Saturday, August 08, 2009


Creative Accounting of Jobs Lost

So the July numbers are out and we lost nearly a quarter million jobs (less than expected--Happy Happy Joy Joy) but despite there being an ever less number of citizens employed, the unemployment rate fell by .1% (9.5 to 9.4--Happy Happy Joy Joy).

You may ask: How can there be less people employed but a lower jobless rate?

Good question. It is because .5% of the former numbers of individuals in the workforce have been removed. The workforce is defined as those with jobs and those looking for jobs. When people quit looking for jobs (because there are just none to be had), the workforce and the number of unemployed shrinks (even though actual unemployment is the same). Thus, less jobs but less unemployed vis a vis the definitions of workforce and unemployed. Without this sleight of hand, the unemployment rate would have been around 9.9%.

I wish I could report that this special accounting of the unemployed was a recent invention of the Obama administration but, alas, the Bush administration used it in 2003 (and perhaps other Presidents before that).

Ah, politics.

(h/t Jim Geraghty)


This practice goes back to at least the Clinton days, maybe even earlier, so I guess we have to give Obama a pass on this. Still, I'm pretty sure that the employment picture would be a damned sight better were it not for his socialist economic and energy policies.

Investors aren't investing and employers aren't employing because they're constantly waiting for the other Democrat economic shoe to drop.
Right. The sword of Damoclese of new regulation and new taxes and whether they will pass and in what form is causing those with money to invest to wait until the near future picture is clearer. This is just what happened under Hoover and FDR in the 30s. Not as much change as those who voted for Obama were wanting, I guess.
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