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December 2, 2011
Good News Bad News on the Jobs Report
Topics: Political News and commentaries
The AP and the NYT are reporting that the nation''s unemployment rate is down from 9% to 8.6%. That's the good news. The bad news, and the reality behind that number, is that the number dropped from 9% not because of any increase in jobs ... but because about 315,000 workers dropped out of the labor force, and the jobless rate counts only people who are actively looking for work.
The AP adds:
More than half the jobs added last month were by retailers, restaurants and bars, a sign that holiday hiring has kicked in. Retailers added 50,000, the sector's biggest gain since April. Restaurants and bars hired 33,000 workers. The health care industry added 17,000.Worth pointing out here is not only that the Labor Force participation rate fell from 64.2% to 64.0%, if that figure were at the same level it was at the time President Obama took office, the current unemployment rate would be 11% (hat tip - Doug Mataconis). And the most important take-away from the report is the fact that nearly three times as many people gave up looking for work in November as got new jobs.Even with the recent gains, the economy isn't anywhere close to replacing the jobs lost in the recession. Employers began shedding workers in February 2008 and cut nearly 8.7 million jobs for the next 25 months. Since then, the economy has regained nearly 2.5 million of those jobs.
For those sitting at home scratching their heads wondering how the unemployment rate can go down if people stop looking for work ... this Feb 2, 2010 video by Jim Geraghty offers a simple explanation (although it doesn't get into how one is considered part of the labor force or account for the self employed that may be working a little but are not turning a profit):
Related: Where Are America's Workers Going? Off the Books.
Posted by Hyscience at December 2, 2011 10:04 AM
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