When is good news really bad news? The unemployment rate just dropped from 8.3% to 8.1% of the workforce. That must be good news? Nope!
The latest monthly Jobs Report, prepared by the Department of Labor, was issued this morning. Economists were expecting about 125 thousand new jobs to be created last month. Instead, it was only 96 thousand. Once again, economists merely laugh at their embarrassment.
The reason that the unemployment rate fell is that the workforce shrank. 368 thousand people gave up last month. They're not receiving any unemployment benefits. They're no longer part of the workforce, making the total workforce smaller -- small enough that the unemployment rate of that workforce actually decreased. And, they're NOT laughing at their embarrassment.
In fact, the labor force participation rate or the percentage of working-age people who are actively working (full-time & part-time) plus those looking for work has dropped to barely 65%, which is a 30-year-low. That means one-out-of-three working age Americans is a student, a homemaker, or a drop-out. That's historic. What is the value of the work those people NOT doing?
I have an old friend who was a high-flying marketing executive until he lost his job in Atlanta over three years ago. Since then, he has lost his house. His family has left him. He got a minimum-wage retail job for awhile but lost it. I suspect he lost that job because he started drinking heavily. I lost contact with him and, about a month ago, called his parents. They have also lost contact with him and are worried to death about him. They're not laughing either. I didn't know what to say, other than I'm sure he'll show up . . . I hope!
I assume he is out-of-the-workforce, that he is no longer "participating" and is no longer counted. I suspect he feels like he no longer counts at all. I'm confident he is not laughing.
Despite all the numbers issued by the DOL each month, they don't tell the full story of our lousy unemployment market. It is more than a mere political football. How will we re-integrate millions of people back into the workforce who have lost their jobs, their identify, and their self-esteem? They sound like damaged goods to me, almost some type of economic PTSD. I wouldn't hire them, who would?
So, what's the good news? No matter how bad it is, it could always be worse? That is right, isn't it?
