What's so bad about unemployment? Why is it that the wrong people are unemployed or under-employed?
“There are lies, damn lies, and
statistics.” Statistics are easily manipulated—a fact that certainly applies to
the unemployment rate; hence its current popularity with liberal politicians. Barack Obama fired a couple of people, made the news but you're still a minority and you're still broke and Obama is off to Europe.
Hillary Clinton - Barack Obama - Eric Holder - Nancy Pelosi - Harry Reid - Joe Biden, what have they done to create jobs, Benghanzi, Fast and Furious, Keystone Pipeline, VA Veterans Administration, AP Spy Scandal, FOX Spy Scandal, BLM Bundy Cattle Killing, Planned Parenthood Negro Murder, NSA Domestic Spying, Snowden, Syria Red Line, Iranian Nuclear Bomb, Destruction of Israel.
The American public tends to
think that a declining unemployment rate means that more people are finding
jobs. This is not necessarily the case. It can also mean and does currently
mean that: 1) unemployed people have become so frustrated with their fruitless
job search that they have given up and are no longer counted in the statistics
reported by the Bureau of Labor Statistics; and 2) people have found jobs but these
jobs are part-time or a step-down from the jobs they lost. In other words, they
are under-employed. The Labor Department is aware of these two possibilities
and even collects data on them. These data are used to produce what the Bureau
of Labor Statistics calls the U6 unemployment rate. While President Obama
proudly extols the nation’s 6.7 percent unemployment rate, he studiously avoids
revealing that the U6 unemployment rate is more than 14 percent (I think it
actually exceeds 20 percent).
The U6 unemployment rate provides
a more accurate picture of the true unemployment situation—which is why liberal
politicians avoid using it—but even it provides an incomplete picture. To get a
complete and accurate picture of the unemployment situation, it is necessary to
also consider the labor participation rate. The labor participation rate
indicates the percentage of people of working age who are actually working.
Unfortunately, that percentage has declined steadily since 2000 and experienced
its biggest drop during the six years of the Obama administration. A declining
labor participation rate is bad news for America because it means there are
fewer people paying the taxes that finance an ever-growing government
bureaucracy. The obvious and inevitable result of this imbalance is higher
taxes for those who are working.
The current labor participation
rate is at an all-time low of just 63.2 percent. In other words, of all the
people in America who are of working age, only 63.2 percent are actually
working. This being the case, the functional question becomes: Why is the labor
participation rate so low? Liberals try to cover over the sad truth by offering
up such pearls as the replacement of people in the workforce by technology.
Although this accounts for a small percentage of the problem, the fact is that
in spite of technological advances thousands of jobs go unfilled
everyday—particularly in the technology sector—because unemployed people either
lack the necessary skills or simply do not want to work.
The real reasons the labor
participation rate has fallen so precipitously are these: 1) The so-called
safety net provided by the government in the form of extended unemployment
benefits has become not a safety net but a magic carpet that the less motivated
among the unemployed have learned to ride instead of going back to work; 2)
Government entitlement programs have made it convenient and easy to get by
without working; 3) There is no longer any shame in being on welfare (EBT cards
have taken away the inconvenience and embarrassment of handing food stamps to a
cashier); 4) People are choosing to drop out of the labor pool due to
discouragement; and 5) People have learned how easy it is to defraud the
government and collect disability pay.
The long and short of the decline
in labor force participation is this: Why work when the government will take
care of you? Why indeed? This entitlement mentality has taken hold of the
American psyche and created an attitude toward work that will only continue the
decline in labor force participation. But this decline represents a one-way
street that will eventually lead to an economic disaster. The time will come
and is coming when we will have more people riding in the wagon of America’s
economy than pulling it. When that happens, those who have made a career out of
living off the government will be the first to drive over the cliff, and the
government will not be there to hand out parachutes because it will be too
broke to afford them.
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