“What Is the Average National Employment Rate?”
“Just really simple,” Mara Liasson of NPR asked, “What is the average national unemployment rate?”
“What’s the average?” Sean Spicer asked in response.
At this point, the two went back and forth a bit as Spicer discussed how the Bureau of Labor Statistics releases several figures related to unemployment.
“There’s a reason that we put out several versions of that. One is the illustrative nature of how you count the unemployed. Whether or not they’re long-term unemployed or whether or not they’re still seeking a job. But there’s a reason that you put out several of these statistics,” Spicer said. “It’s so that economists can view them and look at different landscapes on how to make economic policy.”
Liasson, who mentioned during the exchange that she understood the difference between the numbers continued, “During the campaign at one point, Trump had said it was 42 percent. I just want to be clear on where we’re starting from.”
An Overview of Unemployment Data Measurements
Unemployment data isn’t as complicated as this exchange might indicate, but there are a few different ways to look at the data:
- BLS unemployment statistics – The Bureau of Labor Statistics’ measurement of unemployment is accurate, and the current rate is 4.7 percent. In short, the rate is explained as follows: “People 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.” The Bureau of Labor Statistics also tracks “Alternative measures of labor underutilization,” which includes the total unemployed, plus those employed part-time for economic reasons, plus those marginally attached to the labor force. That statistic is currently 9.2 percent. (For more information, check out this document that fully explains how the government measures unemployment.)
- BLS labor force participation rate – The unemployment figures that Trump mentioned during the campaign are more closely tied to labor force participation rate figures. The current labor force participation rate is 62.7 percent. That means that 37.3 percent of the population isn’t working. This statistic includes, for example, retired persons and stay-at-home parents. It is not a measure of people who are out of work and looking for a job.
- The unemployment rate as cited by the EPI – The Economic Policy Institute notes that Bureau of Labor Statistics data leaves out “missing workers” from its final tally. This number is meant to include workers who are unemployed and “because of weak job opportunities” have decided to no longer actively seek employment. The EPI says the current unemployment rate is at 6 percent when these individuals are taken into account.
“It’s not just a number to him.”
Spicer went on to explain Trump’s feelings about unemployment, and unemployment data, a little more.
“That’s his ultimate goal, that when he sees people who are hurting, that haven’t had wages lifted up, that are unemployed, that can’t save for their kid’s future, that are having trouble with their healthcare costs, that’s what he really cares about. It’s not just a number to him. It’s about, is someone getting by, are their wages going up, can they find a better job, do they have access to education….”
He continued, “He’s not focused on statistics as much as he is on whether or not the American people are doing better as a whole.”
How will Trump assess unemployment?
Part of Spicer’s point here is well understood — unemployment stats aren’t just numbers, they represent real people with actual lives and hardships that the government should be concerned about.
However, the trouble is that these statistics are how we determine “whether or not the American people are doing better as a whole.” If President Trump says these numbers aren’t his focus, how are we to know how unemployment is shifting during his time in office? Will he pay attention to the data — and if not, what will be the baseline?
At the end of the day, facts are facts. And, economists will use unemployment data to assess Trump’s impact on the labor market. But, based on Spicer’s comments yesterday, the president might focus on other methods to determine the results of the changes and policies he implements. If so, it will be on economists and journalists to interpret those numbers so that the American people have a real sense of the job market and the economy.
Tell Us What You Think
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