Unemployment Numbers Scam | FrontPage Magazine
By Arnold Ahlert On May 8, 2012 @ 12:50 am In Daily Mailer,FrontPage | No Comments
When the jobs data were released last week, it was revealed that only 115,000 new jobs were created, well below the 165,000 predicted by the media-anointed economic “experts,” and significantly below the 125,000 jobs-per-month pace required just to keep pace with the number of people entering the work force. Yet in an apparent paradox, the unemployment rate dropped from 8.2 percent to 8.1 percent. Presumptive Republican presidential candidate Mitt Romney explains half of it. “There is something about that 8.1 percent figure you ought to know,” he told a crowd at a town hall-style meeting in Cleveland yesterday. “You might assume that that number came down from 10 percent to 8.1 percent because of all the jobs that were created, and that assumption would be wrong. The reason that percent came down was because of all the people that dropped out of the workforce.”
Mr. Romney is correct. Much of the lower number is indeed attributable to the fact that 342,000 Americans gave up looking for work, and those people are no longer counted as being unemployed. Yet there is another, far more ominous element to the paradox that is part of the equation as well: the number of Americans receiving Social Security Disability Insurance (SSDI) has soared.
Since 2010, and directly coinciding with the time millions of Americans used up their 99 weeks of unemployment insurance, disability claims have risen by 2.2 million. And precisely like Americans who have given up looking for work, those receiving disability payments are neither counted as part of the workforce, or part of the unemployed. The rise in the number of claims is daunting. From December 2007 to April 2012, the number of workers receiving SSDI jumped 22 percent, from 7.1 million Americans to 8.7 million. According to economists at JPMorgan Chase & Co. and Morgan Stanley, that figure explains as much as one quarter of the decline in the labor force participation rate.
“How we measure and understand what’s going on in the economy can be influenced by the degree to which various public-support programs are available and being used,” said Michael Feroli, chief U.S. economist at JPMorgan in New York. “With a rising number of disability beneficiaries, there are both lower unemployment rates and lower participation rates.”
That’s an understatement. The latest drop in labor force participation, from 63.8 percent in March to 63.6 percent in April, represents the lowest rate since 1981–fully 31 years ago.
-more at link-
Mr. Romney is correct. Much of the lower number is indeed attributable to the fact that 342,000 Americans gave up looking for work, and those people are no longer counted as being unemployed. Yet there is another, far more ominous element to the paradox that is part of the equation as well: the number of Americans receiving Social Security Disability Insurance (SSDI) has soared.
Since 2010, and directly coinciding with the time millions of Americans used up their 99 weeks of unemployment insurance, disability claims have risen by 2.2 million. And precisely like Americans who have given up looking for work, those receiving disability payments are neither counted as part of the workforce, or part of the unemployed. The rise in the number of claims is daunting. From December 2007 to April 2012, the number of workers receiving SSDI jumped 22 percent, from 7.1 million Americans to 8.7 million. According to economists at JPMorgan Chase & Co. and Morgan Stanley, that figure explains as much as one quarter of the decline in the labor force participation rate.
“How we measure and understand what’s going on in the economy can be influenced by the degree to which various public-support programs are available and being used,” said Michael Feroli, chief U.S. economist at JPMorgan in New York. “With a rising number of disability beneficiaries, there are both lower unemployment rates and lower participation rates.”
That’s an understatement. The latest drop in labor force participation, from 63.8 percent in March to 63.6 percent in April, represents the lowest rate since 1981–fully 31 years ago.
-more at link-
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