UnemploymentData.com

Employment Rate Chart

How Many People are Actually Employed?

Updated 5/04/2012

By Tim McMahon, editor

In Europe they look at the employment rate. How many jobs are actually filled?  A glass half full approach. Here in the U.S. we look at jobs from an Unemployment (glass half empty) viewpoint.

Yes, I admit that it is important to know what percentage of the population wants to work but can’t find a job. But the problem is the tracking. When the government tracks the unemployment rate the number is subject to all kinds of variations.

Current  Employment Commentary:

The U.S. Bureau of Labor Statistics has released its preliminary estimates for the employment situation for the month of April 2012. They have also released their “Seasonally Adjusted” Unemployment numbers which fell slightly since last month from 8.2% in March to 8.1% in April and that was down from 8.3% in February .  By comparison the “Unadjusted Unemployment Rate” (U-3) looks absolutely fantastic falling from 8.4% last month to 7.7% this month. But before we get too excited, lets look at the actual number of people with jobs.

From the table above we can see that employment in April was 132,967,000 compared to 132,071,000 in March for a net increase of 896,000 jobs. That is very good until we look back at the end of 2011 and see that Aprils employment number is almost identical to the employment last December. Ah, you might say but December is known for having higher than normal employment due to all the extra help hired for Christmas. But if you look you will see that November employment was actually higher than December so employment actually declined in December rather than rising. Plus we are still below November’s employment numbers. So yes employment is improving but probably not as much as the unemployment numbers would have you believe.

You might also be intrested in the article Is the Government Fudging Unemployment Numbers? where we can compare unemployment numbers independantly collected by the Gallup polsters to the numbers the Bureau of Labor Statistics are feeding us. According to Gallup’s current unadjusted numbers the Unemployment rate is 8.3% not 7.7% or even 8.1%.

A picture is worth a thousand words, so here is the current chart on a monthly basis since the year 2000. Notice that the trend over the last few months has been generally upward (more jobs) but there was a sharp drop in January contrary to what the “Seasonally adjusted Unemployment Rate” would have you believe and we are still nowhere near the employment levels of 2007-2008 and the population has increased in the mean time.

*Total Non-Farm Employment Not Seasonally Adjusted Rate

Note: The Employment rate and the Unemployment rate are based on two entirely different surveys but theoretically they should be two sides of the same coin. If you look at the chart above it does look like the employment rate is climbing i.e. more people are getting jobs as the trend channel does seem to be up. Although we did see a slight drop in the number of jobs in December and a sharp drop in January compared to November. So what does that say about the supposed Christmas hiring if jobs actually decreased in December?

To determine the employment rate the U.S. government surveys 390,000 businesses nationwide every month. The raw number is what we use here and it is not  seasonally adjusted. This number is considerably more reliable than the 60,000 households that they survey to obtain the unemployment rate. And I prefer it to the seasonally adjusted number. This survey is submitted by the businesses monthly based on company employment on the 12th of the month.

By looking at the employment rate we will know how many jobs there are in our economy, pure and simple. (As Detective Joe Friday in Dragnet would say, “Just the facts Ma’am”). Are there more jobs than last year? Good! Are there fewer jobs than last year? Not good. Simple as that! There is of course the population factor. If the number of jobs stays the same but the population increases drastically then the unemployment rate will rise even though the number of jobs stayed the same. So looking at the unemployment rate is also important. Unfortunately, it still doesn’t give us the full picture. If the U.S. population is growing (and it is) but the number of jobs only holds steady the number of people without jobs will increase. So in order for the real unemployment rate to stay the same the number of jobs has to increase at at least the same rate as the population. If the number of jobs increases at anything less than that rate the unemployment rate will be increasing.

Looking back we can see that when Obama was elected in November 2008 there were 136.288 Million jobs so we are still roughly 3 million jobs below that level but the overall population has increased.

But the data shows 1.895 million more employed in April 2012 than in April 2011 so that is good.

See Current Unemployment Rate for an explanation of how the government calculates the official Unemployment rate.

For more information See:

Historical Employment Data Chart

Current Unemployment Rate Chart

The Misery index measures inflation plus unemployment and is a good measure of the discomfort of the country’s population.