Sunday, March 10, 2013

The Chart That Proves Mainstream Media Is Lying To You About Unemployment

Michael Snyder
Activist Post

The mainstream media is absolutely giddy that the U.S. unemployment rate has hit a "four-year low" of 7.7 percent. But is unemployment in the United States actually going down? After all, you would think that it should be. The Obama administration has "borrowed" more than 6 trillion dollars from future generations of Americans, interest rates have been pushed to all-time lows, and the Federal Reserve has been wildly printing more money in a desperate attempt to "stimulate" the economy. So have those efforts been successful?

Well, according to the mainstream media, the U.S. unemployment rate is falling steadily. Headlines all over the nation boldly declared that "236,000 jobs" were added to the economy in February, but what they didn't tell you was that the number of Americans "not in the labor force" rose by 296,000. And that is how they are getting the unemployment rate to go down - by pretending that huge numbers of unemployed Americans don't want jobs. 

Sadly, as you will see below, the truth is that the percentage of working age Americans that have a job is just 0.1% higher than it was exactly three years ago. And we have not even come close to getting back to where we were before the last economic crisis. For example, more than 146 million Americans were employed back in 2007. But today, only 142.2 million Americans have a job even though our population has grown steadily since then. So where in the world is this "economic recovery" that they keep talking about?

At this point, the "unemployment rate" has become so meaningless that it really isn't even worth paying much attention to. If you really want to know what the employment picture looks like in the United States, you need to look at the employment-population ratio.

As Wikipedia tells us, many economists consider the employment-population ratio to be far superior to other measurements of employment...
The Organization for Economic Co-operation and Development defines the employment rateas the employment-to-population ratio. The employment-population ratio is many American economist's favorite gauge of the American jobs picture. According to Paul Ashworth, chief North American economist for Capital Economics, "The employment population ratio is the best measure of labor market conditions." This is a statistical ratiothat measures the proportion of the country's working-age population (ages 15 to 64 in most OECD countries) that is employed. This includes people that have stopped looking for work.
A chart of the employment-population ratio in the United States over the past several years is posted below...

As you can see, the percentage of Americans with a job fell from about 63 percent to below 59 percent during the last economic crisis. Since that time, it has not risen back above 59 percent. This is the first time in the post-World War II era that we have not seen the employment rate bounce back following a recession. At this point, the employment-population ratio has been below 59 percent for 42 months in a row.

Yes, we should be thankful that things have stabilized, but as you can see there has been no recovery. The percentage of Americans with a job is essentially exactly where it was three years ago. Despite the trillions of dollars that the U.S. government has borrowed, and despite the reckless money printing that the Federal Reserve has been doing, the employment situation in the U.S. has not turned around.

Data for the employment-population ratio from the beginning of 2008 is posted below...

2008-01-01 62.9
2008-02-01 62.8
2008-03-01 62.7
2008-04-01 62.7
2008-05-01 62.5
2008-06-01 62.4
2008-07-01 62.2
2008-08-01 62.0
2008-09-01 61.9
2008-10-01 61.7
2008-11-01 61.4
2008-12-01 61.0
2009-01-01 60.6
2009-02-01 60.3
2009-03-01 59.9
2009-04-01 59.8
2009-05-01 59.6
2009-06-01 59.4
2009-07-01 59.3
2009-08-01 59.1
2009-09-01 58.7
2009-10-01 58.5
2009-11-01 58.6
2009-12-01 58.3
2010-01-01 58.5
2010-02-01 58.5
2010-03-01 58.5
2010-04-01 58.7
2010-05-01 58.6
2010-06-01 58.5
2010-07-01 58.5
2010-08-01 58.5
2010-09-01 58.5
2010-10-01 58.3
2010-11-01 58.2
2010-12-01 58.3
2011-01-01 58.3
2011-02-01 58.4
2011-03-01 58.4
2011-04-01 58.4
2011-05-01 58.4
2011-06-01 58.2
2011-07-01 58.2
2011-08-01 58.3
2011-09-01 58.4
2011-10-01 58.4
2011-11-01 58.5
2011-12-01 58.6
2012-01-01 58.5
2012-02-01 58.6
2012-03-01 58.5
2012-04-01 58.5
2012-05-01 58.6
2012-06-01 58.6
2012-07-01 58.5
2012-08-01 58.4
2012-09-01 58.7
2012-10-01 58.7
2012-11-01 58.7
2012-12-01 58.6
2013-01-01 58.6
2013-02-01 58.6

So is there anyone out there that still wants to insist that the employment picture in the United States is getting significantly better?

Anyone that wants to claim that "unemployment is going down" should at least wait until the unemployment-population ratio gets back up to 59 percent. Otherwise they just look foolish.

Yes, the Dow is at an all-time high right now. But a bubble is always the biggest right before it bursts.

Most Americans understand that the Dow has been pumped up with all of the funny money that the Fed has been printing. Most Americans understand that the stock market really does not accurately reflect the health of the U.S. economy as a whole.

Just consider these numbers...

-The number of homeless people sleeping in homeless shelters in New York City has increased by 19 percent over the past year.

-The number of Americans on food stamps has risen from 32 million to 47 million while Barack Obama has been in the White House.

