Unemployment Rate Down As Americans Give Up On Work

[The Nature Boy 4,224]

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Unemployment Rate Down As Americans Give Up On Work
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The U.S. unemployment rate is down, but that is because many Americans have given up or — better yet — are struggling to find full-time work.

Dean Baker, an economist with the Center for Economic Policy Research in Washington, said Friday that the decline in U.S. labor force participation in this recent data release was “striking.”

“We know that a lot more people in their prime working years are opting to neither work nor look for work,” Baker told me. “Unless they have suddenly gotten an aversion to work or had some conversion so that they no longer value material things, they likely have given up looking for work because they don’t see any jobs out there.”

The unemployment rate has dropped more than 40% of the way back to its pre-recession level, but the employment-to-population ratio is closer to its trough than its pre-recession peak. In English: fewer Americans are looking for employment.

While women have fared better than men in the job market, this is mostly because they did not take the same hit to employment at the start of the downturn in late 2008 early 2009, Baker said today.

The Bureau of Labor Statistics reported unemployment fell to 7.7% from 7.9%, but the drop was at least partially attributable to a decline in labor force participation, Baker says. The employment-to-population ratio (EPOP) was unchanged at 58.6 percent, exactly the same as the rate in February of 2012 and just 0.4 percentage points above the low hit in the summer of 2011. This compares with an EPOP of 63.0 percent in 2007, pre-crisis.

Friday employment numbers were much better than economists’ expectations, but the numbers still show a weak job market four years into the economic recovery.

“This shows the depth of the recent employment recession – worse than any other post-war recession – and the relatively slow recovery due to the lingering effects of the housing bust and financial crisis,” writes Bill McBride of Calculated Risk. McBride also noted that the participation rate was well below the 66% to 67% rate that was normal over the last 20 years, although he pointed out that part of that decline is due to demographics.

The Bureau of Labor Statistics data show workers remain discouraged and many are unable to find full time employment, or have given up trying to.

Those numbers are only marginally better over the course of the last four months. The U-6 number under the BLS’ “Alternative Measures of Labor Underutilization” measures persons marginally attached to the workforce. That number is 14.3%, down from 14.4% in January and a much higher 15.6% last February.

[spookyturtle 9,466]

Finally! Good news.

[Pooky 3,840]

One report mentioned a million people leaving the workforce so far this year?

The actual figure was 806,000 in April, according to http://pjmedia.com/tatler/2014/05/02/unemployment-rate-down-but-workforce-plummets-by-806000/, quoting from the labor report.

Edited May 4, 2014 by Pooky

[Sousuke 1,214]

I know quite alot of people retiring. Its partially demographics.

[UncleBeer 244]

Finally! Good news.

Seriously? 806,000 leaving the work force? (and they're certainly not all retirees). LATimes says:

An alternate measure of employment, surveying households rather than establishments, showed an outright decline of 73,000 jobs. The only reason the unemployment rate fell is that the labor force shrank by about 800,000 people.....According to the Bureau of Labor Statistics, the workforce participation rate dipped to below 63% last month, more than three points below its pre-recession level. That means a massive number of people have dropped out of the workforce. At the same time, new claims for unemployment rose last month, which means that while the number of people getting hired increased, so too did the number of workers losing jobs.

BLS stats also show that in 20% of families, no-one works. Surely that's not " good news"?

Let's look at workforce participation. This chart shows that more than 41 percent of all working age Americans do not have a job.:

And a chart showing U6, but also including "long term discouraged workers". Certainly a component of the bigger economic picture that deserves consideration:

Surely we can't stand too much more "good news" like this...

[Jacque67 7,328]

Really? 41%?

[UncleBeer 244]

Really? 41%?

Yep. Granted, these numbers are from 18 months ago, but it's fair to say the unemployment situation has not improved much since then. In fact, instead of the 82 million unemployed stat, the current stat is 92 million, so the percentage could possibly be higher than 41%.

"The employment-to-population ratio is the best measure of labor market conditions and it currently shows that there has been almost no improvement whatsoever over the past three years," Paul Ashworth, chief North American economist for Capital Economics, writes in a note to clients obtained by CNN. That figure, which accounts for the proportion of working Americans compared with the number of adults in the country, is a lot higher than 8 per cent.

For now, 58.7 per cent of American adults are working if the actual employment-population ratio is taken into consideration, leaving about 82 million, or almost 41 per cent of people unemployed. Only 8 per cent, however, are even interested in work, leaving 33 per cent of Americans not only jobless — but with no desire for work.

[lostinblue 1,989]

[LibCampFireClub 635]

Hope and Change got a job

[Jacque67 7,328]

So that explains why so many dudes hang out here. Troubling indeed. Foreign wimmins, beware!

[The Nature Boy 4,224]

Hope and Change got a job

[Mr. Big Dog 10,747]

The labor force participation rate is in decline. It has been in decline and will continue to be in decline for some time to come. We call them the baby boomers.

That issue was dealt with rather comprehensively a few months ago when I demonstrated that the majority of the decline is due to demographics. That holds as true today as it did back in December.

[UncleBeer 244]

The labor force participation rate is in decline. It has been in decline and will continue to be in decline for some time to come.

Right up until January 20, 2017.

[LibCampFireClub 635]

Mr. Big Dog, on 04 May 2014 - 09:23 AM, said:

The labor force participation rate is in decline. It has been in decline and will continue to be in decline for some time to come.

Right up until January 20, 2017.

The 0blama regime thought peeing on the evil rich 1%ers would create jobs.

Edited May 4, 2014 by ExExpat

[UncleBeer 244]

The 0blama regime thought peeing on the evil rich 1%ers would create jobs.

Yep; that Alinsky class-warfare schtick was great for getting elected; not so much for running a country though. Ben Franklin said it best: "When the people find that they can vote themselves money, that will herald the end of the republic."