Why the People are Right about the state of the Economy and the New York Times is Wrong

November 7, 2014

The New York Times, like many US newspapers, published an article today that said voters were convinced that the state of the economy was deteriorating even though the Bureau of Labor Statistics’ newly published unemployment numbers show that the unemployment rate is at a new low of 5.8 percent - the lowest it has been since the recession.

 

The NYT implicitly admits, as most people know by now, that the unemployment number doesn’t tell us the full story, or any reliable story much of the time, because the unemployment rate only measures people who are actively searching for work. But the article as well as most article that came out today also make the impression that the general employment situation is also the same as it was before the recession by saying that the unemployment figure is only a few percentage points higher than before the recession.

 

However, if you take a look at a fuller measure the employment-to-population ratio of those over 16 years old, the situation is clearly still just as bad as prior to the recession. The graph below contrast the employment rate with unemployment rate over time. Looking at the graph you see the employment has continued to decline even as the unemployment rate has continued to decline.

 

 

 

 

 

 

 

 

 

 

 

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