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  • Unemployment Rate Drop Due to Workers Leaving Labor Force

    The November employment report appeared to be good news. The unemployment rate fell to 7.7 percent, the lowest level since 2009, and the economy created 146,000 jobs. However, a closer reading of the details shows that the labor market is not recovering any faster but instead continuing its long, painful march to full recovery.

    The only reason that the unemployment rate fell was because more people dropped out of the labor market than actually found jobs. The labor force declined by 350,000 and the labor force participation rate, a measure of potential workers, declined to 63.6, the same level as reported in September. The recovery is well underway, yet potential workers continue to remain on the sidelines and out of the labor market. One reason is that approximately 1.5 million more potential workers are on the disability rolls now as compared to 2007. It is doubtful that many of them will ever return to the labor force, lowering future economic growth.

    The 146,000 new jobs being created are positive, but the good news is tempered by downward revisions to previous months of 45,000. The economy needs to produce 125,000 new jobs to keep up with population growth. 146,000 jobs are not enough to reduce the unemployment rate unless people leave the labor force. The Federal Reserve Bank of Atlanta’s job calculator estimates it would take five years to reach full employment given the current rate of job creation. This is unacceptable.

    Unfortunately, this report may be as good as it gets. Businesses, both large and small, are delaying expansion and hiring activities due to the concern of higher taxes and the fiscal cliff. The labor market recovery will continue to be slow as bad public policy in Washington, such as these higher taxes, continue.

    Posted in Featured [slideshow_deploy]

    13 Responses to Unemployment Rate Drop Due to Workers Leaving Labor Force

    1. KJinAZ says:

      Unemployment rates dropped because our government is manipulating the numbers. Just who does ghe government think they are fooling with these phony numbers? These people do NOT drop out of the work force. Just because they have been unemployed for a long period does not mean they do not still want to work. These are real people with real families, who would like to have a means of supporting themselves. If you asked most of them they would still consider themselves unemployed. The governments failure to grow our economy is destroying the American dream.

    2. Blair Franconia, NH says:

      It figures. Obama fiddled with the numbers. What would you expect?

    3. Que Dub says:

      73 % of these "created " jobs were goober-ment jobs!!! Worthless to us taxpayers!!!
      So when everyone falls off unemploy benefits & stops looking for a job, the rate will go to maybe 3% , even thought maybe 25 MILLION are out of work???
      AND nobamma will say he turned the economy around!!!
      Folks, we are in a depression !!!!!

    4. Tweety says:

      It's the holiday companies are hiring temp for the seasonal sale after that its gone. Besides counting people who only work one hr to be employ is stupid. Number is not accurate. We are not no where recovering!

    5. W. Page Glennie says:

      You state that it takes 125,000 jobs to keep up with popution growth. Typically each year our country has 4,000,000 births, 1,500,000 deaths, and adds 750,000 immigrants for a population growth of about 2,250,000. That breaks down to about 190,000 a month. So in reality with only 146,000 jobs added we went 44,000 jobs farther in the hole. So if you were to use jobs (a measure of the people's situation) rather then GDP (a measure of Wall Street's situation) as a measure of economic performance, then the economy is still going down, not up, and not stagnate. To send a stronger message about conservative ideas maybe you need to present the facts in a different way. Such as from the perspective of the common man. People can easily understand that not creating enough jobs to keep up with population growth is a bad thing. Few can relate to how GDP relates to their everyday life.

      • johnmac300 says:

        You didn't take into account that some married couples only have one person working. You can't assume that everyone will need to work which is why the number is lower._

    6. foxmuldar says:

      The Jobs report is nothing more then smoke and mirrors. Remember just prior to the election it was claimed that over 800,000 jobs were suddenly created and the unemployment rate magically dropped below 8% just before the election. So how is going from 800,000 to 160,000 considered a plus? Its definitely not and how many of these new jobs are temporary holiday workers. We know that business like UPS and most retailers hire more part time help for the holidays and are quick to let them go once the holiday is over. And whatever happened to the 18,500 workers that Hostess let go? Were they added to the unemployment rolls or will we continue to keep blaming everything on Hurricane Sandy. This weeks numbers got most analyst looking like idiots again. Most were expect a much lower number and were ready to blame it on Sandy. Did they all forget about the holiday hiring? With or without us going over the cliff next year, many companies are already announcing that they will be cutting many of their workers currently working at least 30 hours back to 28 or lower. And others will simply be laying more workers off because of the Obamacare mandates that take effect next year. Well I should say the taxing part of the mandate begins. Its just another form of taxation that will hit the middle class while Obama continues to claim he wants to protect them. I just hope they get hit hard, all those suckers that voted for a Socialist government.

    7. Indigo Red says:

      I lost my job at the end of May 2009 and I knew I'd be laid off with the election of Obama the previous November. My employer and I had talked about what was most likely to occur and it did. I used my 99 weeks of UI while looking for employment. What I learned in my job search was that with the coming Obamacare, I was potentially too costly to hire because of the disability.

      I applied for and was granted Fed disability because I had been born crippled. After many corrective surgeries as a child, I managed to work for most of 26 years as an adult before Obama, but at the same time, my disability was getting more difficult to manage. I hear from disabled friends that they have heard the same reservations from employers.

      Two of the worst things that have ever happened to the disabled community is the ADA and ACA. Without those programs, I'd probably still have a job paying well enough to buy my own medical insurance. Government and the love Liberals have for the less fortunate have essentially destroyed my life and put me in poverty.

    8. Bobbie says:

      Government welfare dependency is another cover. America proves to work and very well when people are self reliant without the bombardment of government interference, impositions intrusions, who's only outcome proves costly, corrupt and counterproductive to people and the economy. Keeping people uncertain makes a crisis easier to bide

    9. Conrad says:

      A grievous error in this report. The 146,000 is not used in the calculation of the Unemployment rate.
      It comes from table A-1 of the BLS.
      http://www.bls.gov/news.release/empsit.t01.htm Table A-1

      Unemployment rate = Unemployed/(Unemployed + Employed) from table A-1

      The 146,000 comes from the Corporate Survey.

      You are comparing apples & oranges.

    10. Dave Erhardt says:

      This unemployment rate is bogus. The real unemployment rate includes those not looking for work, which is above 14%. This bogus unemployment rate is used to make Obama and the Democrats look good. And with the increase in the rates for all at the start of the new year, this bogus rate will even go up. We could head into another recession, even though this economy really never got out of the last one.

    11. Mike, Wichita Falls says:

      LIVs only pay attention to the rate which the regime trends downward for their political gain.

    12. Ron says:

      The labor market is not recovering any faster but instead continuing its long, painful march to full recovery. Full recovery? Are you working for O'bamanation now ?

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