a compilation of my work and thoughts

Left Out: The Real Unemployment Rate

In middle class prose on May 3, 2010 at 8:00 am

In an economy plagued by historic unemployment and long-term joblessness, it’s probably safe to say you’ve seen them. You may even know one of them.

They are the former lawyers now forced to work part-time behind the McDonald’s food counter. They are the once successful, award-winning journalists that have been out of a job so long, they’re convinced they’ll never get back to work.

They are the “discouraged” and the “underemployed.” Other often-used terms include the “marginally attached” or “involuntary part-time.”

If you only listen to mainstream media reports, you might not realize just how many of these workers actually exist. Furthermore, just how bad the current economic situation really is.

The latest jobless calculations for the month of March show the ranks of these special employment groups are well over 11 million. Yet, they are not included in the official monthly unemployment reports put out by the U.S. Department of Labor’s Bureau of Labor Statistics (BLS).

While the BLS’ most recent unemployment report shows 15 million Americans out of work and an unemployment rate of 9.7 percent, Heidi Shierholz, an economist with the nonprofit Economic Policy Institute, said the actual unemployment rate is far higher.

“The [9.7 percent] unemployment rate measures the share of people who are actively seeking work,” explained Shierholz. “That number does not include other people that are also being directly impacted by the downturn, like the marginally-attached and the involuntary part-timers. When you add in these other groups, you get a much larger chunk of the U.S. workforce. You get up to 16.9 percent unemployment and 26.4 million people out of work. That’s basically 1 in 6 U.S. workers.”

Shierholz explained “marginally-attached” workers meet certain criteria: “You are jobless. You want a job. You are available to work. You’ve looked for work in the last year, but you’re not currently actively looking.”

Within the “marginally-attached” is a sub-category of “discouraged workers.” “They’ve just stopped actively seeking work,” said Shierholz. “They’ve knocked on every door in their town 45 times, and they’re just not going to go back until things start to turn up a little bit.”

Norm Elrod, of Queens, N.Y., is what economists refer to as “involuntary part-time” or “underemployed.” The 38-year-old has been out of full-time work — living below his standard of living and level of education — since October 2008.

Elrod has been laid off three times in as many years — four times going all the way back to 2000.

“The company had to layoff 20 to 25 percent of its staff,” recalled the former marketing manager and MBA graduate. “I was one of them. They called me in one day and they let me go. I thought ‘Oh my God, this is happening again.’ ”

Elrod said he spent months attempting to find work — only to find there wasn’t much work to be found. “After three to four months, two interviews and a few callbacks — everything to no progress — I pretty much realized that it wasn’t going to happen.”

In order to make ends meet for himself and his working wife — no kids — the former businessman has been forced to work part-time as a marketing freelancer. According to him, gigs have been few and far between. He’s on payroll at the moment, but come May, the well-educated, experienced marketing professional will be back on unemployment. His freelance gig is slated to end. Only then will he be included in the official monthly unemployment survey.

Elrod said the uncertainty of unemployment can be daunting. He said he understands why millions of unemployed Americans have become “discouraged.”

“Unemployment now is a very different world than back in the Great Depression, for example,” he explained. “Then, how did you find a job? You went outside. You went from store-to-store or business-to-business. You lined up at the unemployment office. You lined up to get food. You were out there with everybody else.

“Job searching now for a lot of people is sitting at home and sending out resumes online. A lot of people are doing it, but a lot of people are doing it alone. You can see on the news that the unemployment rate is 10 percent, or this many hundreds of thousands of people have been laid off, or this many jobs have been lost — but all you know is that you’re unemployed and you’re in your apartment alone.”

Shierholz estimated there are approximately 5.5 unemployed workers for every available job.

She said the U.S. has lost a total of 8.2 million jobs since the start of this recession in December 2007. And it’ll take the creation of more than 100,000 new jobs per month before the nation returns to full employment. The economist predicts the earliest that’ll happen is 2015.

Until then, Elrod takes the work as it comes. To counter the idleness, the former worker started a blog entitled “Jobless and Less: A Blog for the Employmentally Challenged,” where he talks about his experiences with layoffs, unemployment and the job search. He says the blog was part therapy and part a marketing exercise to teach himself about various aspects of online marketing (i.e. website development and management, search engine optimization, social marketing, etc.) during his career break. He said he hopes it will help distinguish him from the competition.

Like 26.4 million other Americans, he lives one day at a time hoping for that one big break.

“I don’t need to be rich,” he said. “I don’t need to be famous. I just want to be able to support myself. I want to be able to provide for my household…I don’t feel entitled to any of these things. I just want the opportunity.”

  1. Interesting article and the website looks great!

    Check out these data visualizations of long-term unemployment, the jobs and jobless gap and job growth since the start of the recession.

    Long-Term Unemployment Reaches New Heights

    Recession Widens Gap Between Jobs and Jobless

    Still In the Red: The Recession’s Impact on Job Growth

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