On Friday, news outlets all over America celebrated the fact that the U.S. economy added 173,000 jobs in August.
We were told that the unemployment rate has fallen to a seven year low and that wages are going up. So everything must be getting better for the middle class, right?
After all, isn’t that what the official numbers are telling us?
The financial markets are buzzing over this news because the unemployment rate has fallen into a range that the Federal Reserve has typically considered to be “full employment”, so there is an expectation that the Fed may raise interest rates shortly.
The following comes from Business Insider…
The unemployment rate fell to 5.1% in August, the lowest since April 2008. This was lower than forecast, and put the measure in the middle of the 5.2% – 5.0% range the Federal Reserve considers to be “full employment.” The economy added 173,000 jobs, below the expectation for 217,000, although August payrolls are usually revised higher. We also saw some wage growth, with average hourly earnings rising 0.3% month-on-month, and 2.5% year-over-year. The payrolls gain for July was revised up to 245,000 from 215,000.
But do we actually have anything close to “full employment” in this country?
Of course not.
The truth is that the only way they have been able to get the official “unemployment rate” to steadily go down over the past few years is to eliminate hundreds of thousands of Americans that are chronically unemployed from the official labor force numbers every month. Jim Quinn elaborated on this very eloquently in one of his recent articles…
Now for the plunge in the unemployment rate. That comes from the household survey. The fact is that 220,000 more Americans entered the work force in August. According to this survey, 196,000 more Americans were employed. In the real world this would result in the unemployment rate going UP. Not in the Bizarro world of the BLS. They expect the peasants to believe that 261,000 Americans, of their own free will, voluntarily left the workforce in August because they don’t need a job to pay the bills, feed themselves, and keep a roof over their heads. The idiocy of this ridiculous assumption is breathtaking to behold. Only an Ivy League educated economist, CNBC shill, or complete and utter moron could believe this drivel.
At this point, the percentage of Americans that are actually considered to be “participating in the labor force” is the lowest that it has been since 1977.
According to the Obama administration, more than 94 million working age Americans are “not in the labor force”, and so they don’t count as being unemployed…
A record 94,031,000 Americans were not in the American labor force last month — 261,000 more than July — and the labor force participation rate stayed stuck at 62.6 percent, a 38-year low, for a third straight month in August, the Labor Department reported on Friday, as the nation heads into the Labor Day weekend.
Personally, I believe that the civilian employment-population ratio provides a much more accurate picture of the employment situation in this country. It is a measure of the percentage of the working age population that actually has a job.
As you can see from the chart below, the percentage of working age Americans that are actually working has barely risen from the depths of the last recession…
Does that look like an “employment recovery” to you?
It sure doesn’t to me.
According to John Williams of shadowstats.com, if honest numbers were being used we would actually have an unemployment rate of 22.9 percent in this country.
But if the mainstream media reported that number, everyone would be talking about a “Great Depression” and we would all be complaining about what a horrible job Obama was doing.
Sadly, the cold, hard truth is that the U.S. economy has been collapsing for a very long time.