may have recently heard the good news:
the unemployment rate in this country fell
from 6.0 percent to 5.9 percent in November.
The news media heralded this revelation as a
sign of a economic recovery.
But is it?
people don’t seem to know how the Department of
Labor comes up with its statistics.
The friends and family I spoke with thought
that it was based on unemployment insurance claims.
Not so. In
fact, unemployment claims contribute nothing to
the unemployment statistics.
To collect the data, the Department of
Labor’s Bureau of Labor Statistics (BLS) conducts
a monthly survey of about 60,000 households
nationwide, called the Current Population Survey.
to the BLS, employed persons include those who
“did any work at all (at least 1 hour) as paid
hang on. If I
had performed one hour of paid work last week I
would be counted as "employed"?
Working one hour a week is my dream, but I
can’t possibly survive on what I'd earn.
definition of an unemployed person makes a little
more sense. You
must have worked less than one hour the preceding
week and be actively looking for a job.
Note that if you have given up looking for a
job then you are not counted as unemployed.
You are called a “Discouraged Worker”.
we are ready to do some math.
The BLS attempts to contact around 60,000
households (some percentage of these cannot be
percent of that that group would equal 3,600
people; 5.9% would equal 3,540 people, a difference
of 60 people. In
the survey group, the net gain in jobs is 60.
From this number, the BLS extrapolates that
105,000 people nationally found new jobs.
60,000 people represent about one out of every 2,500
people in the working population.
These are odds only a statistician can love.
One must be a true believer to think that by
talking to one person in a group of 2,500 you can
determine the plight of the other 2,499.
the BLS calls you on the phone, it doesn’t ask if
you are a
citizen, a foreign worker or an illegal alien.
The statistics include everyone who is
working in this country.
For example, a foreign software programmer
hired on a temporary work visa is counted as
employed.There are an estimated 1.7 million
temporary foreign workers in this country.
I have to say “estimated” because the
Department of Labor doesn’t keep track of those
immigrants are counted, too.
There are an estimated 10 million illegal
immigrants in this country.
we’ve just introduced millions of non-citizens
into our definition of the 146 million-person
of these people came here solely for jobs.
The software programmers came here on
temporary work visas.
When and if their jobs go away, so will they.
They are counted as employed today, but will
never be counted as unemployed.
When this category of people numbers in the
millions, it can really skew the numbers.
what about the “Discouraged Workers”?
According to the BLS survey there are 457,000
discouraged workers in the
gave up, they are no longer counted as unemployed.
another twist. The
unemployment rate for workers with a Bachelor’s
degree and higher, 25 years old and over, went from
3.0 percent to 3.1 percent.
We actually lost high-paying jobs in
was laid off from Cisco Systems in April of 2001.
Since that time I have struggled to find a
job – any job, anywhere.
I have seen massive outsourcing of computer
programming jobs to other countries.
I have seen the import of foreign programmers
as a means to boost corporate profits and avoid
retraining skilled professionals.
research in the Department of Labor database I have
found that the business unit in which I was employed
has hired 12 foreign software engineers - one of
which is probably sitting in my old cubicle.
I have seen the wholesale destruction of our
manufacturing sector as it steadily moves overseas.
I have seen part of a marathon U.S. Senate
debate, lasting a whopping 40 hours.
Somewhere around hour 29, Senator Harry Reid
outlined what had been lost since the debate began:
the government ran up another $300 million more in
debt, there were 36 more mass layoffs (a mass layoff
involves 50 or more people, 3,194 more people ran
out of unemployment benefits; and 5,137 more people
declared personal bankruptcy (now at the highest
level in history). And
what was the Senate debating?
They were debating the fate of four federal
judge nominees who already have high paying jobs
with great benefits.
the BLS survey there were 60 new jobs in October.
I was not one of those 60 people.
According to the BLS survey 457,000 people
have given up looking for work.
I am not yet one of those people.
But I’m damned close.
December 15, 2003