How can 220,000 jobs be created and unemployment goes up???

[Pryderi]

Can someone explain it to me? Does this mean we had a net loss of jobs?

[onenote]

1. more people re-entering the job market

when jobs start becoming available, people who had taken themselves out of the market re-enter.

[foxfeet]

2. Yep. Exactly. nt

[Better Today]

12. I hope at some point soon, someone attempts to figure out why they are

re-entering the job seeking arena. It could be because "things are lookin' up" or it could be because they temporarily attempted a small business and either failed or couldn't get financing. I'm concerned if the reasoning is more positive or negative.

That being said, it isn't a cheery day for those of us looking for employment, no doubt.

[whattheidonot]

13. discouraged broke, an offer.

Discouraged and broke in all ways. an offer comes up. $8.00 part-time, no benefits. that is sucking it up. What is really going on? the rich have sucked up the money and are not letting it go.

[Subdivisions]

20. Who do I report to that I am now returning to looking for a job? n/t

[WeDidIt]

3. Simple

Simply not having a job is not enough to be counted amongst the unemployed, you must also be actively seeking employment. With the addition of new jobs, people who previously had no job and were not actively seeking work have entered the job market again and are thus counted amongst the unemployed.

[DemocratSinceBirth]

4. From A Bright DUER Named Statistical

mean it really depends which changes faster. Net jobs or discouraged workers returning. It takes roughly 150,000 net change to move U3 by 0.1%. So say next month we create 200,000 net jobs however 500,000 discouraged workers rejoin workforce. That would give us a U3 of roughly 10.1%. On the other hand say next month we create 350,00 jobs however only 100,000 discouraged workers rejoin workforce. That woudl give us a U3 number of roughly 9.8%. Still doesn't really matter month from month but long term the "discouraged" returning to workforce will act like a headwind slowing the Unemployment drop.

Lets look at it on a macro scale over say 6 months:

There are roughly 3 million workers "discouraged".
The population change also results in about 100K (to 150K) new workers per month. This is net change. 100K more people looking for a job for first time minus number of people who die/retire.

So say in next 6 months we produce 3 million net jobs. If there were no other factors the U3 would decline about 2%, 9.9% to 7.9%.
However new workers soak up about 60,000 of those jobs. Now say 1 million discouraged workers rejoin work force.

Net - Net: (3 million - 0.6 million - 1 million ) = 1.4 million jobs = roughly a 0.9% inprovement in U3 = 9.9% to 9.0.

Don't take these numbers as gospel more as an illustration on how discouraged workers prevented U3 from going to 13% on the way up however they will now slow the U3 decline for very long time.

[Dr Morbius]

5. Official unemployment only counts those who are looking for work.

Many millions more have given up looking. The way unemployment actually increases with job growth is that people who previously gave up are now hopeful, and are looking for work. More people in the work force means a higher percentage of "officially" unemployed.

A much better and more useful tool is the unemployed/underemployed statistic. That one shows one in six Americans, give or take, need a better job than they have or need a job, period. I don't know when it comes out, but it takes longer for the feds to figure it out every month.

[Llewlladdwr]

16. U-6 numbers are also up.

Increased .2% to 17.1%

[NeedleCast]

6. More people are searching for jobs again

Here's an example:

My girlfriend's brother-in-law got laid off back in 2008. He searched for work for about six months, then went back to school. When he went back to school, he came off the unemployed numbers because he wasn't seeking work. He's due to graduate in two months and then he'd technically re-join the ranks of the unemployed.

[Subdivisions]

21. Who did he report to that he was looking for a job again? n/t

[phleshdef]

7. Simple. My wife for instance doesn't have a job, but she isn't unemployed either.

Because she isn't looking for a job right now. However, if she decides she is getting sick of staring at my ass all the time (I work in a home office), and decides she wants to go back to work, then she would be considered unemployed.

[ipaint]

8. It means the official unemployment rate has been artificially low for months. nt

[babylonsister]

9. Found this helpful article...

http://www.washingtonpost.com/wp-dyn/content/article/2010/04/04/AR2010040402964_pf.html

Jobless rate may rise as many are drawn back to labor force

[tuckessee]

10. Well, 100,000+ legal immigrants a month plus the undocumernted ones.....

....more than takes up the 220,000 jobs created.

edit - typo

[2Design]

11. they don't count those no longer eligible to collect unemployment or under employed

there are a lot of unemployed people

[SheilaT]

14. I think something like

100,000 new jobs need to be crated each month, on average, just to keep up with the new entrants into the labor force.

I believe that during the entire eight years of W's term there were no new jobs, on a net basis (meaning more than were lost in some way). None at all And, towards the end of W's term lots of people were posting charts here which showed that under Republican presidents as a rule, jobs were lost, no new net jobs were created. The only exception since Herbert Hoover was Bush senior, and it looked as if he got lucky in only serving four years. Under Democratic presidents, jobs have always been created.

Shortly into W's second term that kind of information quietly disappeared, even though occasionally it came out. It just wasn't really put out there by the MSM, and not very often by any other media.

The truth is, policies under Republican administrations tend to decrease overall jobs, policies under Democratic administrations tend to increase them.

[Statistical]

15. Most people think there are only 2 categories: employed and unemployed. This is wrong.

There are three buckets:
1) Employed
2) Unemployed
3) Not in labor market

So 220K net jobs mean 220K people moved from bucket #2 to bucket #1.

However at the same time 600,000 discouraged workers who the govt doesn't consider unemployed because they stopped looking starting looking again.

Thus bucket #2 GAINED 600,000 people. 600,000 in - 220,000 out = 440,000 more people in bucket #2 thus U3 rate rises.

[DemocratSinceBirth]

17. I Understand That Part

But how did U6 which covers everybody rise from 16.8% to 17%?

[Statistical]

18. Good question. Not really sure.

Would need to look at the raw numbers.

Some ideas:
Population & immigration could be part of it but I doubt it would be enough to swing it 0.2% ~ 400,000 people. Usually pop/immigration is something like +100K-150K net workers per month.

The cynic in me says illegal immigrants are included in payroll numbers (the net jobs numbers comes directly from companies) but not in household survey (the U3 & U6 rates come from phone survey) that might be another small source of discrepancy.


The other thing to consider is the stats are calculated by survey which does have a margin of error.

[csziggy]

19. Aside from all the other comments, how about the college and high school graduates?

They are or will shortly be out on the job market, increasing demand for jobs.

[Greyhound]

22. By massaging the numbers to the point of meaninglessness.

Our problem is that it is "our" guys doing the lying now, so we must not point it out.

[HughMoran]

23. Optimism

People are feeling better about joining the labor force, more rejoined than jobs were available, so the unemployment rate went up. This situation will eventually correct itself as jobs are created more rapidly (or, at least let's hope the jobs situation continues to improve).

[RagAss]

24. Because a Democrat is in the White House....we can't have good news, can we?