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)
Labels: Unemployment Numbers 7/09
