Behind the Lower Unemployment Rates

The statistics we hear about don't give a full picture on jobs. That's good news and bad news.


Some of the ways that we measure the economy just don’t square with our daily reality. Take the unemployment rate, announced to great fanfare each month. A lot of people think it measures the percentage of Americans who don’t have jobs. But that would be too simple. The Bureau of Labor Statistics explains the measurement — 8.1 percent last month — this way: “The official concept of unemployment … includes all jobless persons who are available to take a job and have actively sought work in the past four weeks.”

There are plenty of unemployed people who haven’t looked or applied for a job in the past month. Sure, some are enjoying “funemployment” (see the TV show Girls if you need a definition of that), but a vastly larger number are what are called “discouraged workers,” or people who have stopped regularly looking for work because they just aren’t finding any. Many have run out of unemployment benefits, if they ever qualified for them. In fact, a different figure (U-6) measures the percentage of the civilian population that is unemployed or underemployed for economic reasons. That figure was 14.5 percent last month.

The issue isn’t just that there’s a huge gap between the unemployment rate and the broader un- or underemployment figure. The unemployment rate begins to seem like a bad joke when you have months like April, when it drops not because more people are getting jobs but because more people drop off the employment rolls and become discouraged workers. Of course, when it comes to the African-American community, the official unemployment rate is 13 percent as of April, and the total percentage of un- and underemployed African Americans is likely double that.

UC Berkeley’s Center for Labor Research and Education produces a monthly brief on African-American employment. “Three things are evident from the April jobs report,” the center’s labor-policy specialist Steven C. Pitts told The Root. “First, the drop in the official black unemployment rate [from 14 percent in March to 13 percent in April] confirms the downward trend in unemployment, which began in August 2011.

“Second, part of the decline in black unemployment is due to the slow increase, since December, in black men who have dropped out of the labor force,” he continued. “This increase mathematically reduces the official unemployment rate. Third, for the second consecutive month, overall growth in payroll employment has been lower than expected. This slow job growth reduces the probability that discouraged workers would regain optimism and resume their search for jobs.”

Of course, the employment crisis doesn’t affect the lives of just everyday Americans. It also has a huge impact on the political future of the commander in chief, President Barack Obama. Jobs are seen as his greatest weakness, a point hammered home by his opponent Mitt Romney and in the media. For example, an article in the Christian Science Monitor embedded a grim quote from an economist in its headline: “With Meager Jobs Growth, ‘Time Running Out’ for Obama.”