One of the drawbacks of “the data-driven era” — LOL! — we supposedly live in is that you can now find numbers to prove pretty much anything you are trying to prove. Unemployment rate is a great example of “This proves the economy is doing super well.” No, it really does not.
Here I shall quote Business Insider, which is hardly a “woke” business publication, but they will do well for my purposes herein. Here’s the article. Pay attention to this →
In March 2006, at the peak of the economic boom that preceded the great financial crisis, involuntary part-time work was at a low of 620,000. It rose to a peak after the 2008 crisis. But today, after 10 years of economic growth, it has settled back to 881,000 — an increase of 42% over the period, according to the ONS.
Four percent unemployment is technically “full employment.” Anyone who wants a job should be able to get one. But 881,000 workers need full-time jobs — the kind that get people out of poverty — and those jobs are not available.
That data is from the United Kingdom. In the U.S., the data is similar, with “involuntary part-time work” being about 40% higher than it should be →
As my man Paul Millerd noted in his newsletter last weekend, and then I subsequently stole for a newsletter of my own, the U.S. “Job Quality Index” shows that, since 1990, we are creating “bad jobs” (relative to income and cost of living) at 2x the rate of “good jobs:”
Point being: there is low unemployment, yes, and that’s an easy stat to look at and say “The economy is doing great!” But the reality is that many are underemployed, involuntarily working part-time, have totally opted out of the labor force because it’s such a cluster-mess, or are working in shitty jobs created so that the seven people at the top of a given company can get richer. The American Dream has been edited.
PS: the United Nations, which is a weird organization whose role is less and less clear in modernity, has a new report about how 470M people are either underemployed or straight-unemployed right now globally, which is “contributing to social unrest.” Amen. Why do you think Trump won in 2016? It’s about people needing jobs for social stability, and jobs disappearing because of globalization and greed, and the promise of those jobs coming back, potentially. It’s all in the … you guessed it … data.
In short, stop discussing unemployment rate. It’s only one mostly-meaningless input to the bigger discussion.