News on the job market and the slow decrease of the unemployment rate has sent mixed feelings surging through the country. On one hand, there are experts saying that the job market is improving and that, although we have much to accomplish still, we are getting better. On the other hand, there are experts saying that the jobs report statistics weren’t 100 percent real and that the number of working-age people in the labor force has reached its lowest level in 29 years. What are we to believe?
It’s not a matter of believing, but rather a matter of reading and gathering the hardcore facts so you can form your own opinion. Bloomberg recently posted an article that discussed the January jobs report from the Bureau of Labor Statistics. While it was greatly publicized that there were 243,000 jobs created, the fact that the number of working-age people actually in the workforce fell to a near 30-year low wasn’t discussed as much, if at all. In the jobs reports, the BLS reported that the working-age population increased by 1.51 million people but nearly 83 percent of them weren’t in the labor force. This shows that as the working-age population continues to grow, the amount of jobs available to them remains stagnant, leaving many more than before unemployed.
The increase of the working-aged population not in the workforce caused the participation rate of those in the workforce to reach 63.7 percent in January- the lowest it has been since May of 1983. More specifically, Bloomberg sites that 88 million people aged 16 years or older did not have a job and were not trying to find one. If some of these people attempted to find jobs, the unemployment rate would no doubt increase to the high levels we saw only a couple months back.
Spark News has discussed before that the decrease of the unemployment rate is not the best way to judge the job market and its health. Federal Reserve Chairman Ben S. Bernanke was quoted saying almost the same thing. “It is very important to look not just at the unemployment rate. The 8.3 percent no doubt understates the weakness of the labor market in some broad sense. Some people are leaving the workforce because they can’t find jobs, and others are taking part-time jobs because they can’t find full- time employment.” So as the unemployment rate may be decreasing, it doesn’t necessarily mean that the job market is faring any better than before.
Rather than focus on the unemployment rate, Bernanke believes that we should be taking actions to increase the employment growth. He’s definitely not the only one that feels this way. Just yesterday, Spark News discussed how important jobs creation was to American voters and how it will likely make or break a presidential candidate. No matter how low the unemployment rate is, if people are still not finding the jobs they need they are not going to be happy or satisfied.