Saturday, February 11, 2012

FactCheck: What’s the ‘Real’ Jobless Rate?

"As the Obama administration basked in the news that the unemployment rate in January dipped to a three-year low of 8.3 percent, Republicans Mitt Romney and Newt Gingrich threw a wet blanket on the announcement. Romney said the “real unemployment rate” was actually 15 percent, and Gingrich said that when you include people who have simply given up on trying to find a job, the rate “jumps up to about 12 percent . . .”
Neither Romney nor Gingrich put things quite right. But they are referring to legitimate yardsticks of “alternative measures of labor underutilization” put out by the Bureau of Labor Statistics.
That’s a daunting title, but to have any chance of sorting though the unemployment spin — which we’re sure to be hearing an awful lot of this election season — you’ll need to familiarize yourself with an assortment of labor measurements labeled by the Bureau of Labor Statistics (BLS) as U-3 through U-6.
U-3 — This is what BLS calls the “official unemployment rate.” It represents unemployed workers who are actively searching for a new job. That’s the 8.3 percent rate that made headlines last week.
U-4 — This is the total unemployed plus “discouraged workers.” Discouraged workers are those who have given up looking for a job because they are convinced there aren’t any available for them. It was 8.9 percent in January.
U-5 — This is the total unemployed, plus discouraged workers, plus “other persons marginally attached to the labor force.” The marginally attached are people who are neither working nor looking for work, but indicate they want and are available for a job and have looked for work sometime in the last year. But they aren’t counted as unemployed, because they didn’t actively search for work in the last four weeks. That rate was 9.9 percent in January.
U-6 — This is the catch-all of the lot. It includes all of the above groups — total unemployed, discouraged workers and the marginally attached — plus part-time workers who say they would like to be working more, but for economic reasons could only find part-time work. It was 15.1 percent in January."
The right wing spin started on the unemployment stats with Rush Limbaugh who said:

The regime needs this, and when we finally get to under 9%, it will be eight-point-something, but the point-what won't matter.  The only number that's going to matter is the eight . . .
This is nothing more than the government manipulating the real work situation that exists in the country.  It's all calculated to create a false impression of economic recovery and a healthier job market.  It's truly outrageous -- and watch how the Obama media cronies regurgitate this propaganda for the most part. 
The FactCheck article does not support Limbaugh's contentions

See the complete article at What’s the ‘Real’ Jobless Rate?

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