themcglynn.com

06 Nov

It’s Jobs, Stupid

Hindery Report on Effective Unemployment: 19.2%

The effective unemployment rate is 19.18% not the BLS-announced rate of 10.20%

Friday, Nov 06 2009, 9:39AM

Using its Current Population Survey (CPS) of Non-Farm Jobs, the Bureau of Labor Statistics just announced this morning, November 6, 2009, that, “Total non-farm payroll employment declined by 190,000 in October and the unemployment rate crept to a 26-year high of 10.2 percent, up from 9.8 percent in September.”However, as we have been noting, the public BLS figures, while widely distributed, notably exclude changes in employment among the nation’s 10,968,000 farm and self-employed workers, who are more than 7% of the Civilian Labor Force, and they do not take into account the 14,905,000 workers who are part-time-of-necessity (9,284,000), marginally attached (2, 373,000), or “discouraged” and have left the labor force (3,248,000).

The Summary of U.S. Effective Unemployment – more accurately (1) includes farm and self-employed workers and (2) accounts for effectively unemployed workers not in the official BLS announcement. This Summary also identifies various measures of weeks unemployed, job openings, and job shortfalls.

Accordingly, as adjusted, at the end of October 2009 or for the month:

1. Total combined employment – nonfarm, farm and self-employed – declined by 484,000 jobs in the month instead of the BLS-announced non-farm only figure of 190,000;

2. The total number of effectively unemployed and underemployed workers is 30,605,000 not the BLS-announced number of 15,700,000; and

3. The effective unemployment rate is 19.18% not the BLS-announced rate of 10.20%.

Since the official start of the recession in December 2007, the number of effectively unemployed and underemployed workers has increased by 13,723,000, instead of by the aggregate 8,159,000 jobs loss figure that the BLS officially reports. In contrast, we needed to create 2,376,000 new jobs in these 22 months just to keep up with the natural growth in the labor force of 108,000 workers per month.

For workers in the official Civilian Labor Force, the average number of weeks unemployed is now 26.9. And the number of workers unemployed 27 weeks and longer stands at 8,842,000 (i.e., 5,594,000 officially counted plus the 3,248,000 discouraged workers).


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