Bush's Good Economy

[Birthmark]

In a discussion on another board I was forced to prove that the economy is bad. I think that I may have stumbled onto something rather odd. The unemployment rate is supposed to be down, but I can't figure out how.

Civilian Labor Force (Number in thousands)
2001 - 143787
2004 - 146471
Increase = 1.87%

Employed (Number in thousands)
2001 - 137790
2004 - 138301
Increase = 0.37%

Unemployed (Number in thousands)
2001 - 5997
2004 - 8170
Increase = 36.23%

Not in Labor Force (Number in thousands)
2001 - 70101
2004 - 75886
Increase = 8.25%

This is intersting, isn't it? The number of civilians in the labor force increased by <2%; the number of employed barely increased at all; the number of UNemployed jumped by 36%; the number not in the labor force increased over four times as fast the labor force; yet, the contention is that the unemployment rate is down and that the economy is good? It seems to me that with the only way to drive down the unemployment rate is to have the rate of those employed rise *faster* than the rate of the labor force.

Now, for comparison let's set that against the same data for the 1994- Dec. 2000 period.

Civilian Labor Force (Number in thousands)
1994 - 130596
2000 - 143273
Increase = 9.71%

Employed (Number in thousands)
1994 - 121966
2000 - 137632
Increase = 12.84%

Unemployed (Number in thousands)
1994 - 8630
2000 - 5641
Increase = -34.64%

Not in Labor Force (Number in thousands)
1994 - 65357
2000 - 70463
Increase = 7.81%

Please note that the increase in those employed increased faster than the labor force; and that the labor force increased faster than the not in labor force; and that the number of unemployed plummeted. These are the right conditions for a declining unemployment rate.

Have I done the math right? Have I missed something? Can one of you economic whizzes show me where I am wrong or reassure me that I'm right, please? Thanks.

(All statistical data is from the Bureau of Labor Statistics)

[ronatchig]

1. Not a whiz but

You're numbers show that Bush is apparently getting what he wants. A large hungry labor pool willing to forego decent pay, good benefits,and human rights on the job. After all if the country were to experience full employment would not the job candidate have leverage in the job market? Would critcal employees not have the option to go to greener pastures? Sadly for most, this one of the Rethug agenda items that has been quite successful

[Birthmark]

2. Thanks, that's pretty much my view, too.

[seasat]

3. I'll tell you what makes it clear to me.

These charts.






I tend to take the household survey with more caution since the error in it depends on the accuracy of the estimate of current US population growth. However, when used as a ratio (employment or percent of population employed) its pretty accurate since you factor out some error.

My pretty worthless opinion on the economys is this. During the '80s we went through a boom period that benefited the higher income earners. There were plenty of jobs but growth in wages for the lower 40% of the population was especially slow. The result was two income families. During the '90s the income level for the bottom 40% took off and they actually saw real growth in wages and the jobs were especially plentiful. Now we're back under a Republican president and the wages are stagnant for the working and the jobs are stagnant. Strangely enough, during both Reagan and Shrub they lowered the rates on the top salaries. It demonstrates how trickle on theory works.

[Birthmark]

4. Thanks.

What a great site that is! I'd never seen it. I'll be using that one. You're right. A graph is sooooo much better than verbiage.

[Beetwasher]

5. Thank You

Those graphs are terrific...