Friday, October 03, 2014

The Unemployment Rate Fell From 6.1% to 5.9% In September. But How Good Actually Is That News?

If we look at the percent of the of civilian noninstitutional population that is employed, it registered only a very small increase. The reason why this might be important is that the unemployment rate can fall if people simply drop out of the labor force. If you are not actively seeking work, you will not be counted as an unemployed person. But dividing the number of people employed by the population avoids this problem.

It was 58.9649% in August. It rose to 59.0068% in September. So basically both months are 59%. You can see the numbers at Labor Force Statistics from the Current Population Survey. That is presented by the U.S. Bureau of Labor Statistics.

The last recession started in December, 2007. In 2007, we had 63% of the population employed. In Sept., we increased about 7 one-hundredths of a percent. In a year, that would be about .5%. If we do that for the next 8 years, we will finally be back to the 63% we had in 2007.

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