Unemployment Myths, Mysteries, and Fantasies

Here are some posts and questions about unemployment and weekly claims, and my answers, all were posted here at the MSNBC website.  

 

I have highlighted IN RED the wrong and seriously questionable comments made by these various posters, and tried to inject a little knowledge and logic:
  

The drop in claims this week is due to the TeaParty!

From Duphas at MSNBC:

...This is real change,.... not Obama Change though, as I'm sure the Liberals and Lame Stream Media (oh, but I repeat myself) will try and make you believe.

The EPA's shelving or protaction of the new and ever increaseing, and more stringent Reg's on "Big Industry", are helping. Thank you Conservatives!!!, Thank you "Tea Party Nuts", they are the real hero's. 

Plus the fact that Oil and Gas drilling and hydrofracting in South Texas, Pennsylvania and now North Dakota have had a dramatic affect (of the positive sort) on the creation of American Jobs, helps just a little bit.

North Dakota's boom is only just beginning, and so long as Obama & Liberal Co. can keep their hands out of the Oil & Gas Industry's pocket's, the Jobless Rate will continue to tumble.

My reply:

North Dakota's unemployment rate actually went up last month. North Dakota is a small state, and, while there are still more jobs in North Dakota in August than in July, there are more people also. Though the civilian labor force (people employed plus people looking for work) increased by 1,300 in North Dakota last month, there were only 800 more jobs.  Perhaps North Dakota's job market is getting saturated with so many newcomers?  We forget how small North Dakota really is with less than 400,000 jobs altogether.    

And Duphas, you really don't care about clean air and clean water.. those are just petty, job-killing regulations? And I bet you can't list one specific regulation that was "shelved" in the last month that has had an immediate effect on decreasing the number of layoffs (if that is true). Fracking is extremely controversial, but I guess you think that people's concerns and  complaints about tainted drinking water and salty streams are just liberal gobbedly-gook. 

But there's a drop in claims and you somehow give credit to the TeaPartiers. That's really, really a stretch.

That was a fascinating comment.  I'm sure this person is attributing every lost job since 2006 to the Democrats, but any good news has to somehow be attributable to the Republicans.  

It is impossible to determine the number of people who are unemployed.

From Biteme (responding to Horseperson):

Sorry, they can use both new claims and existing claims to come up with the statistics that they report. This is why,along with a number of other left out important factors, it is impossible to determine the accurate number of unemployed citizens in our country. Also, this is why they can report it even though it is not accurate.

My Reply:

No, Biteme. This number is based on "initial claims", not continuing claims. Continuing claims numbers are released as well, and they went down 20,000 this week. The numbers used for the weekly claims reports ARE NOT input into the monthly reports. There are officially 14,000,000 people unemployed and about 15,000,000 more underemployed or who "want a job" but have stopped looking.

The number of claims dropped because nobody is working anymore and people have run out of benefits.

From spacecadette:

"The new unemployment claims have to go down because there are no new or old jobs to get unemployed from... duh! and also many people that have been unemployed have run out of benefits, extensions and what not and are part of the unaccounted for! please people ask your neighbors or about your neighbors that have had to move out and move in with their family or even Yogi bear in the woods ..... a lot of the national parks are filled with families turned nomads trying the next town to find a job ...... geezzzzzz..... the media as a whole thinks it can still be used to brainwash us ..... those that have money and are holding it have better sense than to believe what the media says, it's about balances ."

My reply:

"There are over 130,000,000 non-farm jobs, about a million more jobs than there were a year ago, so there are still plenty of jobs from which people can get laid off. Initial claims numbers would have nothing to do with people running out of benefits, as those people wouldn't be filing "initial claims". Does that make sense?

Yes, there are plenty of people who have lost their homes, had to double up with families, many buying beat up RV's and taking to the woods, others camping in tent cities. 

The number of the long-term unemployed has gone up, even though the total number of unemployed has gone down by about a million people over the past year. So there can be a decrease in the number of weekly initial claims even though there are more people doubling up and/or moving into the woods. It would take a big, big decrease in total unemployment to give so many people jobs and resources so that they can again live in decent housing vs. surfing on somebody's couch.

There are more unemployed than there were; and I ran out of benefits so I am not counted.

From Siir Sam:

"The problem is really simple. "new" jobless claims fell. That could mean the old claims are the same, but the rate of unemployment/layoffs didn't keep up at the same pace as before. There are still "new" jobless claims, meaning that more people are jobless. Also, they could be in the same situation as I am: I haven't been able to get work, so my benefits have run out and I can't file a new claim. I'm still unemployed, just not counted any more. Shows what statistics can lie about and how the public is totally fooled by politicians."

