Statistics are devious, difficult things, which is why they are bandied about so freely in politics, making it hard to know what the truth is sometimes. For example, is long-term unemployment getting better? A recent story by CNBC, “Long-Term Unemployment Now a Thing of the Past?” suggests that it is.
The first part of the article is optimistic. But then the painful truth emerges:
- We have 12.3 million people officially unemployed, and of these, 4.7 million are considered “long term unemployed,” but…1
- Many of those listed as employed have taken whatever menial job they could find, not the level of work they are capable of and have done for decades.
- About 7 million unemployed people have given up looking.2
- 7 plus 4.7 = almost 12 million long-term unemployed people, people increasingly unlikely to ever find important work again.3 Ponder that one for a moment. It isn’t getting any better, it’s getting worse. They are dropping out of sight.
- Meanwhile younger people are being hired, the older long-term unemployed left behind. So the low level of “stable growth in employment” we see is just enough, give or take, to hire the new people coming into the workforce.
- Speaking of new grads…there’s concern that they also are underemployed. According to a recent study, in 2010, 20 million of them worked in jobs requiring less than a bachelor’s degree. Furthermore, 15 million college grads held jobs that required only a high-school diploma.4
I am not sure what this means for the country, the economy and the markets in the long run. But we need to be thinking about it; it will not go away.