Unemployment Rate is "Not So High"
At one of the many sites I cruise each day, a clearly sheltered individual made valiant efforts to argue that yesterday's June unemployment figures were a sign of glad tidings because a 5% unemployment rate was "Not So High", such that the focus of our efforts should be on speculating about why people are out of a job for a long time rather than on worrying about how many people actually have jobs.
That type of cluelessness usually causes me to reach for the Clue by Four. So I compiled some further data for his consideration, since I'm a big believer that speculation is always more entertaining if you have some further data to inform your thoughts about the unemployment being "not so high".
Let's deconstruct the "not so high" number using the Household Survey, just a bit....
The "not so high" unemployment rate of 5.0.% deliberately masks hides all the following underlying data:
Unemployment Rate including discouraged workers: 5.3%
Unemployment Rate including discouraged workers and "marginally attached workers": 6.0%
Unemployment Rate including discouraged workers, "marginally attached workers" and involuntary part-time workers: 9.0%
(Definitions of discouraged and marginally attached workers are at BLS' website).
I can't speak for you, but I don't consider 1/11th of our eligible workforce out there wanting to work and being unable to find that work as support for your contention that the unemployment rate is is "not so high."
I feel even more strongly when I look at the data relating to the distribution of the pain of unemployment across our work force. At present:
White Overall Unemployment Rate: 4.3%
Hispanic Overall Unemployment Rate: 5.3%
Asian Overall Unemployment Rate: Data Unavailable
African American Overall Unemployment Rate: 10.5%
White Males: 3.6%
Hispanic Males: Data not available
African American Males: 9.6%
White Females: 3.9%
Hispanic Females: Data not available
African American Females: 8.8%
White Teens (Aged 16-19): 14.2
African American Teens: 32.4%
(I find it fascinating that BLS can tell me with so-called certainty the current aggregate Latino unemployment rate but can't disaggregate the rate at the same time /shrug).
Oh well, every cloud has a silver lining, since seasonally adjusted, the white unemployment rate looks even better - having dropped from 5.0 to 4.3 (as opposed to holding steady at 10.3 for Black folk) over the past year. Clearly, Things are looking up.
The trending data indicates that the unequal distribution of unemployment based on race is getting worse, not better:
Change in White Unemployment Rate 6/04 -6/05: (From 5.1% to 4.3%, a decrease of 0.8%)
Change in Hispanic Unemployment Rate 6/4 - 6/5 (From to 6.5 to 5.8, a decrease of 0.7%)
Change in Asian Unemployment Rate - data for 6/5 unavailable per BLS; original rate was 5.0% in 6/04
Change in African American Unemployment Rate 6/04 - 6/05 (From 10.7 - 10.3, a decrease of 0.4%)
And to think that there was a time in the not so distant past that Black folks could actually joke about being "Last Hired First Fired". It isn't funny, anymore. Particularly when you consider that historically, Black unemployment has been about double of that suffered by whites (ever since the Agricultural Adjustment Act was passed.) That ratio of 2-1 has held pretty consistent throughout the decades, with a small dent being made into it during the Clinton Adminstration. Well, it isn't holding steady anymore. Right now, the ratio of Black to white unemployment is 2.67-1 and steadily climbing its way to 3-1.
And folks wonder with a straight face why the underground economy -- particularly the youth/gang crime economy -- flourishes despite all the harm it causes /sigh. It's pretty hard to moralize about what people do when they have ever-decreasing opportunities to put food on the table any other way, isn't it?
Look at those numbers closely. Think about them, with both your brain and your heart. Then decide whether you still wish contend so strenuously that the unemployment rate is "not so high". Maybe it isn't for SOME, but clearly that assertion is just dead bang WRONG when ALL are taken into account.
Finally, to really have a gut feel for what the unemployment rate means, one has to also look at how long folks stay unemployed. And if you look, what you'll find is that no small number of the unemployed are staying unemployed longer, even though the average number of weeks unemployed dropped. In the past year (06/04-06/05):
Change in Average Duration Unemployment: -1.7 weeks
Change in Median Duration: +0.9 weeks
% Unemployed <5 weeks (-2.7%)
5-14 weeks: +6.2%)
15 weeks - 26 weeks: -0.2
27 weeks and over: -2.8
The trend sort of mimics what is happening to average American incomes: technically, wages continue to go up, but the average still factors in both Bill Gates and Warren Buffett .......
I invite anyone to go out there and tell that 1/3 of African American kids who wanted a job this summer that didn't get one (many who, statistically speaking, actually NEEDED the job to help support their families) and you tell them the unemployment rate "isn't so high". I dare you.
When you disaggregate the "unemployment rate" and even if you disregard all the reasons that it is already a mythical number (which many folks have discussed) it is clear that the only way one can describe the unemployment rate as "not so high" is as if one assumes that one is something other than Black, Brown or young. If you're not one of those others? Well, I guess as the youth might say: sucks to be you.