The Real Unemployment Rate: 21.5%
If you’re only paying attention to President Obama, the Bureau of Labor Statistics and the mainstream media, you’d think that the employment situation in America was getting much better.
The BLS reports that the unemployment rate dropped from 9.7% in May to just 9.5% in June. The recovery is well under way if you’re simply looking at headlines.
The fine print, however, tells a different story.
First, for those unaware of what the 9.5% reported rate for June means, it’s referred to by the BLS as the U3, or, the “official” unemployment rate. Here’s a basic definition of the U3:
The official definition of unemployment used by the BLS includes anyone age 16 or older who is not institutionalized and is not currently employed, but able to work, available for work, and actively seeking work.
The official definition of unemployment also excludes certain groups who are sometimes thought of as being unemployed or “underemployed.” Those who would like to work, but who have stopped looking for work – so-called discouraged workers – are not counted in the official definition because they are not actively seeking work. People working part time who would prefer full-time work are also not counted as unemployed because they are working – albeit fewer hours than they would like.
You can see the problem almost immediately with the “official” numbers touted by Washington and the talking heads on television. Most mainstream news you watch or read will provide information only on the U3.
They stop short of going to the next BLS number, referred to as the U6. According to John Williams, this is how the U6 is defined:
The U-6 unemployment rate is the Bureau of Labor Statisticsâ€™ (BLS) broadest unemployment measure, including short-term discouraged and other marginally-attached workers as well as those forced to work part-time because they cannot find full-time employment.
This month’s U6 unemployment number? Down from 16.6% in May to 16.5% in June.
Remember, though, that even the U6 is a government manipulated number, so we need to look a little bit deeper to see what the REAL unemployment rate is in America.
John Williams of Shadow Stats runs the numbers each month, and according to his most recent report, we’re actually hovering at around 21.5%. According to Williams, this is how the Shadow Stats “SGS Alternative” is calculated:
The seasonally-adjusted SGS Alternate Unemployment Rate reflects current unemployment reporting methodology adjusted for SGS-estimated long-term discouraged workers, who were defined out of official existence in 1994.Â That estimate is added to the BLS estimate of U-6 unemployment, which includes short-term discouraged workers.
Williams’ unemployment numbers are more than double what Washington is telling us.
For those intent on preserving their personal and financial well-being, who are you going to believe?
Will you believe that Government Actions Have Prevented Depression, Financial Meltdown, and Martial Law ?
Or are you preparing for the Greatest Depression and potential monetary and financial chaos yet to come?
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Date: July 2nd, 2010
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