Whether or not you agree with this, I believe the unemployment rate is virtually useless as it is enumerated today. First, it counts only those in the unemployment pool who are collecting unemployment. If a worker goes off unemployment they are not included in the unemployment rate. Second, it completely doesn't account for UNDERemployment. An example would be a manufacturing worker (say working for Maytag) who was laid off when their plant closed and who found employment at Wal-Mart for half (or less) of their previous wage. Thus, the implied "employed" percentage contains some components of workers that is living at or below the poverty rate for compensation where they were able to purchase goods and save money prior to becoming underemployed.
I would be happier if the numbers gave the complete picture. Today they don't. That portion of American workers who are employed but employed either part time or at a substantially reduced rate prior to being laid off is an important measure of how we are (or are not) growing economically in a meaningful sense.
Wikipedia has a good jumping off point on the issue of underemployment and its lack of inclusion in the US unemployment rate.
Productivity is misleading because it is reported by Corporations. So, for example, General Motors is an American Corporation which has moved some of its manufacturing to other countries to seucre cheaper labor. So (and I'm making these numbers up), perhaps prior to the move, the average GM laborer in the US made $20 an hour and produced X cars. When the manufacturing moved to a cheaper labor source, X cars are still manufactured but the laborere to produce it costs $10 an hour. Immediately the productivity number goes up while the benefit to the American worker has decreased. This explains how wages can remain flat despite the seemingly low unemployment rate and gains in productivity.
You can ask for sources, but honestly, this is just pure economics. Many think that enumerating underemployment is unnecessary. Many think that productivity is what it is (it's a straight calculation) and shows the health of a Corporation (which I think it does). Yet to use these as a measure of economic well-being doesn't go far enough to provide a true picture.
Sorry to butt in Newland,
Hi again DC,
Your "under-employment" example is hardly fair. Corporate outsourcing is a direct reaction to the cost of labor here due to unions.
No one in thier right mind can suppose that ANY corporation can support almost two generations in retirement and one actual working generation. Ridiculously high wages matched with health packages and retirement packages have nearly driven meaningful large corps under.
The Auto Big3 are a splendiferous example. Why is it that Toyota is making big money in the South and the Big 3 are dying in Detroit? Take a guess.
The big unions have been living a fairy tale. They've damn near killed the goose that lays the golden egg. Add in restrictive environmental regulations and OSHA and your kerplunkt. Welcome to the real world.
In my business (no longer due to illness) I bid on contracts. We loved to get in on Gvt jobs because we had to bid using Davis-Bacon wages/rates (determined by current union scale)... This results in my bid totaling THREE TIMES what it would be under normal circumstances. That means, a job I normally do for $50k costs $150k.
Now, under normal circumstances, how can the union shop possibly compete with me? They couldn't keep up w/ me on quality or performance and I was 1/3 the money.
PS, I am not off-shore, but I was one of those businesses things were getting out-sourced to, and I paid my boys better than most... in the top 5% in my industry/area.
Bruce
You still haven't quoted real data. Your assumptions about people who have gone unemployed beyond the ability to collect unemployment are miniscule in the big picture to be sure, and equally balanced by unprecendented numbers of people who have gone into early retirement that have earned lots of $$$ from stocks or options or sale of their small business.
Wikipedia is a publicly built data base of info that is interesting to learn static facts about many things, but is totally subject to unregulated opinion, and thus is not a factual source for data driven info on things like unemployment. Under-employment is opinion and theory.
No matter ow you slice it, more people are working than ever before, less people are unemployed on a percentage basis than in decades, more people own homes than ever before, etc. We have a healthy, prosperous, growing economy. Most families are doing better than ever. This is not a socialist country, although Democrats have been trying to get us to that point for 60+ years.
On a side note, funny how during the Clinton admin, there was no talk of artificial unemployment figures...everything was just peachy then, right?
You are not correct about productivity. Corporations report on manufacturing figures based on regional data on a worldwide basis. The numers for a Singapore manufacturing site are not co-mingled with the numbers for a US site.
I don't consider EPI a non-partisan site. Reading through their articles, it is loaded with opinion, assumptions, and political positions.