This morning’s news that U.S. unemployment has hit 13.7 million, pushing the rate to 8.9 percent, tells only half the story of this recession.
The total number of Americans who are not working full-time but ought to be is actually about 22 million, or 15.8 percent, according to the Bureau of Labor Statistics.
Who are those other 8.3 million Americans? Call them the unofficially unemployed.
As The Ticker points out each time the Bureau releases the monthly unemployment figure, it does not include many out-of-work Americans.
There are many reasons for this.
The bureau, which is under the Labor Department, cannot use unemployment compensation records to count the out-of-work, because they are not reliable or up-to-date enough. The bureau also cannot count every out-of-work person.
Instead, as The Ticker reported here in December: “In the case of the monthly jobs report, the Labor Department contacts 60,000 households to determine the unemployment picture for the entire workforce, which consists of about 154 million Americans.”
The problem with this methodology is that it does not include millions of Americans who are not working full-time who ought to be. Those, in the bureau’s words, who are “marginally attached to the labor force.”
Those numbered an additional 2.1 million Americans in the first quarter of this year, the bureau said. Alarmingly, that number was up 35 percent from the first quarter of 2008.
Of this number, the bureau categorized 717,000 as “discouraged” workers, or those that have simply given up looking for work for any number of reasons. That number was up 70 percent from the first quarter of 2008.
“Discouraged” workers include a disproportionate number of young people, blacks, Hispanics and men, the bureau said.
On top of all of this, add an additional 3.6 million unemployed Americans who say they want a job but have not looked for work in the past 12 months.
The remaining 2.6 million or so officially unemployed Americans include part-time workers who would prefer to have full-time jobs, those who have not looked for work because of illness or transportation reasons and those who believe they have other impediments.
But even though these workers don’t count toward the official monthly unemployment number, they are nevertheless a true weight on the economy.
They don’t pay payroll tax, or as much of it as they would; they don’t contribute to Social Security or other government entitlement entitlements and they don’t spend as much.
The 15.8 percent figure is the highest since the bureau began keeping these figures in 1994. Excluding the current recession, the highest previous rate came in January 1994, when it hit 11.8 percent.
The number was 8.7 percent in December 2007, when the current recession began. That means the number of the unofficially unemployed has shot up 7.1 percentage points since then.
By comparison, the official unemployment rate has risen 3.9 percentage points since December 2007. This suggests that a greater percentage of people are becoming disenfranchised from the workforce than are getting laid off.
By the way, in February, the White House predicted unemployment would top out at 8.1 percent this year, a figure that was blown through the following month.
It has made no call on how high the unofficial unemployment rate will go.
By Frank Ahrens
May 8, 2009
Source: The Washington Post
I wish we could get an actual count of all who are unemployed. My husband and I are unemployed. We work in the construction industry. I do not tell people that I am unemployed, (except for employers) and I wonder if there are other people that also don’t say anything either. My son was just layed off from his job Monday as was another friend of ours. My sister got lucky and found a nice disabled man that is letting her live with him rent free to help him around the house. She was living out of her car for 6 months. I feel that it is getting to the point that the cities need to find out exactly how many people are seeking work. The really bad thing is that its hard to get back into a good job once a person goes over that line and loses their home and is actually “on the street”. I am scared for myself and my children. I have worked on preparing for the future so hard, and tried to do the right thing but now I am afraid that everything will be taken away from me. I have spent my “What if” savings. No one wants to buy my house or any of my goods. I am a good person. I don’t want to complain to people because I know they just can’t do anything about it any way. I did not vote for Obama, but still when I listen to him I think he is trying but what I see being done tells me that it is all a lie. I thought for sure by July that the stimulus money would get out to the construction industry but our employer has not been awarded a job in a year! I don’t think any money actually got sent out, I think there is more corruption in Government than we know. Also I believe that Government is to big, I seen that it takes $1 trillion to run Government in only three months – now thats too many people to run our lives. They act like they are God himself and well actually they are somewhat like God I guess becasue I sit here and wait to see what the hell they are going to do so that I can base my life, my career, my future on what they do. Thats not right! They have too much control. What is happening in my neck of the woods is that businesses are laying off people, they say they may rehire later. I have spoke to some of these people they say they will rehire at a much lower wage. My area is like the twilight zone; the best wage available is $15. an hour. 90% of the people make $8. per hour. house pmt 1100, elect currently is 150 (going up 20%), water 100, tele/tv/internet 135, car and insurance 650, no health coverage, food is very expensive. fuel is still too expensive. sales tax is expensive.
What would happen if all businesses on one certain day stopped paying any money to the government? What would happen???? Government workers would be layed off for sure. But really what do we see in our own cities that the Government is paying for? Uneployed people get money from the money that employers have already paid (and some employers pay ALOT of unemployment tax. Individuals and employers pay social security and medicare. What are the actual federal taxes paying for? the 4 T dollars that Government employees receive in a year? Can someone research this? Because I thought that I “An American” had a say in this too. I say its time to lay off Government employees. Major down size at federal and local level. Not sub contractors; actual Government workers! America needs to stand up and say Government workers including the President of the United States will work for only minimum wage until our people are back to work and we pay off our debts to these other countries. I keep on hearing were in this together. Act like it! Thank you, and I look forward to seeing the report on how much money goes towards Government workers.
How can they get a count from contacting people that are unemployed? I DO NOT ANSWER MY PHONE!! Hello I have bill collectors calling me. How can they get in touch with the people who do not have a phone. Get real. No job, no unemployment means no phone and no home. 78M people filed a 1040 tax return in 2008. These are working people, unemployed, and people receiving some kind of taxable benefits. We beleive our population is some where of 330M people. We have been getting numbers of 500k people weekly for how long now of new unemployed workers. What is the number in just the last 12 months? Could it be 24M? 24/78 = SCARY NUMBERS. These numbers can be found by asking the IRS and use of the labor dept. Someone with the authority should really get on top of this and tell us, the people who pay for their employment what is really going on.