News broke recently that the unemployment rate in America has hit a 5 year low at 6.7% continuing a slow downward trend that has been happening for the past few years. The “glass half full” crowd sees this as a positive sign of our economic recovery, but the “glass half empty” crowd sees this as a negative. They point out that the unemployment rate has dropped not from new hiring going up (which it slowly has been for years and is a factor in the drop) but from people choosing to leave the workforce. This is a half truth, but if you look at the other half of truth, you’ll see why the unemployment rate should actually be around 3%.
The unemployment rate is mainly calculated by people collecting unemployment and who are actively seeking work. So if someone drops off of unemployment benefits, they drop off of the unemployment rate as well. Or if they choose to stop looking for work they are not counted as part of the overall figure. So that’s why you’ve heard so many conservative Obama-haters downplay the drop in unemployment because they feel that if it was calculated differently it would be much higher. But the unemployment rate has always been used as an average baseline and was not intended to be a 100% accurate picture of those who are unemployed. We have historically accepted these flaws and use the overall number for “cheers or jeers” as it goes up & down. But if you want to play the “actual number” game when it comes to the unemployment rate, I would argue that the rate should be about half of what it is now, closer to 3%.
Why? Because the unemployment rate also includes the chronically stupid and unemployable masses. If you disagree, you’ve never been in a position where you have to interview people for a job opening. I have and I’ve also spoken with others who do hiring at their jobs and they agree. About half of the people that come in for a job interview would never get hired because they show up wearing ripped jeans, a baseball hat, a tank-top, they’re chewing gum, have never heard of a resume, and wreak of pot or alcohol. No business would ever hire these people, but they still get counted as part of the unemployment rate. So should the national rate be pushed up and politicians suffer the consequences for people that shoot themselves in the foot by being totally unemployable? Or can we all just except that the unemployment rate is an average and we shouldn’t be playing this “selective numbers game” with it?
But if you’re going to play the game where you argue that the unemployment should be higher because of those that have left the work force or dropped off of unemployment benefits, then you must argue the opposite for those that choose to be unemployable by ignoring “interview etiquette 101”. If not, we should have a national “hypocrisy rate” as well and factor that into all political debates.