“Employment rose by 146,000 in November, and the unemployment rate edged down to 7.7 percent.”
--- Bureau of Labor Statistics, December 7, 2012
A good day for America is a bad day for Republicans. On the first Friday of each month,
the Bureau of Labor Statistics reports on the US employment situation. Lately, conservatives can hardly wait for the jobs report before they start throwing out accusations of numbers fudging. Republicans and numbers are never a good combination. They don’t know what to do with numbers. They think that Mathematics is a discipline that involves the use of their nose. Watch . . .
Where do the numbers for US employment and unemployment come from? The Bureau of Labor Statistics compiles a lot of data and categorizes individuals by their employment status, gender, ethnicity, occupation, industry, and more. The categorization makes sense in a US Government kind of way.
People are either in the labor force or out, employed or unemployed, and the relationships between these numbers determine the unemployment rate and other rates that are used to measure how many people are working or not.
The Bureau of Labor Statistics data can be found at www.bls.gov
A lot of people recognize an iconic chart that the Obama administration uses to illustrate the dramatic turnaround in the US economic situation in 2009. After the Democrats in Congress passed
The American Recovery and Reinvestment Act (ARRA) in February 2009 (aka the Economic Stimulus) and its implementation began, the steep job losses that greeted President Obama when he took office, were quickly minimized and turned into job gains.
Private Sector employment has increased for 33 consecutive months.
The Private Sector is the largest of three broad categories that encompass all jobs in the US. The other two are Farming and Government, including federal, state and local. Farming is excluded from statistics that are familiar to the public. The exact BLS wording in Friday’s statement was, “
Total nonfarm payroll employment rose by 146,000 in November, and the unemployment rate edged down to 7.7 percent.”
In November, the number of people working in the Private Sector rose by 147,000 while the number of people in Government fell by 1,000. The combination of Private Sector and Government employment provides the number of jobs reported as gained or lost by the BLS each month.
While Private Sector employment rose by 905,000 since Obama took office, Government employment fell 614,000. The recession in the Private Sector was followed by a recession in Government as austerity measures were implemented at state and local levels in reaction to budget deficits. During Obama’s first term, Government employment at the federal level held steady with a gain of 9,000 jobs, but 500,000 jobs were lost at the local level and the rest were lost at the state level.
The next chart displays the familiar Private Sector job growth overlaid with the loss in Government jobs. The timeline is also expanded to include 2002-2012. The steep losses in Private Sector jobs during 2009 are visible in blue, and the mini-recession in Government jobs that followed in 2011 is visible in orange. Now it appears a recovery in Government jobs is just beginning.
During the Bush administration, Government jobs were consistently added, visible in the orange which stays mostly above the horizontal line. The addition of Government jobs augmented the slow to moderate growth in Private Sector jobs during those years.
Private Sector employment is in blue, Government employment is in orange.
There’s one more employment category that’s a popular topic for discussion today. As outlined above, there are 88,883,000 Americans categorized as “Not in Labor Force.” (NILFs) This is a broad category that includes people who decided not to work for a variety of reasons. It also includes a subcategory known as "NILFs who want a job." It includes jobseekers who are categorized as “discouraged” due to long-term unemployment. The Bureau of Labor Statistics does a great job of slicing and dicing an enormous amount of data. It would be good if it could identify the "NILFs who want a job" more clearly. Their number has been around for a long time. It didn't suddenly appear with the Bush recession in 2008. It seems to indicate something endemic in the economy even if the population of "NILFs who want a job" isn't static. Some of them become ex-NILFs who want a job and others take their place. Because of the attention given to them, and their long-term presence in the economy they deserve more attention. Meanwhile, to get a better idea about the relative size of this group and visible trending, the next chart shows how the unemployment numbers would stack up if the "NILFs who want a job" were counted as part of the unemployed.
"NILFs who want a job" are an anomaly. They are Not in Labor Force by definition, so they are neither employed nor unemployed, yet they want a job, also by definition.
5:44 PM PT: Kossacks are smart. They want a definition The BLS has one. It's a bit laborious. "NILFs who want a job" have one of these characteristics:
(1) Persons who want a job, have searched for work during the prior 12 months, and were available to take a job during the reference week, but had not looked for work in the past 4 weeks.
(2) Those who did not actively look for work in the prior 4 weeks for reasons such as thinks no work available, could not find work, lacks schooling or training, employer thinks too young or old, and other types of discrimination.
(3) Those who did not actively look for work in the prior 4 weeks for such reasons as school or family responsibilities, ill health, and transportation problems, as well as a number for whom reason for nonparticipation was not determined.