Obama’s Unemployment Lies
October 22, 2012 by Sam Rolley
President Barack Obama has been lauding the latest unemployment numbers during campaign speeches and debates in recent weeks as a sign of a turnaround aided by the policies of his Administration, but a closer look — as many conservatives have pointed out — reveals a dismal employment outlook.
Only about four out of 10 Americans currently have a job. And though the Labor Department’s most recent numbers indicate a drop from 9 percent in September of last year to 7.8 percent this September, the falling unemployment numbers are due largely to the way the Labor Department defines what it means to be an unemployed American looking for work.
The government assumes that about 5 percent of the American population is actively seeking employment — thus, unemployed — and another 3 percent are looking for work but have yet to apply for jobs. Combining the two figures gives the Labor Department its lofty 7.8 percent.
Currently, 23 million people are out of work or unemployed but actually looking for work. Add to that what the government subtracts as “discouraged workers,” and the numbers are much more frightening: 33 percent of Americans are not only unemployed but also don’t want a job. This is based on the ratio of employment to population, which gives a better picture of how many Americans believe it is beneficial to work rather than survive on the government dole.
At present, the employment-to-population ratio indicates that 58.7 percent of Americans are working, but a staggering 82 million are looking for work or are unemployed and don’t want work. That would put real population-based unemployment at a staggering 41 percent overall.
“The employment-to-population ratio is the best measure of labor market conditions and it currently shows that there has been almost no improvement whatsoever over the past three years,” Paul Ashworth, chief North American economist for Capital Economics, writes in a note to clients obtained by CNN.
The reason so many unemployed Americans fall into the “discouraged worker” category is a direct consequence of the government’s constant expansion of social welfare programs even in the face of a crippling National debt crisis. Recent numbers show that around 47 million people in the United States rely on food stamps and do so for longer periods of time than ever.
In a recent address to Americans, former Presidential contender Ron Paul lamented: “Not all of the unemployed are counted in the BLS unemployment numbers. This is no secret. In 1994 government statisticians came up with the term ‘discouraged worker’ to remove entire swaths of people from the unemployment statistic. Now all the government has to do to improve the unemployment numbers is discourage people from looking for a job.”
Paul cited in his address a lesser unemployment rate of about 22.8 percent from Shadow Government Statistics that, while not based on the employment-to-population ratio, uses a more economically conservative methodology to reach a lesser but still dismal unemployment rate.