Friday, March 9, 2012

Unemployment Stagnant at 8.3%, But That's Not the Whole Story

They're popping the champagne corks in the White House and in MSM newsrooms across the country today. The new unemployment figures are out and show a whopping decrease from the previous month's figure of 8.3% to the wonderful new number of, um, 8.3%.


If all you do is listen to what you're told by the MSM, you'll think that happy days are here again. Nothing could be further from the truth. The bad times are still with us: millions of Americans are still out of work or underemployed (like a certain Boy you all know and love), gas prices are approaching record highs, everything in the grocery store has doubled in price in the past four years, yoots cannot find jobs of any type, the list goes on.

Here's a bit of analysis of the numbers this administration and it's communication division, the Progressive Pravda expect you to believe, courtesy of The American Enterprise Institute.

Even if it were a legit number, the 8.3% February unemployment rate, released today by the Labor Department, would be simply terrible—and unacceptable. It would still extend the longest streak of 8%-plus unemployment since the Great Depression. The U.S. economy hasn’t been below 8% unemployment since Obama took office in January 2009. And back in May 2007, unemployment was just 4.4%.
But, unfortunately, the true measure of U.S. unemployment is much, much worse. 
1. If the size of the U.S. labor force as a share of the total population was the same as it was when Barack Obama took office—65.7% then vs. 63.9% today—the U-3 unemployment rate would be 10.8%. 
2. But what if you take into the account the aging of the Baby Boomers, which means the labor force participation (LFP) rate should be trending lower. Indeed, it has been doing just that since 2000. Before the Great Recession, the Congressional Budget Office predicted what the LFP would be in 2012, assuming such demographic changes. Using that number, the real unemployment rate would be 10.4%.

(Emphasis theirs)

As Insty would say, read the whole thing, it's not long.

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