Monday, January 9, 2012

Obama Sure Is Happy About the Unemployment Rate

Obama is happy about the 8.5% unemployment figures. And so is the media. Could the re-election process be this year? But, how are these figures calculated? Read on...

The lonelyconservative reposts:

President Obama sure is happy with an unemployment rate of 8.5%, so is the media.

President Obama has claimed success. He has hailed the latest jobs report as “real progress” for the economy.

We have waited years for this “real progress” to happen. Real progress is an unemployment rate of 8.5 percent. Real progress is the more than 13 million still out of work. Real progress is the 18.2 percent underemployed (total unemployed and discouraged workers). Heck, real progress is the 1.4 million homes lost to foreclosure (and counting).

Read the whole thing for examples of how the media is helping Obama claim success. I’m sure they will fail to mention that there are now far fewer Americans in the labor force than when Obama took office, and if not for so many simply giving up the unemployment rate would be much higher. In short, the economy still sucks.

Via Fox Nation, Daniel Wetter writes:

President Obama has claimed success. He has hailed the latest jobs report as “real progress” for the economy.

We have waited years for this “real progress” to happen. Real progress is an unemployment rate of 8.5 percent. Real progress is the more than 13 million still out of work. Real progress is the 18.2 percent underemployed (total unemployed and discouraged workers). Heck, real progress is the 1.4 million homes lost to foreclosure (and counting).

Paulcraigroberts post tries to set the record straight on how the unemployment numbers are calculated

The following report is based on the work of statistician John Williams of shadowstats.com.

Today’s (Friday, January 6) payroll jobs report of 200,000 new jobs in December is overstated by at least 82,000 jobs. As approximately 130,000 new jobs are needed each month to stay even with population growth, the December job figures actually indicate that the US economy fell another 12,000 jobs behind.

Forty-two thousand of the reported jobs are the result of a glitch in the BLS seasonal adjustment model that produces a false jump in December “couriers and messengers” jobs.

Forty thousand of the jobs result from the “birth/death” model that BLS uses to estimate the net effect of unreported jobs lost from business closures and jobs gained from new start-ups. The model is structured to represent normal times. During the bottom bouncing of this protracted downturn, the model over-estimates new jobs from start-ups and under-estimates job losses from business failures.

The official unemployment rates (U3 and U6) no longer measure all of the unemployed. The Clinton administration ceased counting as unemployed workers who had given up looking for a job for one year or longer. No discouraged workers are included in the widely reported U3 measure. The U6 measure includes workers who have been discouraged for less than one year.

In other words, the longer an economy is in the doldrums, the less the official unemployment rates are reliable measures of the extent of unemployment. The unemployment rate in December as measured by U3 is 8.5%; as measured by U6 which includes short-term discouraged workers (less than one year) is 15.2%. John Williams’ measure which includes the long-term unemployed is 22.4%.

In other words, the real unemployment rate is 2.6 times the widely reported U3 rate, which is the rate emphasized by policymakers and the financial press.

In

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