HAPPY DAYS ARE HERE AGAIN: Jobless Rate Falls to Lowest in Three Years...
The jobless rate fell from 8.5% to 8.3% on the wings of 243,000 jobs created. So goes the story.
Click on image to enlarge
So, why are so many not all that excited? For starters, 36.7% of those old enough and able to work are not . . . . . . . . . working. As of this past January, we are looking at the highest percentage of non-working working class citizens in history. You may not believe this number, but 1.7 million folks left the workforce in the same month we are touting the 8.3 unemployment percentage, January, according to the Department of Labor (cf DoL pdf, p8).
The 2nd chart, my home grown adaptation of the original, actually has "Reagan" misplaced. As you well know, Reagan came into power following the Carter years and a recession with higher negatives in many categories than the current recessionary period. The Reagan Recovery saw the fastest increase in the workforce in history. By contrast, the Obama Recovery (that is what he is calling this thing, right ??) includes the sharpest decline in the size of the workforce [also] in history.
In the second year of the Obama Recovery (2010), much like the Reagan Recovery, there was an increase in the size of the workforce. . . . about the time Biden announced that the recession was over and introduced us to his "Summer of Recovery." But, unlike Reagan's recovery, Obama's policies failed within months (if not weeks) and the remainder of the "recovery years" has been a disaster with the work force at its lowest percentage of the total number of folks able to work (63.7) in 30 years [see chart immediately below with Department of Labor stats, on this matter].
Year | Jan | Feb | Mar | Apr | May | Jun | Jul | Aug | Sep | Oct | Nov | Dec | President |
2002 | 66.5 | 66.8 | 66.6 | 66.7 | 66.7 | 66.6 | 66.5 | 66.6 | 66.7 | 66.6 | 66.4 | 66.3 | Bush.. 43 |
2003 | 66.4 | 66.4 | 66.3 | 66.4 | 66.4 | 66.5 | 66.2 | 66.1 | 66.1 | 66.1 | 66.1 | 65.9 | |
2004 | 66.1 | 66.0 | 66.0 | 65.9 | 66.0 | 66.1 | 66.1 | 66.0 | 65.8 | 65.9 | 66.0 | 65.9 | |
2005 | 65.8 | 65.9 | 65.9 | 66.1 | 66.1 | 66.1 | 66.1 | 66.2 | 66.1 | 66.1 | 66.0 | 66.0 | |
2006 | 66.0 | 66.1 | 66.2 | 66.1 | 66.1 | 66.2 | 66.1 | 66.2 | 66.1 | 66.2 | 66.3 | 66.4 | |
2007 | 66.4 | 66.3 | 66.2 | 65.9 | 66.0 | 66.0 | 66.0 | 65.8 | 66.0 | 65.8 | 66.0 | 66.0 | |
2008 | 66.2 | 66.0 | 66.1 | 65.9 | 66.1 | 66.1 | 66.1 | 66.1 | 65.9 | 66.0 | 65.8 | 65.8 | |
2009 | 65.7 | 65.8 | 65.6 | 65.6 | 65.7 | 65.7 | 65.5 | 65.4 | 65.1 | 65.0 | 65.0 | 64.6 | Obama.. |
2010 | 64.8 | 64.9 | 64.9 | 65.1 | 64.9 | 64.6 | 64.6 | 64.7 | 64.6 | 64.4 | 64.5 | 64.3 | Obama.. |
2011 | 64.2 | 64.2 | 64.2 | 64.2 | 64.2 | 64.1 | 64.0 | 64.1 | 64.1 | 64.1 | 64.0 | 64.0 | Obama.. |
2012 | 63.7 | Obama.. |
Unemployment went down because [in part] 1.7 million people left the work force, to fend for themselves. Some went on welfare of some sort; the younger adult crowd moved back in with their parents; others went to work "under the table," not reporting their wages in return for not having to report their income. Still, others went to work for themselves, again, making money "under the table." More than 5 million Americans have opted out of the public workforce since Obama took office, preferring one of the several options listed above. There are 89 million able bodied adults no longer figured in the "unemployment" numbers (see ZeroHedge for more discussion).
Remember Obama coming up with the bright idea of forcing everyone who paid out $600 or more for anything, food, gas, lawn care, property clean-up, helping a family move . . . whatever, to fill out and report these transactions on a 1099 form? It was part of ObamaCare and was to go into effect this month (Jan 2012). Of course, the logistics of such an asinine provision made the law impossible to enforce, a laughable bit of idiocy coming from the fertile mind of Obama.
As an example of just how nonsensical this proposition would have been, I have a friend who drives truck cross country. With this law, he would have had to keep all receipts for diesel and record them separately, per each gas station at which he purchased fuel, just in case he bought $600 of fuel over the course of the year from any one of those stations.
What Obama was trying to accomplish was this: he knew the workforce was "shrinking," that these folks didn't just disappear; they were making a living some way. So he tried to tax the "underground economy" (more power to those folks, btw) via the 1099 idea, a task that proved to be impossible.
Point of post: to give context to all this "good" news we heard, today (Friday, Jan 3rd)). When 1.7 million people leave the workforce in a single month, a lower unemployment rate (8.3% in this case) is hardly the good news we had hoped it might have been. . . . . . . . . . . And I haven't discussed the 2.3 million people who lost jobs in January, but, because of the process known as "seasonal adjustments," we are being told that 243,000 jobs were created. While "seasonally adjusted" might be an important process, still, 2.3 million working in December have been laid off in January.
Related story: see this short CNBC video news story : SANTELLI: Here's What's Wrong With Data...
Related story: see this short CNBC video news story : SANTELLI: Here's What's Wrong With Data...