"It profits me but little that a vigilant authority always protects the tranquillity of my pleasures and constantly averts all dangers from my path, without my care or concern, if this same authority is the absolute master of my liberty and my life."

--Alexis de Tocqueville, Democracy in America

Saturday, December 3, 2011

The November Unemployment Rate Drop Is Meaningless

Much may be made of the drop in the unemployment rate from 9.0% to 8.6% announced yesterday.   This Milwaukee Journal-Sentinel headline provides the standard left-liberal line that this is a "glimmer of hope":


It's not.   The economy only created 120,000 new jobs, with many of those seasonal, Christmas-shopping-related retail jobs.   Manufacturing jobs were flat.  

So why did the rate drop?   Most of it, if you dig into the statistics, came from 300,000 Americans leaving the work force.   They didn't find work; they actually lost hope of finding a new job.   It's actually not a "glimmer of hope," it's a fall into despair.   Only in America could 300,000 people losing interest in even looking for a job be viewed as a "glimmer of hope."    That's like every worker in Omaha, Nebraska, deciding all at once, to hell with it, this economy's going nowhere.

Here's the real story in a simple chart from the Bureau of Labor Statistics:

Since Obama took office, the labor force participation rate has dropped from 65.7% to 64.0%.   The difference of 1.7% of the civilian adult non-institutionalized population of approximately 240 million Americans is about 4.4 million Americans.   In other words, to get back to the percentage of people working that America had the day Obama was inaugurated, we'd have to add 4.4 million jobs, not 120,000!

No comments:

Post a Comment