My reply:

Continuing claims fell as well, by 20,000. Yes, more layoffs do mean more unemployed, but, for the last few months, there have more people hired than laid off (or quit). In July, 3,920,000 people were "separated" (either laid off or quit), while 3,984,000 people were hired. The total number of additional workers or jobs was only 64,000. 

Even in the depths of the recession, people were being hired, about 4,000,000 a month. But that is not enough hiring to make up for all of the 8 to 9 million lost jobs in 2008 to early 2010.

If you have run out of benefits, you are not counted in this weekly claims report; you are right about that, but if you are still looking for work, you are counted among the 14,000,000 officially unemployed. Almost 7,000,000 are receiving benefits now, but 14,000,000 are officially unemployed. Also, the number of very long-term unemployed is increasing, though I can't find those numbers offhand.

So there is no reason to assume that these statistics are "made up".. Why would any official who wants to "make up" statistics make up statistics this bad?

The Bush tax cuts kept the job numbers in 2001-2003 from being as bad as the job numbers now.  Therefore, tax cuts work; stimulus does not.

From Logic Required:

America had a recession that took place around the period of 2000 - 2002, 9/11 having a very real impact on a already soft economy. Bush cut taxes, which yes was deficit spending but the initial jobless claims reports in 2003 and 2004 the years following his tax cuts ran around the 340,000 to 360,000 range. Obama does a massive spending stimulus and the years following we are around 400,000 and suppose to get excited when it is "only" 391,000. I think the verdict is in, although both add to the deficit, tax breaks and cuts passed by a Republican majority actually helped pull us out of a recession, while stimulus spending passed by a Democrat majority has left us in stagnation. Numbers don't lie, journalist and politicains do.

My Reply:

Logic Required, There is no way you can equate the recession of 2001-2003 with what happened in 2007-2008. Also, the term "jobless recovery" was used often during 2003 even into 2005, and the kinds of jobs people were getting were not that great.

When the Democrats talk about two or three million more jobs, they are talking about the Census jobs.

From somebody replying to Kilobyte:

KiloByte1339

"We the corporations?

Well, we saw it for the 15 months before the teabaggers were elected when Obama's economy created 3 million jobs..."

You mean those temporary census jobs that the libtards attempted to take credit for?"

My Reply:

Actually, no, we've had over two years of positive growth every month in private sector jobs. (There are close to two million more jobs (in seasonally adjusted numbers) than there were at the "trough" of the recession). Even last month, with a net of zero job growth, we had an increase of 17,000 in the private sector. Government jobs have been declining since the Census workers started to be laid off last summer and fall. Your TeaBag masters don't want you to know that, so they babble on about "census and government jobs".

Obama lost all of those jobs; Bush didn't lose any.

From Roy Wilson:

"Here's the official GOVERNMENT source on jobs info;2008 - Bush's last year = 145,362,000 net people employed.2009 - Obama's first year = 139,877,000 net people employed. A loss of 5,485,000 jobs.2010 - Obama's second year = 139,064,000 net people employed. A loss of another 813,000 jobs."

That's a total loss of 6,298,000 net jobs under Obama. That's something you will never see reported in the biased media. Here is the link to the BLS website to verify:

http://www.bls.gov/cps/cpsaat1.pdf

Just look under 'Employed - Total' for each year;By the way - The same government site shows total jobs of 136,891,000 net jobs for 2000 (Clinton's last year), so Bush had net new jobs of 8,471,000 net new jobs added in his 8 years.

I guess this is what might be called "An Inconvenient Truth".

My reply:

First of all, you are looking at ANNUAL averages when you look at those tables; you need to look at the monthly reports. Also, you are looking at numbers of employment, and that doesn't equal numbers of jobs. The jobs numbers are reported by private and the government employers; the workers' numbers are reported by a monthly census survey of the population. These numbers do not match for a variety of reasons.

Was there anybody foolish enough to think that Obama was going to immediately keep the country from losing jobs after he was inaugurated in 2009?  The peak of jobs was reached in December 2007 at 138,078,000 jobs. Some sectors, particularly construction, had been losing jobs for a year or more.

In January 2009, when Obama was inaugurated, there were 133,549,000 jobs. As monthly data is based on figures as of the week that contains the 12th day of the month, January 2009 job figures belong entirely to Bush.

So we lost 4,529,000 jobs under Bush in seasonally adjusted number.

