By: Warren Beatty
The percentage of working age Americans that are employed is not increasing. In March 2010, 58.5% of all working age Americans had a job. In March 2012, 58.5% of all working age Americans had a job. So if the employment rate is exactly the same as it was two years ago, then how in the world can the Obama administration claim that things have gotten significantly better since then?
The Employment to Population Ratio, as it appears on this graph, fell to about 58.5% during the latest depression and has, under Obama, remained there. So even though the US population is growing, the jobs growth is absorbed by the population growth.
The last months have seen the unemployment rate drop from 8.3% for February, 2012, to 8.1% for April, 2012. How can that be, you ask? Well, the unemployment rate reported by the MSM, the “official” rate, is the U-3 rate. But that rate can be manipulated because it is calculated based on the “civilian labor force.” As Tyler Durden at zerohedge.com says, “… the reason why the unemployment dropped to 8.1% is that the labor force participation rate just dipped to a new 30 year low of 64.3%.” Be sure to look at the graphs Durden provides
There are 12.6 million working age Americans that are considered to be “officially” unemployed, but there are another 87.8 million working age Americans that are not working either. The federal government considers those Americans to be “not in the labor force” so they are not included in the unemployment rate. This is one of the key ways that the government manipulates the U-3 unemployment rate. As this graph shows, the number of people not in the labor force continues to rise.
According to Annalyn Censky at CNNMoney, “About six million people claim they want a job, even though they haven’t looked for one in the last four weeks. If they were to all start applying for work again, the unemployment rate would suddenly shoot up above 11%.”
In 2007, approximately 10% of all unemployed Americans had been out of work for one year or longer. Now the rate is above 30%. The average duration of unemployment today is about three times as long as it was back in 2000. One of the biggest obstacles to an economic recovery has been solving the problem of the long-term unemployed, those out of work for 27 weeks or more. Aparna Mathur, an economist at the American Enterprise Institute, says “about 43% of the 12.8 million Americans officially labeled out of work fall into the category of the long-term unemployed, which is huge, we’ve never seen those kinds of numbers in any recession.”
The long-term unemployment problem is reflected in the U-6 unemployment rate. The U-6 rate tracks not only those out of work but those who have given up looking for work. The U-6 rate is today 15.5%, unchanged from last month, nearly double the “official” U-3 rate. Mathur continues, “If you’re unemployed and you haven’t been looking for work in the previous four weeks than you’re not considered part of the official unemployed.” The U6 rate, meanwhile, “includes all of those people who are too discouraged to look for work.”
But that’s just my opinion.
“It isn’t so much that liberals are ignorant. It’s just that they know so many things that aren’t so.” – Ronald Reagan
Cross-posted at RWNO, my personal web site.