AUG: +151,000 jobs. Unemployment rate steady at 4.9%. AUG details here!.. Jobs since Obama took office?... Unemp. rate under Obama?

Friday, April 5, 2013

Debunking: The Unemployment Rate Went Down Because People Stopped Looking for Work! Well...No....

"The unemployment rate went down because so many people stopped looking for work in great despair!  This is a bad thing!"

Well.....No.  I replied to the following comment at today's article on unemployment at Think Progress:

You all do realize that the only reason the unemployment rate dropped was because people gave up looking, right? That's NOT good...

You should read the article before going off about how things are getting better: "unemployment rate ticked down to 7.6 percent largely because the participation rate dropped". 
If you read elsewhere, you'll find participation was down by nearly half a million. Half a million people GAVE UP looking for a job and THAT drove the unemployment rate down. NOT GOOD!

No.  People did not "give up looking".  That's Republican propaganda.

Two groups of people left the labor force:  Young people 16 to 24 who were enrolled in school, and older people, 55+.

There is a "flows" report that shows the numbers of people entering and leaving the labor market.  For months now we have more people going from "not in the labor force" to "employed" vs. people going from "unemployed" to "not in the labor force".

Last month there were 6,409,000 people who were "not in the labor force" who either found a job or joined the ranks of those actively looking (the unemployed).  Meanwhile, only 2,745,000 people who had been unemployed stopped looking for work for some reason and  "dropped out" of the labor force.  (Remember these are the people who have dropped out.. the people who were "unemployed" (actively looking for work) one month and "not in the labor force" the next.)

The people who "dropped out of the labor force" had mostly been employed. 

Most of the people who "dropped out" of the labor force in March  were employed in February, which generally means they stopped working voluntarily, as they are NOT looking for work.  There were 4,204,000 people who were employed in February and "not in the labor force" in March.

Ten Million More People 55+

Please remember that we have 10.2 million more people in the "civilian noninstitutional population 16+", the base of employment/unemployment numbers, since Obama was inaugurated, and 10 million of those people are now falling into the 55+ bucket.  It doesn't take a degree in statistics to figure out what that is going to do to "labor participation". 

I'm going to repeat this:  The main reason that the number of people "not in the labor force" has been going UP over the past years.. the past 12 years, if I'm not mistaken, is that there are more older people, Baby Boomers in particular, in the population, and those people are getting older and retiring.  

Meanwhile, the number of people in the civilian labor force is the HIGHEST it has ever been for the month of March.  I'm going to repeat that:  We have never had as many people either working or actively looking for work in March as we had last month in March of 2013.  

So everything is just wonderful?  

We still don't know what the effect of the sequester will be.  But looking at one or two months and declaring that the sky is falling is absurd.  We've added over two million jobs each of the last two years, and many, many of the employment reports in those months seemed to be foreboding.. but, no, we did not go back into recession or negative job growth.  


  1. Well if you seek a job 24 hours 7 days a week, surely you will give up and stop looking for work.

    1. I'm not sure that I understand your point.

      I'm sure that there are people who have looked for work every day for months and years who need to take a break... perhaps for a month or two or three, if they have some means of support.

      But we're talking about numbers of people leaving the work force AS A WHOLE.

      And, AS A WHOLE, two groups of people are leaving the work force: Older people who are retiring, and young people who are entering or re-entering school.


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