Tag Archives | get a job?

Lies, damned lies, and unemployment statistics

     The latest word from the federal number-crunchers says the November unemployment rate dropped to 8.6% from 9% the previous month.  So why doesn’t it feel like the job market is getting better?
     Simple reason:  The government does not include people whose unemployment benefits have run out in the official unemployment figures.  So while 120,000 new jobs were added to the economy in November, the more important number was 315,000–the number of people who dropped out of the work force.
     That is a distressing number.  As The New York Times pointed out, unemployment and underemployment is a problem that Congress continues to largely ignore at a time when government economic stimulus and programs to preserve some semblance of a social safety net are needed more than ever.
     As a tax pro, I look to government reports for a lot of reliable information.  But I hate it when the official statistics mask the reality of Americans’ daily lives.

The economy is improving? LOL

The White House tells us the economy is improving.

Tell that to anyone looking for work today.

Unemployment is still at recession-like levels, even with a recent surge in hiring. As David Leonhardt points out in this New York Times column, financial crises tend to produce uneven recoveries featuring several years of high unemployment.

How do you help bring down unemployment? Increased government spending on public works programs is one path – people get jobs; they earn money that they can spend, which helps the businesses that get that increased revenue; more taxes are paid by the individuals as well as by the businesses; and the surge in business activity can even lead to further private-sector hiring. All in all, a financially beneficial circle.

Cutting government spending, of course, is more like a death spiral. Nobel-winning economist Paul Krugman has been banging the drum for the past year about the failure of belt-tightening as a path to prosperity in Europe in general and Britain in particular.

The Tea Partiers’ fondest wish is something like the current experiment of Britain’s Conservative Party, its Orwellian-named “Big Society” program, featuring government-funded social programs being replaced by volunteers (I Am Not Making This Up—here’s a piece on the program from The Guardian). Financially beneficial circle? More like circling the drain.