Townhall
Jobs
Numbers Demystified
By Andrew Puzder
Apr 05, 2013
Editor's
note: This piece was
co-authored by Michael Talent.
Trying
to figure out what the
“official” unemployment rate means can be very frustrating. Much of
what we
hear is complex and counter intuitive. The numbers seem inconsistent
with what
people are experiencing and many people are simply losing interest. We
hear
about growth in the non-institutional population, a decline in the
labor
participation rate, people who are unemployed and want a job not being
counted
as unemployed just because they haven’t looked for a job in 30 days,
and people
who are working part time because they are unable to find full time
employment
being counted as fully employed. Even the Bureau of Labor Statistics
breaks
down the jobs data in six different ways and calculates six different
unemployment rates.
Clearly,
the employment situation
is better than when unemployment peaked in October 2009 and there has
been some
positive economic news, particularly in the February jobs numbers. Yet
large
numbers of people are still unemployed and jobs are still hard to find.
When a
company announces open positions, the line of job seekers is long and
snakelike
as hundreds, if not thousands, of unemployed Americans wait for a
chance to
apply. There is a sense that while things could be worse, something is
amiss.
Is the unemployment picture really improving? Are the government’s
economic
policies working or masking serious underlying problems? We need a
simple
metric that tells us whether the economy’s is generating enough jobs.
So, we
decided to propose one.
In
an effort to cut through the
clutter, we went back to the basics. While the economy has been
“recovering,”
our employable population has also been growing. On average, about
119,000
people join our labor force each month and they need jobs...
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