We asked the same
question last week. Are things really getting better? Is that what
the 366,000 number shows? Hear me out.
Understand that
this weekly number is the total of those who have just lost their jobs are
applying for first time benefits. This weekly report, then,
measures the number of people making application for assistance,
and this total has decreased 12 out of the past 13 weeks - or
so the news reports claim.
Now, a
little reality.
Work force
data from the Department
of Labor (DoL) tells us that the unadjusted number, the actual number, of
people walking through the door to file for unemployment benefits for the week
ending December 17, was 418,466. The seasonally
adjusted number is a phony number designed to make a bad thing appear better
than it is. That 418,000 number, for example, was adjusted down
for winter conditions, college attendance (holidays, vacation time,
etc) and the actual season of the year (non-farm employment is higher int
he summer months than in the winter months). As a consequence,
more than 55,000 applicants were not reported because of the
"seasonal adjustment." Seriously, it is that simple.
To be fair, this unadjusted number was down a total of 17,256 from
the previous week.
Its kind of like
the government's reporting on inflation. Did you know that such reports
do not factor in heating and transportation fuel costs, nor does it
include the cost of food goods.
Also, the
initial reports on nearly all economic numbers are adjusted after they have
been presented. The 366,000 report will actually be closer to 368,000 to
370,000 before the next report. In the opening paragraphs of this
article, I mention a "decreased 12 out of the past 13 weeks."
That is only true if the initial reports are counted. It is not
true if you are comparing the adjusted reports.
Back to my
labor analysis:
According to the r539 report, that part of the work force
qualifying for unemployment benefits was 130.1 millions at the beginning
of 2010. Today, that number is down to 126 million. What
happened to those 4 million workers? They either started working for
themselves, got employed part-time, are working for folks who are not
paying into the unemployment fund or are now receiving extended welfare
benefits. 315,000 folks fell off the rolls, in November,
alone. Again, we have four million folks no longer being
figured into the employment/unemployment circumstance, making things looks
much better than they really are.
The U-1 report is
the weekly applications for benefits report.
The U-3 report is
what is called the national unemployment number. It really isn't,
but we will play the game. Currently the U-3 number is 8.6%
"unemployment."
The U-6
report shows 15.6
millions Americans who are marginally or part-time employed, looking for
work, or currently receiving benefits. This is everyone we know of who
wants to work full-time but is not. This is the lowest number for this
category since March of 2009.
All of this looks
good. But there is one lingering question I have. In 2004, I
know that the work force was officially reported at 138.5 million people.
Today, seven years later, it is 125.5 million --
13 million fewer workers during a time when the US population added more
than 16 million citizens. A larger potential work force with few workers.
What happened?
I am working on
this question, but, safe to say, someone is really playing
games with the current employment circumstance.
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