Home
Who we are
Quotes from the   Advisory Board
What we do
Membership

EMPLOYMENT & RELATED DATA

Uncommon Sense
Newsletter
Reprint Series
Special Reports
Quizzes
Faith Community

Unemployment figures are not always what they seem. The U.S. Bureau of Labor Statistics (BLS) regularly reports the nation's monthly and annual "official" unemployment rate. In 2007, this official unemployment averaged 4.6 percent, representing 7.1 million people. But these numbers don't tell the whole story. They are like the tip of an iceberg. The same BLS report provides data on large groups that are not counted as unemployed. Among them are 4.3 million involuntary part-time workers who wanted but weren't able to get full-time employment, as well as another 4.7 million people who wanted jobs but were not actively seeking work. Of that group, 1.4 million had searched for work during the previous year and were available to take a job immediately. The rest wanted work but had not looked for it because they didn't expect to find any, or weren't able to work for a variety of reasons, including lack of child care or transportation, or a disability. Public policy changes, for example, affordable child care, would enable many of these people to work. In addition, in 2006 (the most recent year for which such data are available), another 17.7 million people who worked full-time all year--one out of six--had annual earnings below $20,614, the government's meager poverty line for a family of four.

We need a new set of employment statistics that includes each of these four groups. Here is an example for 2007: 
 

*Source: estimated from Current Population Survey, Bureau of the Census, 2007

It should be noted that even these numbers do not include the vast prison population (2.3 million in 2007) that grew rapidly in the 1990's, made up disproportionately of young, unskilled minority men. [Currently, nearly one in a hundred American adults is in prison, including one in nine black men ages 20 to 34, NY Times, 2/29/08]. If inmates were counted as unemployed, the official jobless rate would rise by about 1½ percentage points.

Even these adjusted unemployment data do not capture a full picture of the job market now. This would have to include the decline in the share of the population in the labor force* since 2001, even for February 2008 compared to February 2007. There has also been rising share of prime-age men [25 to 54 years old] not working. This rate exceeds that of any other decade since WWII, more than doubling, to 13% at the start of 2008 from 6% in 1968. The rate has also risen, though less so, for women. A weak job market is also reflected in the decline in real wages over the last year.

Contrary to a widespread misperception that all of the unemployed collect unemployment insurance, most of them do not. (Nationally, only around two out of five of the unemployed receive benefits--and on average, these replace less than half of an unemployed worker's lost wages. Official unemployment figures come from a sample survey of the population, not from unemployment insurance offices.)

Unemployment had been falling since 1992, when it averaged 7½ per cent. It fell to a three-decade low of 4 per cent in 2000 but has risen somewhat since then, throwing more workers onto the scrap heap. [As we write in March 2008, it has been hovering around 5%]. Historically, elites have preferred higher unemployment because of the unfounded belief that lower unemployment means higher inflation. [See Uncommon Sense 3.] Though lower unemployment in the 1990's was accompanied by lower inflation, this belief dies hard, and is likely to be resurrected if unemployment starts to fall to the lows of the late 1990's. These elites also fear that lower unemployment leads to higher wages. Average hourly wages did rise modestly during the late 1990's, and that was good news. But they are still below their 1971 level in purchasing power. So even if unemployment falls again to 4 percent, that's not good enough. We can't stop before everyone who wants a job has one and all jobs pay a living wage. Until we recognize the extent of unemployment and low earnings, we will not develop the programs and policies to guarantee living wage Jobs for All Americans!

*The labor force includes both the employed and the officially unemployed.

For monthly updates on unemployment statistics, see jobnews.html on this web site. For further information about employment statistics, see Sheila Collins, Helen Lachs Ginsburg and Gertrude Schaffner Goldberg, Jobs for All: A Plan for the Revitalization of America, Apex Press, 1994, pp. 40-48 and 59-61.

The National Jobs for All Coalition is a project of the Council on International and Public Affairs.