Skip to comments.The Unemployment Rate Is Meaningless
Posted on 05/04/2012 6:03:39 PM PDT by Kaslin
Jobs: Normally, a drop in the unemployment rate would be a welcome sign of an economy on the mend. But in the upside-down world of Obamanomics, the jobless figure is increasingly useless, hiding more than it reveals.
In April, the unemployment rate officially declined to 8.1% from the previous month's 8.2%, according to the Bureau of Labor Statistics. But you don't have to look very hard to see that the jobs picture actually deteriorated last month.
In fact, the only reason the jobless rate didn't climb in April is because so many people have simply quit looking for jobs and didn't get counted as unemployed.
Last month, 342,000 people disappeared from the labor force. Had that not happened, the unemployment rate would have been 8.3%, not 8.1%.
Worse, the labor force participation rate has been on a downward slide throughout Obama's presidency, as millions of workers have given up their fruitless job searches (see chart). That also masks the size of the unemployment problem.
Had the participation rate stayed where it was in June 2009 the month the recession officially ended the unemployment rate would be more like 11% today.
And when you add in all those who can't get full-time work because of the lousy job market, the jobless rate reaches Depression-era levels of 14.5% unchanged, by the way, from the month before.
(Excerpt) Read more at news.investors.com ...
I am still trying to figure out how 29.7 million people unemployed and around 200 million people between 18 and 65 creates an 8.1% unemployment number.
The old math seems to be closer to 14.8% unemployment rate.
Some of me friends used to ask me why I get up at 5:15 every morning and am sitting at my desk well before 7.
The ones who still have jobs don’t ask me that anymore.
Believe me if there was a Republican POTUS, your math would be in use by the MSM.
To heck with the “unemployment rate”. I think it’s time for the buffoons in Washington to start releasing the percentages of those in this country who are living off of unemployment checks or who have used up all of their unemployment and have moved on to disability.
This economists measures the nonemployment rate at 41.6%.
So here's the deal. Though I firmly believe that political pressure sways the calculative ability of those within the BLS, it's also possible that, because we are truly in a new paradigm, the current BLS methodology is simply outdated.
From 1982 to 2007, the U.S. economy was measured as expanding. Those who didn't have jobs often found jobs. Those who still couldn't find jobs, applied for unemployment "insurance". This transfer payment program provided some welfare to those in need of it until they could secure employment and, since the economy was "growing", most found work before the government checks ran out. And that's the key...the program has an expiration date for those on the dole.
The current expiration date is 99 weeks. This means that anyone receiving unemployment insurance will only receive checks for about 2 years before the government cuts them off. Now, as this pertains to today's jobs number is important. You see the BLS counts those receiving checks as part of the unemployed base. As part of the calculation, when someone stops receiving checks, they are no longer considered to be unemployed. For the 25-year period of 1982-2007, this was an OK way to do things as it was statistically correct to assume that someone no longer collecting unemployment insurance had now found a job. Now, however, that's not the case.
Instead, many folks are "long-term unemployed". They lost their job and applied for unemployment insurance and, after 99 weeks, the checks stopped coming. These folks are now considered by the BLS to have found a job but have they? Maybe a few have but just because the checks ran out does not mean that you are no longer unemployed. However, to the BLS, this is exactly what it means. So, payrolls can only increase by 115,000 and the labor force participation rate can fall to 64.3% but the stated "rate of unemployment" can also fall to 8.1%. TA-DAH!!! Barack The Magnificent can again proclaim at today's press appearance that the economy is strong and he should be re-elected.
because 14.8 percent is the real unemployment rate
It’s absolutely foreign to the young ones that you’re ahead of the boss. They think you should get a gold star for showing up.
The guy who signs my paycheck is sitting at his desk at 5:30 every morning. I’m usually the 3rd guy in.
“the labor force participation rate can fall to 64.3% but the stated “rate of unemployment” can also fall to 8.1%. TA-DAH!!”
We’re in uncharted territory. Call it “Free Fall Economics”.
The government could simply check who is having tax withheld. I guess since they already know that they just make up stuff to suit their purpose.
Hell, I'm one of them "evil leech" Civil Service guys and I often show up at 0400 even though duty hours begin at 0600. Stll don't have time to get everything done, but I try because I love the troops we support/supplement and train for their careers.