[1rudeboy]

I think there's some truth to that. I believe those people are placed in a class where they are considered to "no longer" be looking for work, thus taken out of the math that determines the unemployment rate. (Retirees fall into this group by default.)

This falsity is becoming a FR myth.

[in hoc signo vinces]

Considering that Roy Ruffin my economics professor in college spoke to it years back...I dont know how much a myth it is.

However, it may not be as much a factor as some my think. I tend to believe the rate is an accurate one and good economic news...not trumpeted by an MSM that hates the current administration.

Thanks.

In Hoc.

[Mase]

This falsity is becoming a FR myth.

Maybe the fact it's being taught in college level economic classes has something to do with the perpetuation of this myth.

This is from the BLS:

Where do the statistics come from?

Because unemployment insurance records, which many people think are the source of total unemployment data, relate only to persons who have applied for such benefits, and since it is impractical to actually count every unemployed person each month, the Government conducts a monthly sample survey called the Current Population Survey (CPS) to measure the extent of unemployment in the country. The CPS has been conducted in the United States every month since 1940 when it began as a Work Projects Administration project. It has been expanded and modified several times since then. As explained later, the CPS estimates, beginning in 1994, reflect the results of a major redesign of the survey.

What are the basic concepts of employment and unemployment? The basic concepts involved in identifying the employed and unemployed are quite simple:

• People with jobs are employed.
  
• People who are jobless, looking for jobs, and available for work are unemployed.
  
• People who are neither employed nor unemployed are not in the labor force.
  

  Who is counted as employed?

  Not all of the wide range of job situations in the American economy fit neatly into a given category. For example, people are considered employed if they did any work at all for pay or profit during the survey week. This includes all part-time and temporary work, as well as regular full-time year-round employment. Persons also are counted as employed if they have a job at which they did not work during the survey week because they were:

• On vacation;
  
• Ill;
  
• Experiencing child-care problems;
  
• Taking care of some other family or personal obligation;
  
• On maternity or paternity leave;
  
• Involved in an industrial dispute; or
  
• Prevented from working by bad weather.

  Who is counted as unemployed?

• Persons are classified as unemployed if they do not have a job, have actively looked for work in the prior 4 weeks, and are currently available for work.

  Who is not in the labor force?

• All members of the civilian noninstitutional population are eligible for inclusion in the labor force, and those 16 and over who have a job or are actively looking for one are so classified. All others--those who have no job and are not looking for one--are counted as "not in the labor force." Many who do not participate in the labor force are going to school or are retired. Family responsibilities keep others out of the labor force. Still others have a physical or mental disability which prevents them from participating in labor force activities.

  BLS FAQ's

I think this is where the misconceptions arise and people begin believing that there are millions of discouraged workers in America who have just given up looking. Why someone who needs a job would not be looking for a job during any given four week period is a mystery. How they would survive is another question.

Regardless, the belief remains that there are a great many potential workers in American who have given up and resigned themselves to permanent unemployment - although the government does not count them as such. Fortunately, NR debunked this myth for us.

The percentage of unemployed people who have given up looking for work is low, by historical standards, and has recently been dropping. We know this, because the Bureau of Labor Statistics, the same agency that counts the number of unemployed people, also counts the number of discouraged workers — or the number of people who have given up looking for work and say they have done so because they believe there is no appropriate work to be found.

Here's what the BLS found: Only about a third of a percent of American workers are classified in the "discouraged" category. That's right: Ninety-nine and two-thirds percent are not discouraged. This is hardly the teeming mass of employment despondency that we have been led to believe is out there.

The Myth of the Discouraged Worker (Have American workers been giving up in the Bush economy?)