem is they just assumes whatever the government reports is the gold standard. Thank God for sites like ShadowStats, because one day someone’s going to have to put all the pieces back together.

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