With the election only days away, new data paints an even more bleak picture for the economic recovery and the policies of the Obama administration. According to new data released on October 31 by the Bureau of Labor Statistics, unemployment in America is more than 7.9%. According to the BLS, the true unemployment rate is 14.6%.
Fellow PolicyMic writer Michael Luciano does an excellent job of showing how it all adds up to 14.6%. For the sake of brevity, this rate includes workers who are currently working part-time that are seeking full-time employment, and also workers who are unemployed who have completely given up the search for employment. Thus, when the Obama administration tells you the economy is getting better, what it really means is that Americans are just giving up.
Here are a few simple statistics that paint a picture of the economic situation in America. Since Obama took office, the work force has grown by 8.4 million people, i.e. recent graduates, immigrants, and spouses or non-working family members who suddenly find themselves having to take on a job to support their family. This means that 5.5 million jobs had to be created in order to keep up with the job market growth.
Peter Ferrara, General Counsel for the American Civil Rights Union, said that "during President Obama's entire term in office, a grand total of just 787,000 jobs have been created overall on net. And all of that net growth came in the last month. As of August, 2012, the economy was still suffering a net loss of jobs during Obama's entire presidency up to that point."
So, if the labor force has grown by 8.4 million and only 787,000 net jobs were created during his entire presidency, why has the unemployment rate stayed basically the same at 7.8% since Obama took office? One would expect that the unemployment rate would be higher.
The answer is that millions of people have simply given up the prospect of working in America. Specifically, 8.2 million able-bodied workers are sitting at home because they gave up the hope of finding work under the Obama administration.
Many say that the economy is improving. However, an unchanged unemployment rate and a small burst of job growth this month does not indicate that the economy is turning for the better. When millions of able-bodied workers have simply decided to live but not work in America, they are not counted as part of the work force.
Therefore, to account for the massive migration of able-bodied workers out of the American work force, the U-6 unemployment rate of 14.8% describes the economic situation in America more accurately than the U-3 rate of 7.9%, which is the traditional metric for measuring unemployment. Using the better-known U-3 unemployment rate to show that more workers are being hired is like saying that improving college graduation percentages are a sign that Americans are trending towards higher intelligence when college matriculation is at a record low
At the rate we are creating jobs and shrinking the work force, I would consider shorting the Dow Jones if Obama gets another four years. America is not a country where giving up should be synonymous with "improvement."