On Thu, 2009-03-19 at 15:14 -0400, Nicole Woo wrote: > [...] The report, "Is the U.S. Unemployment Rate Today Already as High > as It was in 1982?," adjusts the current unemployment rate to account > for demographic and statistical differences that lower the > unemployment rate today by 1.4 percentage points, relative to the > official unemployment rate in 1982. After these adjustments, the > current unemployment level rises to 9.5 percent, a level that is close > to the 1982 average of 9.7 percent. > > "After accounting for these demographic and statistical differences, > today's unemployment rate rises to 9.5 percent, already on a par with > the worst recession since the Great Depression," said Schmitt. [...]
This report, already alarming, fails to honestly inform the public of the misleading nature of the unemployment measure. If we look at the situation a significant fraction of the population, that is "prime age men" in the range 25 year to 54 years old and compare the official BLS statistics between 1982 and 2008 we see the following relative to the civilion non instituional population of this sex and age group: In 1982 the average employment level was 86.5%, unemployment level was 7.5% and inactive level was 6.0% (total 100%), so total "without work" of 13.5% In 2008 the average employment level was 86.0%, unemployment level was 4.5% and inactive level 9.5% (total 100%), so total "without work" at 14%. We see a huge swing in the unemployment measure, whereas the obviously more reliable "without work" level is already worse in 2008 than 1982 on year average. If we take a monthly measure the "without work" level was 15% in december 1982 (highest of the year) vs a never reached before level of 16.4% in december 2008, a full 1.4% above. No need for complex statistical adjustments to see that: 1/ the unemployment measure is totally unreliable for time based comparisons 2/ when looking at a more reliable measure we see the situation was already worse in december 2008 than in 1982 and has probably moved in the wrong direction since then. I hope in the near future the CEPR will use its communication channels to truly inform the public, and point out the extraordinary fact that in the past 3 decades not even one paper from the economist community has come out looking at those striking facts. Sincerely, Laurent GUERBY http://guerby.org/blog _______________________________________________ pen-l mailing list [email protected] https://lists.csuchico.edu/mailman/listinfo/pen-l