The low point of jobs occurred in February 2010. There were 129,246,000 jobs. That's a loss of 4,303,000 jobs from the time Obama took office until the "trough" of the recession.  

We now have 131,132,000 jobs. That's an increase of 1,886,000 jobs.

You will have to look in the monthly BLS reports, available in the BLS archives. Again, you can't use annual averages for this kind of data. Jobs decreased throughout 2008, so the average of 2008 is quite a bit higher than it was when 2008 ended. And January 2009 job losses go under Bush's name.

By the way, when Bush took office in January 2001, there were 132,428,000 jobs. 133,549,000 when he left office minus that 132,428,000 gives Bush a net gain of 1,121,000 jobs.

At 400,000 layoffs a week, we're losing 21 million jobs a year!

From Roy Wilson:

(Quote from article:) 

""Claims tumbled to 391,000, down 37,000 from a revised 428,000 in the previous week and below the key 400,000 mark. Economists say that claims need to drop below 400,000 for an extended period to put a dent in the 9.1 percent unemployment rate. They need to drop below 375,000 for substantial job growth."

And next month, there will be another revision 'upward', which will be buried on page 17 of the NY Times.

Let's see now - an average of 400,000 people lose their job each week - that's about 4,800,000 per year. I wonder how those families feel about all of those 'jobs created or saved' that Obama promised?

Whoops - my math was off. 400,000 per week is about 21 million per year.

Sorry - haven't had my coffee yet."

My Reply:

Yeah.. that coffee does make a difference, doesn't it?

For these estimates, you'd have to look at the JOLTS report: Job Openings and Labor Turnover Survey. You are right that approximately 400,000 people file for claims every week, but there is always hiring activity.

Even in the gloom of the deepest part of the recession, 3 to 4 million people were hired a month. In January 2009, 5,121,000 people were "separated"; about 2 million (1,980,000) of those people quit! (Remember that claims are not going to reflect people who quit, only those who were laid off and presumably eligible for unemployment.) 

So something like 3,200,000 were laid off during January 2009, which was a very gloomy month for labor. But employers reported that they actually hired 4,330,000 people in January 2009!  So 800,000 jobs were lost in January 2009, not 5 million.

Which is why your calculations won't work. Companies keep on hiring, even when other companies are laying off.

In July, the latest month for which JOLTS data is available, 3,964,000 people were hired.

We have almost 4,000,000 hired a month; that's 48,000,000 hired a year against the 21,000,000 who are filing first time claims for unemployment (400,000 a week). And approximately 2 million people a month that quit. 24,000,000. That's about 48,000,000 hires for a year against 45,000,000+ who are laid off, fired for cause, quit for some reason. (Not all who are terminated are eligible for unemployment compensation.) 

We've had about a job growth of about two million over the past year and a half. The numbers fit.

Miscellaneous employment myths:

From Old Timer:

"Why do we not report the U-6 unemployment rate, which was the rate reported during the 1979-83 and previous recessions, instead of the rosier U-3 unemployment rate, which excludes several groups from calculations and hence the numbers look better? According to the U-6 unemployment rate, which is still published by the Dep't of Labor, last month, 16.2% of Americans were either unemployed, discouraged and not currently looking for work, or are working part-time when they want full-time hours. The 9.1% U-3 rate is a fantasy designed to make the numbers look better since it excludes discouraged workers and workers over age 55 who have dropped-out of the workforce, who are counted as retired. Teen unemployment is not counted either."

My reply:

I've been around a long time as well, and I never remember the U-6 rate being commonly reported. In fact, the alternate unemployment rates were not calculated quite the same way back in the 70's and 80's as they are now, and the more common alternate unemployment rate was the U-7 rate. The U-3 has been the common unemployment rate reported ever since I was young and first knew what it was.

The U-3 rate is good enough for comparison purposes: If it goes up .2%, that's bad; if it goes down .2% that's good. My alternate unemployment rate is at 18.3% now. That includes people working part-time who want full-time work and people who "want work" but have stopped looking for a variety of reasons.

The U-3 rate does not, as you correctly say, include discourage workers. For people to be counted in the U-3 rate, they need to be actively looking for work in the past month. People who have stopped looking are not counted in the U-3, no matter what age they are; and people who are still looking are counted in the U-3, no matter what age they are. I'm not sure where you came up with the "55 and over" thing. That's simply NOT true. Teen-agers looking for work ARE counted as long as they are 16 or over. Not sure who told you that one either.

The Bureau of Labor Statistics is pretty transparent as to what is and isn't counted in the various unemployment numbers, also how they perform their surveys and what changes they have made over the years.