The Bureau of Labor Statistics reports that in November, 315,000 people "dropped out of the labor force," while only 130,000 new jobs were added. In other words, the jobs situation took yet another significant turn for the worse. Yet in the unique math practiced by today's BLS - not accounting for those who have dropped out of the labor force in the U-3 unemployment number - that means the our nation's job situation actually improved, on paper only of course. The reality is that we still have "13 million unemployed workers, whose periods of unemployment averaged an all-time high of 40.9 weeks" and that number continues to grow, far outpacing job creation. Nonetheless, the BLS calculates that the unemployment rate dropped from 9% to 8.6% in November, thus leading the New York Times to trumpet:
Update: The broader unemployment number, U-6, which includes the underemployed, is at a staggering 15.6%.
Rush Limbaugh has a colorful rant dealing with both the fraud in the unemployment number and the reaction of the drive-by media to the 8.6% number. Meanwhile, TIME magazine's Stephen Gandell suggests that this drop below 9% could be a "game changer," a sure sign of a strengthening economy. That level of intellectual dishonesty is stomach churning.
That said, not all left of center pundits are intellectually dishonest. My hats off to The New Republic for publishing this Brookings Institution analysis of the current job situation:
Three points are worthy of note.
First: Despite the growth of the working-age population over the past four years, the labor force (roughly, the sum of those employed plus job-seekers) has not expanded. For various reasons, more and more Americans have been dropping out of the labor force. If Americans of working age were participating in the labor force at the same rate as they were at the onset of the recession, the labor force would be nearly 5 million people larger, and unemployment would be significantly worse in both absolute and percentage terms.
Second: Despite the modest economic recovery since the recession ended in mid-2009, total employment remains more than 5.5 million below the level of 2007 and about 1.6 million below where it was when President Obama took office.
Third: To regain full employment (5 percent, which happens to be the same as the level when the recession began) with the pre-recessionary labor force participation rate, we would need 150.7 million jobs—10.1 million more than we have today. That’s a reasonable measure of the hole we’re still in, two and a half years since the official end of the recession.
The American people are unlikely to cheer up about the economy until we get appreciably closer to the top of the hole.
This graph, from Doug Ross, shows the depth of unemployment during this recession in comparison to all of the other recessions since WWII: