The Great, Obama Unemployment Rate Scam

Liberty Works ^ | February 9, 2012 | BoomerJeff

[NaturalBornConservative]

The Great, Obama Unemployment Rate Scam *

February 9, 2012 | By BoomerJeff *

Political communication in America is largely an effort to influence the perceptions of those who pay little attention to politics by stripping complex concepts and issues down to easily understood statistics and simplistic soundbites. In each of his first 33 months in office President Obama suffered because the easily understood Unemployment Rate remained very high. But over the past four months it fell from 9% to 8.3% and Obama and his media supporters are making the most of it. They tell us the economy has improved so much it is no longer an election issue and the President is no longer at risk of losing.

But it turns out that the Unemployment Rate statistic is misleading. It turns out that another statistic, the “Labor Force Participation Rate” has also declined. [Continued below the chart]

• The Labor Force is the sum of all persons who have jobs plus all who are officially classified as “unemployed.”

• The unemployment rate is computed by dividing the number of unemployed by the the labor force.

• The labor force participation rate is the percentage of all working age adults who are officially counted as “in the labor force.”

Today, there are millions of people who want jobs but don’t qualify as “unemployed” by meeting government criteria and are thus counted as “not in the labor force.” We know this to be true because, as the chart shows, the participation rate has steadily declined for three years. Excluding people from the labor force artificially lowers the unemployment rate.

The chart above shows that the decline in the unemployment rate coincides with a decline in the labor force participation rate. The next chart shows what would have happened to the unemployment rate if the labor force participation rate had not not changed since the beginning of 2009. [Continued below the chart]

The last chart below tracks labor force participation and unemployment during the Reagan Administration. The labor force grew by 9% or 15.5 million people during the Reagan years. Participation grew from 63.9% to 66.1%. This chart is the picture of successful economic policies that increased liberty and decreased taxes and government intervention in the economy. Millions of new people entered the labor force but after the severe Recession Reagan inherited the unemployment rate declined because employers were able to replace all the jobs lost in the recession and hire the millions of people who entered the labor force. Reagan’s unemployment rate was not artificially reduced by excluding millions from of the labor force calculation and he was rewarded with reelection to a second term by the largest Electoral College landslide in American history.

Via: Liberty Works - The Great, Obama Unemployment Rate Scam

I concur!

Related:

- Labor Force Contraction with Obama

- Manipulation 101: The Real Unemployment Rate

- Manipulation 201: Playing With Unemployment

[Mobilemitter]

Thank you for the awesome work in bringing facts and relative information into play. I know that conservatives and Freepers alike will enjoy it. I don't know that the mind controlled mediabots would recognize reality if it slapped them up-side their heads. Still, nice to know that some people are still paying attention and getting the word out!

[U-238]

Very Good Post!!!

[RetiredTexasVet]

Today, there are millions of people who want jobs but don’t qualify as “unemployed” by meeting government criteria and are thus counted as “not in the labor force.” We know this to be true because, as the chart shows, the participation rate has steadily declined for three years. Excluding people from the labor force artificially lowers the unemployment rate.

This is the key part. Think of all the high school (who don’t go to college) and college graduates that do not qualify for unemployment ... they will not be counted in the workforce until they get a job, hold it long enough to qualify for unemployment, and then lose the job. My guess is about 4 - 5 million people not counted.

[cpdiii]

Question

When was the methodology changed to exclude those that can not find a job but want one and have exceeded their unemployment benefits?

A good ploy the Republicans can use is to try to get a bill through Congress to extend unemployment benefits to an extra year, i.e. an extra 52 weeks. If that were done the unemployment rate would jump to about 11.5% and based on the trends in the work force would be 12 to 13% by November.

Would Harry Reid's Senate not pass this bill once it came from the House? Would Obama refuse to sign it? Harry Reid's Senate and Obama would be in a box.

[NaturalBornConservative]

"My guess is about 4 - 5 million people not counted."

I would call that a highly educated guess. Dead on! And a great comment too.

[NaturalBornConservative]

"When was the methodology changed to exclude those that can not find a job but want one and have exceeded their unemployment benefits?"

The BLS didn't start tracking those not in the labor, by who did or did not want to work, until 1994. That's when the BLS created U-4, U-5, and U-6 as alternative measures of unemployment.

"A good ploy the Republicans can use is to try to get a bill through Congress to extend unemployment benefits to an extra year, i.e. an extra 52 weeks. If that were done the unemployment rate would jump to about 11.5% and based on the trends in the work force would be 12 to 13% by November."

Great idea! Maybe they should make it an even 4 years, so that fellow conservatives won't think they're serious and fire them in the process.

[WilliamofCarmichael]

Good post. Thanks!

As for the recent census adjustments v. people being dropped well one economist is quoted as saying: There was not a big increase in discouraged workers,' economist Betsey Stevenson commented on Twitter. 'What happened was Census found a bunch of old people we had assumed died.' Read more: http://advisorperspectives.com/dshort/guest/Lance-Roberts-120206-Not-in-Labor-Force-Analysis.php#ixzz1llXfZtKh

Who determined that they were "still alive"?

The two biggest adjustments to populations have been in 2000 and 2012 (see URL link) -- both Democratic incumbent presidents with connections to 1960s Marxist campus radicals (campus spoiled brats, actually) and both election years with economic issues.

The population adjustments are estimates made year-to-year.

Furthermore with the census adjusted, the "data used to estimate the labor force participation rate is obtained along with other labor force data from the monthly Current Population Survey conducted by the Bureau of the Census for the Bureau of Labor Statistics."

The CPS is a monthly survey of about 60000 households. The answers to the survey given by those households are interpreted largely by computers.

How the computer interprets is determined by tables. Those tables are populated by government GS employees. Those government GS employees answer to the White House.

There are no questions on the survey like "Are you marginally attached to . . . ?" The questions have to be interpreted to make determinations relevant to the purpose of the survey -- and I am saying to get the answers that the White House wants or at least as close as possible.

[SunkenCiv]

[NaturalBornConservative]

[There was not a big increase in discouraged workers,' economist Betsey Stevenson commented on Twitter. 'What happened was Census found a bunch of old people we had assumed died.']

But the civilian non-institutional population grew at an average of 2,651,000 per year, on a non-seasonally adjusted basis, in the eight years prior to Obama, yet has only grown by 2,013,000 2,029,000, 1,788,000, and 2,651,000 in 2009, 2010, 2011, and 2012 respectively. So what's wrong with this picture? The January 2012 figure is normal, while the 2009 - 2011 figures are artifically low, 2011 being way off the mark. So it seems there may yet be more zombies out there than Betsey Stevenson would care to admit.

I agree that the monthly household survey is pretty much a sham. I'm still trying to find a soul who actually participated in one.

Ref: Manipulation 201: Playing With Unemployment