January 6 2012
Dissecting the New Unemployment Numbers
Nicole Kurokawa Neily
The biggest news today ISN’T about the GOP primary (phew!) – but rather, the December jobs (or should I say “work opportunities”?) numbers that came out this morning. With news that the economy added 200K jobs last month, that’s an encouraging sign for the millions of Americans struggling to get by. This brings the unemployment rate down to 8.5 percent, which is the lowest it’s been since March 2009. There are 13.1 million Americans out of work, 5.6 million of which has been for 27 weeks or longer (a full 42.5 percent.)
Without a doubt, some of the December gains have come from temporary holiday hiring, in fields like retail and related industries like shipping and warehousing (those Christmas presents had to get to you somehow!) But hey… there are fewer people out of work, so that’s a good thing, right?
Yes… but it’s not quite time to do the happy dance yet.
One important point to note is that the SIZE of the workforce is smaller than it was three years ago – there were 945,000 “discouraged” workers (defined by the Bureau of Labor Statistics as “persons not currently looking for work because they believe no jobs are available for them”) who are not counted in unemployment data. Should we have included those, the figures would be far more dismal.
In addition, the underemployment rate – those who are dissatisfied with their current job situation (not working as many hours as they’d like, overqualified for current job, etc) is still quite high, at 15.2 percent. That’s down from 15.6 percent in November 2011… but is still disappointing.
And finally, breaking down the demographics of unemployment, a few figures stand out. For those without a high school diploma, unemployment is 13.8 percent – compared to 4.1 percent for those with a bachelor’s degree or higher. Education counts. And finally, it’s important to acknowledge that the unemployment rate for teens is 23.1 percent. The responsibilities, as well as work and savings habits, learned at a young age will affect teens’ world views later in life – so a paucity of opportunities today for young people may very well set the stage for a lifetime of dependency.
Earlier, Politico’s Sarah Kliff tweeted that “More health care jobs = higher health care costs. Lot of jobs being added are very bureaucratic, administrative ones.”
It’s certainly a good thing that the nation has added jobs… let’s cross our fingers that these gains can be sustained! With 3rd quarter GDP growth at a sluggish 1.8 percent, it's obvious that we need to get even MORE Americans back to work in order to expand the economy. That way, we can provide improved economic opportunities for everyone.