Public Comment

I think that almost all of you already know that the real unemployment rate is substantially higher than the officially reported rate. And I doubt that any of you believe the major economists that our economy now is at full employment and that anyone who wants to work can find a job. So I promise, I won't dwell on what I think you already know. 

What may surprise you is that developments in the economy that have been harmful to working people appear in the official data on the nation's labor force as major improvements. How is this possible? Thanks for asking. 

The federal government's Labor's Bureau of Labor Statistics (BLS), which is a unit of the Department of Labor, reports every month the number of new jobs that are created. According to the BLS, the economy is expanding, which has been creating more opportunities for working people. The agency reported that over 2 million new jobs were created last year. This is a gross, not a net figure. The BLS does not take into account the number of jobs lost due to business bankruptcies and mass layoffs by the major corporations. 

I think you know that the BLS calculation on the unemployment rate excludes the millions of workers who have given up searching for jobs. To be counted as unemployed it is not enough, statistically speaking, to be out of work. Employees must claim that they have been actively seeking jobs within the previous four weeks. When the economy begins to decline, the unemployment rate certainly rises. However, when bad times persist, an increasing number of workers stop looking for work. So they are statistically ignored by the BLS. Until a few years ago over 40 percent of the unemployed were recorded as being long term unemployed, which is defined as being out of work for over six months. Currently, the numbers of long term jobless workers has dropped in half but not because they found jobs. Rather, they have become too discouraged to continue looking. 

Specifically, in early 2,000 the percent of the working age population that was in the labor force -- either working or actively seeking jobs -- was 67.3 percent. By December 2017 the rate has declined to 62.7 percent. Had the current rate remained the same as the 2000 figure, up to about 10 million more workers would have been counted as unemployed. But as a result of the increase in the number of discouraged workers, they are all excluded from the calculations on the unemployment rate. 

Because of the abundance of jobless workers, employers are at a tremendous advantage. In recent years they have been able to convert full-time jobs to part- time positions. In fact, the number of part-time jobs are growing at twice the rate of full-time jobs. There are now over 5 1/2 million workers who are employed part- time because they cannot find full time jobs. The hourly wages of part-time jobs are typically low and most often lack benefits, which explains why the poverty rate is high among part-timers. But the proliferation of part-time jobs looks good statistically because it doubles the count of new jobs. If, say, 100 full-time jobs converted to part time positions, then "presto" - the total count is now 200 jobs. The BLS would certainly be welcomed as a member and even as an officer in any national organization of magicians. 

About full time jobs, the numbers are growing. However, the conventional full-time job is disappearing. As researchers on this issue have noted, an increasing number of full time positions are no longer the traditional nine to five, steady jobs. They are characterized by being temporary and unpredictable. Freelancing is among the growing number of marginal occupations. About 35 percent of the workforce, which is about 53 million "non-employees", are now freelancers. Experts anticipate that in two years freelancers will make up 50 percent of the workforce. 

The reason the number of freelance workers are rapidly increasing is because employers can save money by replacing many of their paid employees. Employers can lay off an employee by dividing the various tasks which are then assigned to several different non-employees at a lower cost and only on a need basis. Unfortunately, many of the millions of these ex-employees have become freelancers because of circumstances rather than choice. The earnings of many freelances are at the poverty level. They are counted as employed even if they rarely receive assignments. For those of us who are more fortunate, the substantial growth in such unconventional jobs is barely noticed. But it is inflicting enormous pain and insecurity on millions of people. Yet since several freelancers are able to replace in small doses the work of one laid off employee, the BLS statistics interprets these "increases" as a very positive development. For the workforce has increased and so have the number of jobs! 

The obvious question is why does the BLS regularly underestimate the serious problems that working people confront? That the business community exerts considerable pressure on government agencies is not the only reason. Neither government nor business could successfully deceive the public if our news media was critical and independent. A free press for the most part would not allow the deceptive and misleading findings that the BLS reports to remain unchallenged.  

What is urgently needed along with good old fashion organizing is producing more newspapers that have the integrity of the Berkeley Daily planet. Doing whatever we can to educate the public on how their interests are being undermined in ways that are not apparent is indispensable.