Liberals Are Nerds, Too

Following the announcement of new unemployment data, last Friday, Chris Altchek published 3 graphs, arguing that the positive national unemployment figures were deceiving because workplace participation had decreased. At the time, conservative PolicyMic pundit, Gary Patterson, and I found we agreed that the graphs were unhelpful because there was no context around them.

Then, 2 days later, liberal pundit, Paul Anderson, published something of a rebuttal: workforce participation actually increased in January, due to corrections/manipulations of other data. So, what are you to think? What do these statistics really mean?

The aggregate national unemployment rate of 8.3% is nearly meaningless. A tenth of a percent up or down is a directional indicator, at best. That means: watch the trend. If the unemployment rate drops by a tenth or two each month over a year’s time – that’s generally good. You have to dig into the data at the state and metropolitan area levels, and track how it has responded over time to outside forces, to be able to draw any meaningful conclusions.

For example, North Carolina’s overall unemployment rate has stayed fairly steady - between 9.7% and 9.9% - for at least a year, now. That reflects a number of factors, including the veterans returning from deployment overseas to our eight military bases – among them, Ft. Bragg and Camp Lejuene – to re-enter the workforce, as well as Senator Kay Hagan’s (D-N.C.) work to cosponsor the VOW Act. It seems we might just have broken even, there.

We had severe storms that spawned tornadoes in April, 2011 – ravaging eighteen counties and ruining their economies. Many businesses were temporarily closed down or destroyed entirely; putting people out of work.

The North Carolina State Assembly cut the budget drastically and threw thousands of state employees onto the unemployment rolls but we had some good news, as well. Companies including Apple, Siemens and Caterpillar brought in data centers or factories. Sometimes these investments only create 50 jobs at a time but that makes a huge difference in a single county. We have federal funds coming into the Charlotte area to extend our light-rail system, so hiring and rebuilding along the proposed route has increased. 

Topline data in the charts highlighting a swell of people leaving the workforce are also subject to the "smoothing" effect of national aggregation. Some articles on PolicyMicrecently, have referenced women returning to school instead of looking for another job, and recent graduates’ frustration with the job market. Those trends definitely show up in the numbers. There just isn’t any way of teasing it out separately.

Making a big deal about changes in the monthly national employment rate is – by itself – about as nonsensical as putting one’s faith in political polls…and for the same reason. So many components and variables go into making up that national figure that, unless you have a firm grasp on them, you find yourself slithering in a slimy slough of sloppy syllogism.

Photo Credit: BLS