Spinning Unemployment in a Collapsing Empire

[Joanne98]

The Bureau of Labor Statistics (BLS) reported Friday that the economy gained only 103,000 new jobs in December -- not enough to keep up with population growth -- but the rate of unemployment (U.3) fell from 9.8% to 9.4%. If you are confused by the report, you are among the many.

In truth, what fell was not the number of unemployed people but the number of unemployed people who are actively looking for work. Those who have become discouraged and have ceased looking for work are not considered to be in the work force and are not counted as unemployed in the U.3 measure. The unemployment rate fell because discouraged workers increased, not because employment rose.

The BLS counts short-term discouraged workers (less than one year) in its U.6 measure of unemployment. That unemployment rate is 16.7%. When statistician John Williams (shadowstats.com) adds the long-term discouraged, the US unemployment rate as of December 2010 was 22.4%.

The question to ask yourself is: why does the media focus on the unemployment measure that does not count any discouraged workers? The answer is that the U.3 measurement only counts 42% of the unemployed and makes the situation appear to be a lot better than it is.

http://www.opednews.com/articles/Spinning-Unemployment-in-a-by-paul-craig-roberts-110110-495.html

[fasttense]

1. A ha, I thought the American economy needed all those long term unemployed

to have jobs in order to recover from this 2nd RepubliCON Great Depression.

Everyone (meaning the corporate media) is saying we have recovered, yet me and my neighbors are barely making ends meet. Every person I know has someone without a job in their family.

And yet I keep hearing how wonderful retail sales were this Christmas and how the unemployment rate has declined. I guess it's nothing but lies and manipulation.

[xchrom]

2. recommend

[Mulhane]

3. Hidden

Except the occasional sign-holding panhandler, in our automobile society they remiain hidden from the view and concern of most. Sounds like most of them have gone to live with relatives.

[pinqy]

4. Not an accurate article

In truth, what fell was not the number of unemployed people but the number of unemployed people who are actively looking for work.

But that's the definition of Unemployed, not just in the US, but the International standard.
The Labor Force are those actually participating in the Labor Market It doesn't make sense to include those not trying to work, such as full time students, retirees, stay at home spouses, etc, and for those who claim they want to work but aren't trying to get a job, on a practical level there's no real difference between them and those who don't want work...none of them are trying and so have no impact on the labor market.

The BLS counts short-term discouraged workers (less than one year) in its U.6 measure of unemployment. That unemployment rate is 16.7%.

This is misleading. BLS also counts Discouraged workers (defined as willing and able to work, looked for work in last 12 months but not last 4 weeks because they don't believe they'll find work) in the U-4 and U-5. The U-4 is Unemployed plus discouraged as a percentage of the Labor Force plus discouraged. That's what the article implies the U-6 is, but the U-4 is at 10.2 %. The U-5 adds in all Marginally Attached: willing and able to work, looked for work in last 12 months but not last 4 weeks for any reason at all (mostly personal issues, not labor market). That rate is 10.9%.

What the U-6 actually measures is Unemployed plus all Marginally attached (NOT just discouraged) AND all people working part time for economic reasons. So that rate includes 6 million people who have jobs (just not as many hours as they want). It's dishonest to imply that the U-6 just includes Discouraged.

[dmallind]

5. true - and not eewn news.

The rates have been defined the sane way for many years and the U6 snd other rates have always been calculated and released along with the U3 in BLS releases. Its not like the 3.7% under Clinton was the U6 rate and now everyone is using U3 to make things look peachy. The U3 rate has been the most publicized rate for decades. Outside afficinado discussions I had never heard all this crap about "real" unemployment rates until recently so it's actuallythe reverse and the talking heads are trying to create the impression that it's omly recetly the U6 has been that much higher than the U3.

[girl gone mad]

6. I don't believe there is anything misleading about the article.

To quote Calculated Risk, "A decline in the unemployment rate mostly due to a decline in the participation rate is not good employment news."

http://www.businessinsider.com/participation-rate-2011-1#ixzz1AerWlYuw

[pinqy]

7. The misleading part is...

...where it says

The BLS counts short-term discouraged workers (less than one year) in its U.6 measure of unemployment. That unemployment rate is 16.7%. When statistician John Williams (shadowstats.com) adds the long-term discouraged, the US unemployment rate as of December 2010 was 22.4%.

Adding in the discouraged is the U-4, not the U-6. The U-6 includes all Marginally Attached (not just discouraged) and people WHO HAVE JOBS, but whose hours have been cut (including temporarily) or who can't find full time work. As for Mr. Williams claims of adding in "long term discouraged," he has no means of obtaining that data (since no survey collects it) and even adding in everyone who says they want a job, regardless of if they've ever looked or could actually take a job if offered, doesn't give anywhere near a 22.4% rate...it gives a rate of 18.4%.

But again...to claim that the U-6 "adds in Discouraged workers" without stating the other groups it also includes is misleading.