tag:blogger.com,1999:blog-3448927642739850334.post7725586663330634102..comments2023-10-29T08:06:00.610+00:00Comments on The Political Economist: Understanding unemploymentVuk Vukovichttp://www.blogger.com/profile/01878567452492217960noreply@blogger.comBlogger10125tag:blogger.com,1999:blog-3448927642739850334.post-79378476598761438492012-02-16T20:29:29.635+00:002012-02-16T20:29:29.635+00:00The 'fundamentals' of which you speak stil...The 'fundamentals' of which you speak still aren't all that improving. Rather they are, as I pointed out in the text, still stagnating.<br /><br /><a href="http://data.bls.gov/timeseries/LNS12300000" rel="nofollow">Here</a> is the latest data on the employment-population ratio from the BLS, and to support this here is the <a href="http://data.bls.gov/timeseries/LNS11300000" rel="nofollow">civilian labour force participation rate</a>. While the E-P ratio is stagnating, people are dropping outside the labour force (observe the data in the tables below the graphs), implying more discouraged workers. I would love to see the economic situation in the US improving, but currently, more factors than employment need to be taken into perspective to make that conclusion. It's best to wait until the end of the first quarter to make stronger inferences on the state of the recovery. <br />As for the unemployment rate, the post itself best explains why it tends to be a weaker concept than the E-P ratio to determine the health of the economy. <br /><br />Furthermore, this blog carries no bias, liberal or conservative. It's idea is to provide and analyze facts, from a purely logical perspective. If logical conclusions contradict ones opinion they shouldn't be automatically discarded.Vuk Vukovichttps://www.blogger.com/profile/01878567452492217960noreply@blogger.comtag:blogger.com,1999:blog-3448927642739850334.post-44711174776184393182012-02-16T17:24:01.280+00:002012-02-16T17:24:01.280+00:00So it's a little over a month later and the fu...So it's a little over a month later and the fundamentals just keep improving. Employers are reporting increased hiring. That is decidedly NOT people giving up on looking for jobs. It is actual jobs being created. Sorry conservatives, you're just going to have to deal with the heartache of things improving in our country even though you don't like the president. Awww... poor you.lockewasrightnoreply@blogger.comtag:blogger.com,1999:blog-3448927642739850334.post-67938250193204971502012-01-07T14:43:00.692+00:002012-01-07T14:43:00.692+00:00Again, this tells you that there’s something wrong...Again, this tells you that there’s something wrong with the economy, right? Otherwise they wouldn’t have to choose more college over work. And the ratio captures that yet again – more students driven by necessity out of employment are increasing the non-working population (the denominator) and hence driving down the ratio.Vuk Vukovichttps://www.blogger.com/profile/01878567452492217960noreply@blogger.comtag:blogger.com,1999:blog-3448927642739850334.post-75650826233825376662012-01-07T14:31:04.593+00:002012-01-07T14:31:04.593+00:00Ok, true, but I read (see here, here and here) tha...Ok, true, but I read (see <a href="http://online.wsj.com/article/SB123379511595150185.html" rel="nofollow">here</a>, <a href="http://www.villagevoice.com/2009-01-21/news/the-jobless-head-back-to-school/" rel="nofollow">here</a> and <a href="http://www.usatoday.com/news/education/2009-04-07-bootstraps_N.htm" rel="nofollow">here</a>) that there is actually an increase in the student population over the last couple of years. People (especially young) simply choose to go back to college and not risk being unemployed for too long. They choose to brush up their CV a bit, I guessMikehttps://www.blogger.com/profile/14413273098082958690noreply@blogger.comtag:blogger.com,1999:blog-3448927642739850334.post-68426191285321531192012-01-07T14:12:02.029+00:002012-01-07T14:12:02.029+00:00True, this is a negative side, because of students...True, this is a negative side, because of students it tends to be a bit lower than it actually is.