A popular conspiracy theory is spreading in the Trump family. It's totally false.
By Matt O'Brien
Donald Trump listens to the applause of the crowd
Republican presidential nominee Donald Trump gives a thumbs up during his walk through
Cleveland, U.S., July 21, 2016. REUTERS/Rick Wilking
The unemployment rate is not a conspiracy. It is not manipulated by the Bureau of Labor Statistics. And anyone who suggests otherwise is either uninformed, or trying to misinform uninform others.
Which is to say that you shouldn't listen to Donald Trump & Co. For a year now, the alleged billionaire has insisted that the "real" unemployment rate is something like 42 percent instead of the 4.9 percent it actually is. He hasn't said how he's gotten this — maybe this—maybe it's from the same "extremely credible source" who told him President Obama's birth certificate was fake? — but fake?—but the simplest explanation is that he's just ballparking how many adults don't work. That's 40.4 percent right now. The problem with using that number, though, is that it counts college students and stay-at-home parents and retirees as being equally "unemployed" as people who are actively looking for work but can't find any. So it doesn't tell us too much, at least not on its own, unless you think it's a problem that we have more 70-year-olds 70-year olds than we used to.
Or unless conspiracy theories are one of your favorite accessories, asseems to be the case with the father, and now the son, Donald Trump Jr. On Sunday, he told CNN's Jake Tapper that the official unemployment numbers are "artificial" ones that are "massaged to make the existing economy look good" and "this administration look good." How do they supposedly do this? By, he claimed, defining "the way we actually measure unemployment" to be that "after x number of months, if someone can't find a job, congratulations, they're miraculously off" the jobless rolls. off [the jobless rolls]." The only problem with this theory is it's false. The BLS hasn't changed the way it measures unemployment during the Obama years, and there is zero evidence it has changed the numbers themselves. Not only that, but Donald Trump Jr. doesn't even seem to know how unemployment is defined in the first place. As the BLS explains, everyone who doesn't have a job but is trying to find one counts as "unemployed." It doesn't matter how long you've been looking as long as you are, in fact, are in fact still looking.
But that's not to say the unemployment rate tells us everything we need to know about the labor market. It doesn't. Federal Reserve Chair Janet Yellenwill tell you that herself. There are still a lot of people who want full-time but can only find part-time jobs. Still There are still a lot of people who want to work but weren't able to find anything for so long that they've given up looking for now. And still a lot of people who would want to work again if wages were high enough to make it worth their while. But none of this is a secret. The BLS publishes all this, it all too. So-called broad unemployment includes all these people who technically aren't unemployed but aren't fully employed, employed either. That's 9.6 percent today.
Even more damning than that, though, are the millions of people who "should" be working but aren't. Those are the 25- to 54-year-olds 25 to 54-year olds who, for the most part, are too old to still be in school, but too young to be retired. In 2000, 81.9 percent of them worked; in 2007, 80.3 percent did; percent; but only 77.8 percent do today. That adds up to at least 2.5 million missing workers.
Source: BLS
Where have they gone? Well, some of them are probably people who decided to go back to school. Others are probably parents who felt like they had to stay at home since their wages wouldn't have covered the ever-increasing costs of child care. childcare. And the rest are probably people who are still waiting for the recovery to reach them. Indeed, as you can see above, the share of 25- to 54-year-olds 25 to 54-year olds who have a job has only made up half of the ground it lost during the recession.
The boring truth is that the economy is in a lot better shape than it was when Obama took office, but that it could be in better shape still. The recovery, in other words, still has a ways to go. But that's a lot different from saying that we have 40 percent unemployment and that the government is trying to cover it up. That just suggests you don't understand — or don't understand--or want to accurately describe — how describe--how stats work and you don't know how to look up the ones you think the BLS is hiding.
It's not what you'd expect from a major party presidential candidate.
July 26, 2016 at 09:49AM
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