Unemployment: The real numbers and the real problem
Not only the real numbers, but the real reason:
Labor-force participation, the share of Americans who are working or looking for jobs, has fallen to its lowest percentage since the mid-1980s. That’s partly because people have grown discouraged about their ability to find jobs and have given up looking. With those workers on the sidelines, the unemployment rate has been lower than it otherwise would be.
The official unemployment rate hit 9.1% in May. Including all of those who had part-time jobs but wanted to work full-time as well as those who want to work but had given up searching, the rate was 15.8%.
Of course Dale has been saying that for some time with his own calculations. Discouraged workers, however, may also have taken another option – retirement – since it is the age of Baby Boomer retirement. So it’s not clear yet how many of those who were workers and lost their jobs are “discouraged” workers or retired workers. Bottom line, though – a lot of people have seen their lives drastically changed.
Here’s the inherent problem in long-term unemployment:
[T]he odds of finding a job steadily decreased the longer someone was out of work. Some 30% of Americans who had been out of work for less than five weeks found new jobs last year.
Those odds deteriorated for the long-term unemployed. Of those who had been unemployed for more than six months, slightly more than 10% found new jobs. Nearly 19% dropped out of the workforce.
The problem endures this year: As of May, 6.2 million had been out of work for more than six months and more than 4 million haven’t work in more than a year.
And the outlook, at least at the moment, doesn’t look like it will change anytime soon.
This is Obama’s political Achilles heel. This is what gets incumbent presidents an early retirement. I’m not hoping that this persists through the 2012 election, I’m suggesting that there is nothing to indicate it won’t.
That is Obama’s challenge. And it is also the GOP’s attack line. This is Obama’s record – something he has to run on for the very first time. Time to begin pointing it out now.