Is 10% The New "Normal?"

Maybe AP called it right.

Unemployment is at 10% for the second month.   Every job sector continues to shed jobs except for health care and service industries,  while the number of marginally attached workers grows.  2.5 million workers are either giving up or have given up looking for work which ups the unemployed total from 15.3 million to 17.5 million.  Marginally attached and disenfranchised workers are not included in the 10% figure.  So in real numbers the unemployment rate is at least 11.6%.  That’s not an increase it’s just a more realistic number.  Almost 12 out of every hundred Americans is out of work. 

So there is no immediate evidence that the holiday season buoyed the employment picture except to keep it from looking worse.  There’s something to be said for that to be sure, but January may end up looking a good deal worse as a result of part time workers being let go after the Christmas rush.  These folks may find themselves back in the marginally attached category. 

BLS has also announced that it is changing what and how it will report data starting in February.  I’m not sure why, but we should continue to pay attention to the totals to make sure nothing gets lost in transition.  They plan to recalculate data going back a bit as well.  It will be interesting to see which way the figures go.  It also looks like they are going to break out the details and reporting further to get a broader look at how classifications of workers are being affected, but how much good that does us is unclear.

What BLS needs to do is provide a number that tells us what the real rate of unemployment is compared to what they report instead of leaving it up to arm-chair economists and bloggers to work out on their own.  And I realize that the ‘real number’ is a bit subjective and might not look as good, but then that’s the point.  Real people are hurting in this economy.  More than the 10% number conveys.  We deserve to see more clearly how these figures relate to real unemployment.  Only then can people assess how to proceed to resolve the problem. 

The alternative is to accept what AP reported back in November.  That 10% unemployment was something we should just get used to.  But then, that is what Europeans have been contending with for decades.  If that’s the change we were waiting for, it might be time to change it back.

Comments

[Ed Naile]

10% is normal, in fact almost appealing, for any socialist nation.

[Steve Mac Donald]

That seems to be the case. And it does serve a purpose for a socialist minded leadership.