<br /><br />However, when looking at the relative change of the parameter, I don’t believe the students drive the bias that much. Besides, on the graph, there were students in the 90-ies and the 80-ies, so this is something that is constant across the observation and not really significant in explaining the current situation – it’s not like the US universities are experiencing an upsurge of students all of a sudden.Vuk Vukovichttps://www.blogger.com/profile/01878567452492217960noreply@blogger.comtag:blogger.com,1999:blog-3448927642739850334.post-17570526965146956402012-01-07T13:18:04.449+00:002012-01-07T13:18:04.449+00:00Isn’t the employment-population ratio also biased ...Isn’t the employment-population ratio also biased against the fact that many people able to work are students for example, or does it exclude students altoghether?Mikehttps://www.blogger.com/profile/14413273098082958690noreply@blogger.comtag:blogger.com,1999:blog-3448927642739850334.post-84254261880952467742012-01-07T12:34:53.067+00:002012-01-07T12:34:53.067+00:00@derek
thank you for the methodology clarification...@derek<br />thank you for the methodology clarification. A lot of people in the category of 'not in the labour force' and 'don't want a job' are in the 55 years and older category (around half), or are disabled and so on. These categories of people are not included in the total workforce (especially the retired) as measured by the population parameter in the employment-population ratio. But those who want a job and those who became discouraged increased from 2009 to 2010 (as is shown in the table you provided). This is what drove the EP ratio down, and is keeping it down. <br /><br />Let's discuss the long term effects. Do you think that the lower levels of the ratio (a lot of people leaving the workforce) coincided with the unemployment increase during the crisis? Even if it did, we cannot make that assumption now. There simply isn't much information to conclude of a positive or negative trend. The parameter itself (EP ratio) is inconclusive on the trend, but is very suggestive of the situation within the labour force - it's not good as there is no positive change at the moment. If you look at the movement of the ratio at the beginning of 2010 and the beginning of 2011, would you conclude that this is a positive trend? No. That is exactly why you cannot make the same assumption now.Vuk Vukovichttps://www.blogger.com/profile/01878567452492217960noreply@blogger.comtag:blogger.com,1999:blog-3448927642739850334.post-8337512556699930792012-01-07T00:25:18.891+00:002012-01-07T00:25:18.891+00:00Anonymous: The Census Bureau and BLS survey 60,000...Anonymous: The Census Bureau and BLS survey 60,000 households every month as part of the Current Population Survey, asking a bunch of nosy questions including whether folks are employed etc. But the Current Population Survey also asks people who aren't working, why, and whether they current want a job. Most people who aren't working DON'T want a job -- in 2010, of the 83.9 million Americans over the age of 16 who said weren't working, only 6 million <a href="http://www.bls.gov/cps/cpsaat35.pdf" rel="nofollow">said they wanted a job</a>. The rest were retired, disabled, raising kids, in school, etc. <br /><br />Obviously the shaded areas in the graphs were caused by increased unemployment during recessions, but more long-term there's plenty of other things that would effect the employment-to-population ratio: people retiring earlier; retired people living longer; parents becoming more likely to drop out of the workforce to raise children; teenagers becoming more likely to go to college; more people claiming Social Security disability payments, etc.derekhttp://twitter.com/derek7272noreply@blogger.comtag:blogger.com,1999:blog-3448927642739850334.post-72658370851044372662012-01-06T23:37:20.302+00:002012-01-06T23:37:20.302+00:00The ratio compares the total number of employed ov...The ratio compares the total number of employed over the total population including only individuals within the working age. Both parameters are easily measured and published by the Bureau of Labor Statistics. <br /><br />If you're interested in the detailed methodology, check the web page of the BLS:<br />http://www.bls.gov/lau/rdscnp16.htmVuk Vukovichttps://www.blogger.com/profile/01878567452492217960noreply@blogger.comtag:blogger.com,1999:blog-3448927642739850334.post-24507992378808995212012-01-06T20:25:16.861+00:002012-01-06T20:25:16.861+00:00Thank you for this analysis.
Do you know how the...Thank you for this analysis. <br />Do you know how the government measures/estimates the civilian employment-population ratio?Anonymousnoreply@blogger.com