The job numbers are designed to disguise a damaged economy.
We often remind you on this blog not to trust the job numbers. Nothing has changed with the new report last week. CNS News reports, “Labor Force Participation Remains at 38-Year Low; 94,513,000 Not in Labor Force; Unemployment Ticks Down to 5.0%.”
The number of Americans not in the labor force last month totaled 94,513,000 — a slight improvement from the 94,610,000 not in the labor force in September–but the labor force participation rate nonetheless remained at its lowest point in 38 years, with only 62.4 percent of the civilian noninstitutional population either holding a job or actively seeking one.
The Bureau of Labor Statistics says economy added 271,000 jobs in October, well above economists’ expectations of 185,000, and the unemployment rate dropped to 5.0 percent in October from September’s 5.1 percent.
At the Global Economic Analysis blog, Mish reviews the report in detail and warns about the job numbers.
The official unemployment rate is 5.0%. However, if you start counting all the people who want a job but gave up, all the people with part-time jobs that want a full-time job, all the people who dropped off the unemployment rolls because their unemployment benefits ran out, etc., you get a closer picture of what the unemployment rate is. That number is in the last row labeled U-6.
U-6 is much higher at 9.8%. Both numbers would be way higher still, were it not for millions dropping out of the labor force over the past few years.
Some of those dropping out of the labor force retired because they wanted to retire. The rest is disability fraud, forced retirement, discouraged workers, and kids moving back home because they cannot find a job.
If this is a recovery, then what will the next recession be like?