# Economic Indicators: Unemployment Rate – January 2012

Economic Indicators:  Unemployment Rate –  A Look Behind the Numbers.

From the Bureau of Labor statistics.

A                         B                           C                      D                   E

 2007 231,867,000 153,124,000 7,078,000 4.6% 2008 233,788,000 154,287,000 8,924,000 5.8% 2009 235,801,000 154,412,000 14,265,000 9.2% 2010 237,830,000 153,889,000 14,825,000 9.6% 2011 239,618,000 153,617,000 13,747,000 8.9% Dec-2011 240,584,000 153,887,000 13,097,000 8.5%
 www.bls.gov/web/empsit/cpseea01.htm

Column A = Year or Period

Column B = Non-institutionalized Americans in Civilian Population ages 16 – 65

Column C = American Civilian Labor Force

Column D = Number of Americans Reporting They Are Unemployed

Column E = Calculated Unemployment Rate

Commentary:

Did the unemployment rate reported for December 2011 really decrease? Yes.

Better question – Why?

Answer – Because over 5 million otherwise eligible people, since 2009, are not included in the official unemployment rate calculation as they are likely too  discouraged to look for employment, and have withdrawn themselves from the Civilian Labor Force.

Proof:

During the ten-year period from 2000 – 2009 the Civilian Labor Force (column C) averaged a utilization rate of 66.3% (column C divided by column B) of the eligible Americans. Today, as of January 2012, only 64.0% of the eligible population are actually seeking employment, or 2.3% less. This difference of 2.3% means that 5,533,432 fewer Americans are seeking employment because they are too discouraged to look for a job. If they were included in the calculation, then the Unemployment Rate would skyrocket to 12.1%.