Jobless rate hits 9.2 percent in April

Jobs continued to disappear in April, according to the Bureau of Labor Statistics. The official unemployment rate is 5 percent. For the last 5 months, private employment has gone down.

More than 800,000 workers have lost their jobs during the last year. Long term joblessness is deepening. That’s the people who’ve been without a job for more than 6 months. That’s now over 1.3 million workers, more than one in every six unemployed workers. At the current rate, another 3 million will be part of this group of long-term jobless by the end of the year.

“The Labor Department’s most comprehensive alternative unemployment rate measure—which includes people who want to work but are discouraged from looking as well as people working part time because they can’t find full-time jobs—edged up in April and, at 9.2 percent, is nearly two percentage points higher than at the start of the last recession,” says Chad Stone, chief economist at the Center on Budget and Policy Priorities.

What does Stone mean by an alternative unemployment rate?

The Labor Department quietly provides an alternative set of figures to the economists and businesses, but these numbers never make the media reports nor are mentioned by the politicians, Republican or Democratic.

This alternative rate of 9.2 percent includes what they call “discouraged” workers. That’s workers who are not able to actively look for a job because they don’t have child care available or don’t have access to transportation. It does not include those jobless who went into the military because they couldn’t find a job or the 2 million prisoners. For unemployed youth, prison has become the government’s jobs program.

Kevin Phillips, in a report titled “Numbers Racket” in Harper’s Magazine, writes that this alternative index is the real world figure, but that the lower numbers are used to cover up the depth of the economic crisis.

“The real numbers, to most economically minded Americans, would be a face full of cold water. Based on the criteria in place a quarter century ago, today’s U.S. unemployment rate is somewhere between 9 percent and 12 percent; the inflation rate is as high as 7 or even 10 percent; economic growth since the recession of 2001 has been mediocre, despite a huge surge in the wealth and incomes of the superrich,” Phillips says.

Phillips says that this big distortion of the unemployment figures was introduced by the Clinton administration. “Despite the present Bush administration’s overall penchant for manipulating data (e.g., Iraq, climate change), it has yet to match its predecessor in economic revisions,” Phillips writes.

It was the Clinton administration that had long-term unemployed removed from the official count of jobless workers, immediately removing 4 million from the count in 1994. And by removing households in the inner cities from the monthly sample, the Clinton administration made the official unemployment figure go down even more.