Thoughts on the New Jobs Report
The employment situation report was just issued. The headline for the media: 80,000 jobs created; unemployment rate drops to 9.0%.
The reality behind the headline: in October, the number of workers marginally attached to the labor force or discouraged from joining it rose from 2.51 million in September to 2.56 million in October. These people are not included in the unemployment rate calculation -- though they were included prior to 1994. If one adds those workers to the overall labor force and recalculates, the actual unemployment rate is 10.5%, not 9.0%.
Further, the U-6 (which includes total unemployed, plus person marginally attached to the labor force, plus total part-time for economic reasons and the discouraged workers) came in at 16.2%. This statistic should be considered the true indicator of the health of the job market.
The media is salivating over the unemployment rate getting down to the 8-plus-percent range as a means of resurrecting Obama. However, the average Americans on Main Street no longer believe the statistics promoted by the media -- they can see reality all around them.