-According to the U.S. Census Bureau, more than 146 million Americans are either "poor" or "low income" at this point.

-Median household income in the United States has fallen for four consecutive years.

No, the truth is that everything is most definitely not fine.

If everything is fine, then why did the Federal Reserve inject another 100 billion dollars into foreign banks during the last full week of February?

The U.S. government and the Federal Reserve are desperately trying to prop up the entire global economy. Unfortunately, the global financial system has been built on a foundation of sand and the tide is coming in.

Back in 2008, a derivatives crisis was one of the primary causes of the worst financial panic since the Great Depression.

So did we learn our lesson?

No, the boys on Wall Street are back at it again as a recent article by Jim Armitage described...
Historically, stock markets, being driven by humans, have tended to have a similar length memory of catastrophes, before making the same dumb mistakes again. 
But it hasn't even been five years since derivatives (on that occasion based on daft mortgages) blew up the world, and yet these exotic creatures have already returned. With a vengeance. 
Research from Thomson Reuters declared that banks were creating more derivatives known as asset-backed securities than at any time since before the Lehman Brothers crash. Of those, 22 percent were made up of – and forgive me the alphabet soup here – CDOs and CLOs. The very type of derivatives that exploded last time. At this stage last year, only 6 percent fell into those categories. 
In other words, banks are creating more of the riskiest types of the riskiest products.

At some point, we will have another derivatives crisis even worse than the last one.

When that happens, financial markets all over the globe will crash, economic activity will grind to a standstill and unemployment will go skyrocketing once again.

But, as you saw above, we have never even come close to recovering from the last crisis.

So you can believe the mind-numbing propaganda that the mainstream media is trying to feed you if you want. Unfortunately, the reality of the matter is that we have not recovered from the last major economic crisis, and another one is rapidly approaching.

I hope that you are getting ready.

This article first appeared here at the Economic Collapse Blog.  Michael Snyder is a writer, speaker and activist who writes and edits his own blogs The American Dream and Economic Collapse Blog. Follow him on Twitter here.


This article may be re-posted in full with attribution.


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Anonymous said...


"Obama administration has "borrowed" more than 6 trillion dollars from future generations of Americans" Really? the executive branch is not in control of the purse string in America. It is the US congress that control spending. So state that Obama spent than money is a flat out lie.

If naming names and telling the truth is the gamethan the Federal Reserve having essentially given away to its friends and business associates well over 20 TRILLION DOLLARS ARE TO BLAME. The FED an illegal, unregulated private banking cartel has bankrupted our country--Not the President or even the Congress. Good grief

Anonymous said...

yes perhaps another market collapse will occur. And if it does, it will occur according to their timing and plans.

I think you know who I'm referring to.

It really doesn't matter whether it happens or not. Those that understand the situation for what it truly is, realize that we're FUCKED.

And nothing on THIS planet will be able to stop it.

abinico said...

Blah, blah, blah - yet another useless economic article. Tax the rich; pass a transaction tax on Wall St (a nice, fat, hefty one); tax the rich. Utility theory is quite clear on this - to stimulate the economy take money from the rich and give it to the poor who will not only spend it, but their type of spending has a huge multiplier effect compared to the spending of the rich.

Anonymous said...

How much does the US Government pay the Federal Reserve for each dollar they print and put into circulation???
The Fed funds for banks overnight funds is very low as you can tell by anysavings you may still have in a bank. It doesn't even keep up with inflation, so you are loosing money by leaving funds in a bank..

Hide Behind said...

The amount of jobs has increased but not as fast a it needs to. Obvious and thet has been the true state since Bill Clintons presidency and clear back to the happy damn near full employment days of Vietnam.
Lots of unskilled, and worthless skills,as well as completlyworthless skills out there that no one needs.
At the rate skilled jods are coming open and being filled it is very likely the aRchitects of the past 30 year economy have done one marvelous job
FORr almost 40% of people employed today at no matter their income level they have little at all to worryabout as they are the core of new economy.
Well not realy but they will hold their position in life untilthe next grneration hits then enmasse..
Many will see their dollars dwindle and lose jobs especially within govrrnment that will never come back.
That is to say 40% of we the people are not worth the powder to blow us to hell. The wasted generation is what a soc sci prof calls us. But it is necessary to trash and remove fromyhenew society being nuolt.
DON' t be surprised the damn stuirs conclusions that are bearing out toay were in public domain.
OF COURSE the flag wavers loved wars and they got them.everybody loved drugs and for 10 years cocaine was the US largest industry and it almost singlehandily fueld the dot com party and the warriprs partys as well and both coke and military. Along with social programs for every woman and child in the landrealestate bubble.
The 30 to 40% who are employedingov and their ass kissing positions can and will be ably taken care ofw and remain employedno matter how much pain 60% of us are in.

Anonymous said...

The monetary system is a fraud

Debt Money Tyranny Exposed (with solutions)

The political system and media system is a fraud:

It is absolutely true that the lower house of congress is responsible for spending.


The media lie is that all these people aren't on the same team screwing the American people on behalf of the Debt Money Tyrants they empower and protect from prosecution even when they commit incredible societal damaging crimes.

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