So why did the unemployment rate fall to 8.1% in April?

If you look at the BLS Household Survey (the data used to calculate the unemployment rate), the number of people employed fell by 169,000.  The number of unemployed fell by 173,000.  But the number of people "Not in the Labor Force" soared by 522,000.  The unemployment rate can fall either by people getting a job or by them no longer looking for work and thus removing themselves from the labor force.  Those not in the labor force rose by three times the amount of those getting jobs.

The unemployment rate has fallen by 0.9 percentage points in the seven months since September, but during that same period while employment has gone up by 1,758,000, the number of people "Not in labor force" has gone up by 2,206,000.

While the actual number of jobs has now grown by about 1 percent during the Obama recovery, the average for the other recoveries since 1970 has been about 7 percent.

Here is an interesting discussion on the politics of the economy:



Post a Comment

<< Home