Policy Feature Issue: November Jobs Report

Dec 10, 2013 | Policy •

Last week, the Bureau of Labor Statistics (BLS) released its October monthly jobs report.  Nonfarm payroll employment increased by 203,000 in November, and the unemployment rate decreased to 7.0 percent.[1] However, Labor Force Participation remains at historic highs as an increasing number of Americans continue to leave the workforce.  As has been the case throughout 2013, the economic recovery continues to lag behind past recoveries, with millions of Americans still out of work, and millions more who have fallen out of the workforce entirely.

Facts You Need to Know:

  • The unemployment rate decreased in November from 7.3 percent to 7.0 percent.[2]  The number of unemployed persons decreased by 365,000 in November.[3]  Though the unemployment rate stands at 7.0 percent this month, this metric is largely misleading.  The U-6 unemployment rate, a measure of labor underutilization that takes into account persons marginally attached to the labor force as well as persons employed part time for economic reasons (as a percentage of the civilian labor force plus all persons marginally attached to the labor force), is 13.2 percent.[4]
  • Long-term unemployment (those unemployed for more than 27 weeks) remained unchanged at 4.06 million in the month of November.[5]
  • The Labor Force Participation Rate (LFPR), which identifies the number of people who are active participants in the labor force (relative to the total population), increased to 63.0 percent in November from 62.8 percent in October.[6]  In October, the LFPR dropped to its lowest level since March 1978.[7]
  • The Employment-Population Ratio, a metric that establishes the raw employment rate, increased from 58.3 percent to 58.6 percent in November.[8]  The employment population ratio is 2.0 percent lower than it was when President Obama took office.[9]

Why Does a “Pro-Growth” Agenda Matter?

  •  Labor force participation increased by 0.2 percent in the month of November.[10]  Despite this increase, labor force participation has not recovered to pre-Obama Administration levels, when the LFPR stood at 65.8 percent.[11]
  • Moreover, the number of working age Americans who are not participating in the labor force stood at 91.27 million people in October, an increase of 2.42 million since November, 2012.[12]  While the number of Americans participating in the workforce increased from October, the overall sluggish rate of economic growth and job creation has discouraged millions of Americans from entering the labor force.
  • Finally, an employment population ratio of 58.6 percent reflects the reluctance of Americans to reenter the workforce, believing that they are better off without a job.  A higher employment-population ratio, facilitated by a pro-growth agenda, strengthens GDP per capita, leading to improvements in consumer spending, and greater growth.
  • Americans deserve better than a weak recovery that is struggling to create jobs and grow the economy.

 


[4] According to the BLS, “Persons marginally attached to the labor force are those who currently are neither working nor looking for work but indicate that they want and are available for a job and have looked for work sometime in the past 12 months. Discouraged workers, a subset of the marginally attached, have given a job-market related reason for not currently looking for work. Persons employed part time for economic reasons are those who want and are available for full-time work but have had to settle for a part-time schedule.” See: http://www.bls.gov/news.release/empsit.t15.htm

[7] BLS, Historical Tables, Labor Force Participation Rate

 

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