In spite of the seemingly positive unemployment numbers that have been trumpeted out of D.C. in recent months, the truth is, many American workers have simply given up on finding a job. As a result, they are no longer used to calculate the unemployment rate, making the official numbers an inaccurate depiction of what’s really going on in the workforce.
The typically left-leaning (seriously, AFL-CIO head Richard Trumka is on their board for heaven’s sakes) Economic Policy Institute (EPI) explains:
In today’s labor market, the unemployment rate drastically understates the weakness of job opportunities. This is due to the existence of a large pool of “missing workers” — potential workers who, because of weak job opportunities, are neither employed nor actively seeking a job. In other words, these are people who would be either working or looking for work if job opportunities were significantly stronger. Because jobless workers are only counted as unemployed if they are actively seeking work, these “missing workers” are not reflected in the unemployment rate.
Officially, the current U.S. unemployment rate is 7.3 percent. But if you include the so-called “missing workers” who have given up on finding a job, the rate climes to 10.1 percent.
The chart below shows the stunning rise in “missing workers” across the country over the last seven years:
Here’s a comparison between the “official” unemployment numbers and the more accurate numbers with “missing workers” included. As you can see, unemployment has declined from its peak, but at a much more subtle rate than the official numbers show.
Perhaps most disturbingly, 1.3 million Americans under the age of 25 — folks who are just making it into the workforce — have become so exasperated with their inability to find a career that they’ve stopped trying.
The idea that there is a giant, never-changing gap between the “haves” and “have nots” in America is mostly nonsense. The truth is, Americans tend to slide up and down the economic ladder throughout their lives, and overall work their way up over time. But when college graduates can’t even step up onto the first rung of the ladder in their 20s, the effects can be devastating — both socially and economically.
It would make the Economic Policy Institute folks’ heads explode for me to use their research to say this, but these trends are a direct result of the failed policies of the current administration, who discourage entrepreneurship and innovation through a never-ending assault of government regulation and taxation that, at this point, amounts to little more than government-sanctioned theft.
I would venture to say that ObamaCare — a single policy initiative — will have a more destructive longterm effect on America’s current and future workforce than all the policies of any entire liberal Administration in the past. (Note: that’s assuming they actually figure out a way to get their website working and forcing people to sign up.)
For more details on how the Economic Policy Institute came to the eye-opening results detailed above, visit their website where they have the full study on display.
Follow Cliff on Twitter @Cliff_Sims
