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"True Unemployment Rate Already at 20%

Published:

Last Edited: July 8, 2009, 1:31 pm

"True Unemployment Rate Already at 20%

July 8th, 2009

Via: MSN:

Source Cryptogon.com

"Really, how hard is it to find a job? Was June’s horrid numbers, in which 467,000 people lost their jobs compared to 345,000 in May, a one-time fluke? Or does it mean that all those Wall Street economists who believe the economic recovery is starting are dead wrong?

Not to scare you, but the situation is actually worse than it seems. Over the years, the government has changed the way it counts the unemployed. An example of this is the criticized Birth-Death Model which was added in 2000. The model is designed to account for the birth and death of businesses and the resultant lag in survey data. Unfortunately, the model doesn’t work that well during economic contractions (like we have now) and consistently overstates the number of jobs being created each month.

John Williams of Shadow Government Statistics specializes in removing these questionable tweaks to the government’s statistical data to better align current numbers with the methodology used to gather historical data. After reviewing the data, Williams believes that “the June jobs loss likely exceeded 700,000.” David Rosenberg of Gluskin Sheff notes that the fall in the number of hours worked in June (to a record low of 33 per week) is equivalent to a loss of more than 800,000 jobs.

There are similar issues with the way the unemployment rate is measured. The headline rate only jumped from 9.4% to 9.5% because of a drop in the number of people in the workforce. The more inclusive “U-6″ measure of unemployment, which includes discouraged workers, jumped from 16.4% to 16.5%. But even this doesn’t adequately capture the situation on the ground: Back in the Clinton Administration, the definition of discouraged worker was changed to only include those that had given up looking for work because there were no jobs to be had within the last year.

By adding these folks back in, William’s SGS-Alternate Unemployment Measure rose to a jaw-dropping 20.6%. Separately, the Center for Labor Market Studies in Boston puts U.S. unemployment at 18.2%. Any way you cut the numbers, the situation is very bad. According to David Rosenberg, one-in-three among the unemployed have been looking for a job for more than six months and still can’t find one."

http://cryptogon.com/?p=9751

Entry #1,226

Comments

1.
LOTTOMIKEComment by LOTTOMIKE - July 8, 2009, 1:47 pm
i believe it.i haven't worked since january.i had the same job a decade.back then there were 20 pages of classified ads full of jobs.imagine my shock when i looked here a few months back and there were 2 pages.scary.
2.
konaneComment by konane - July 8, 2009, 3:58 pm
Thanks Mike!!! I'm hoping the Arkansas lottery gives you an even playing field to begin winning and increasing your revenues very soon!!! You've won before and will again!!!! Best of luck!!!! =)
3.
Comment by budward - July 8, 2009, 4:08 pm
Don't forget what gangstapuppet said" You ain't seen nothing yet!"
Good luck to Mike!!!
4.
konaneComment by konane - July 8, 2009, 6:21 pm
Thanks Budward!!! Yeah if you dig a bit, the light in the tunnel is a loaded freight train on turbo. What's happening right now is comparably scary as the early 60's Cold War era waiting for the next shoe to drop.
5.
TigerAngelComment by TigerAngel - July 8, 2009, 6:56 pm
Where I live we have a lot of farm workers that don't get counted in the off season. I've always guessed the unemployment rate here for years to be 25%. But the offical # was usually around 10%. In about 1982 I went to apply for a job at a new small donut shop, so did 400 other women! (Not that I haven't worked since then, lol)
6.
konaneComment by konane - July 8, 2009, 7:25 pm
Thanks TigerAngel!! Dontcha love the internet where truth comes tumbling out???
7.
jarasanComment by jarasan - July 9, 2009, 9:36 am
I don't like feeling European!
8.
konaneComment by konane - July 9, 2009, 1:10 pm
Thanks Jarasan!! Didn't our forefathers draft a Constitution to prevent us from being subjects? Now Robinghood and his merry band are digressing us into a fiefdom.

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