(this situation will get progressively worse, imo)
newsobserver.com
JOBLESS: NARROW DEFINITION
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Unemployed and uncounted
Part-time workers, discouraged applicants not included in most-cited rate
Laid-off Nortel Networks employee Bill Blaine tries to make ends meet by working eight hours a week as a sales clerk at West Marine in Raleigh. Blaine says he wants a full-time job, particularly because he has two sons to put through college.
Staff Photo By Harry Lynch
By AMY MARTINEZ, Staff Writer
If you didn't know better, you might think Bill Blaine was unemployed.
He pores over want ads, (however few there are), sends out resumes, networks with former colleagues at Research Triangle Park and worries that if he doesn't find a job soon, he and his wife, Judith, will have to dip into their retirement savings.
Yet, as far as the government is concerned, he is among the overwhelming majority of working Americans who are gainfully employed.
That's because Blaine, who was laid off from Nortel Networks in November, works eight hours a week as a sales clerk for West Marine in Raleigh.
No matter that he earns just one-tenth of his former salary. Or that his 23 years of management experience is put to little use selling boat parts and repair kits. Or that he needs, and wants, a full-time job so he can put two sons through college.
None of this makes a difference to U.S. Department of Labor economists who calculate the monthly unemployment rate based on a simple, yet narrow, definition of what it means to be unemployed: out of a job and actively seeking one.
Part-timers like Blaine, 54, who would rather be full-time, plus workers who've given up finding a job until the economy improves, are left out of the rate.
It's a quirk that has been debated for years and takes on greater relevance in times like these, when the official unemployment rate begins to drop but anecdotal evidence suggests little has changed for countless job seekers struggling to make ends meet.
"Raleigh is suffering drastically, but to look at the numbers, hey, we're doing fine," Blaine said, adding that many of his former colleagues also have settled for part-time work or, worse, thrown up their hands.
"Most people I talk with have gotten to the point where they're tired of banging their head against the wall," he said. "Employers are only hiring people who meet 100 percent of their qualifications, and there's no attempt on their part to say, 'Maybe this person is trainable.' "
Blaine couldn't believe it, therefore, when the Labor Department announced last week that the national unemployment rate fell in August to 5.7 percent from 5.9 percent a month earlier.
"Pleasant surprise," the headlines read, "Jobless rate falls."
But if that ran counter to Blaine's perception, it also failed to reflect less pleasant data in the report. Employers added 39,000 jobs last month, many fewer than the 125,000 needed to keep unemployment stable.
It also didn't take into account 4.3 million workers employed just part time because of economic conditions. Nor did it include 1.4 million Americans who were willing to work but not actively looking.
If you think those two groups are, for all intents and purposes, unemployed, the nation's jobless rate hit 9.5 percent, according to the Labor Department.
"The official unemployment rate is a measure of labor force activity and not of economic well-being," said Ken LeVasseur, a senior economist at the U.S. Bureau of Labor Statistics, a division of the Labor Department that oversees employment data.
"Clearly, there's a correlation, but it's a less-than-perfect correlation," LeVasseur said.
Since 1940, the Labor Department has used the same method to calculate unemployment: Each month, 60,000 U.S. households are surveyed about recent activities.
Only minor changes have been made in the department's definition of "unemployed," despite discussions among academics and labor advocacy groups calling for a more inclusive one.
To be "actively looking," it is not enough to glance at the want ads and walk away in disgust; for example, a resume or phone call must go out.
Michael L. Walden, an economist at N.C. State University, said he thinks laid-off workers who have given up finding jobs ought to be counted, especially now.
"Early in a recession, those folks who've lost jobs are going to look for work and be counted in the unemployment rate," Walden said. "As the recession drags on and they've not gotten work, they're more likely to give up and not be counted."
The Labor Department in 1994 began publishing statistics on discouraged workers monthly.
But the department, which also calculates unemployment rates for each state, provides discouraged worker data on a national basis only. The states are left with their best guesses.
Walden says North Carolina has more discouraged workers than most states because of its reliance on technology and manufacturing, both hit hard by the recession. He estimates the state's unemployment rate would be at least 12 percent, if you add in discouraged workers. July's official unemployment rate was 6.8 percent.
Locally, many laid-off workers are trying to ride out the downturn on a spouse's salary, credit cards and savings.
Dave Wilhelm, 56, of Raleigh, who was let go from Nortel Networks in October, works part-time at Sears as a marketing associate. That means he walks through the store making sure signs match advertisements. The job pays $7.50 an hour, nowhere near his Nortel paycheck.
As he puts it, "Regular hours are out, high pay is out, but it's interesting." Besides, it's not like he can be choosy.
"No one's going to come around to us old telecom jocks and offer us great jobs," he said. "Maybe, in a year or two, they'll offer us some good jobs.
"In the meantime, we're not going to beat our heads against the wall looking for jobs that aren't out there."
The number of part-time workers who prefer to be full-time is climbing nationally, according to the Labor Department. At 4.3 million in August, it's up from 4.2 million in July and 3.4 million a year ago.
Likewise, more people seem to be dropping out of the labor market, even though they want a job. The number grew from 1.35 million a year ago to 1.44 million last month. Of those, 372,000 said they were discouraged about job prospects, up from 335,000 last year.
Jeffrey Wenger thinks statistics such as those are crucial to understanding the full employment picture. Wenger, an economist with the Economic Policy Institute in Washington, said they suggest more workers cannot find jobs at their skill and experience levels.
"These people could be making a productive contribution to our economy, but they can't because our economy is out of whack," he said.
The Labor Department, meanwhile, defends its definition of "unemployed" as time-tested. At the very least, it's objective.
LeVasseur, the BLS economist, notes that on the other side of the spectrum, some think only workers out of a job 15 weeks or longer should be counted.
If you take that view, U.S. unemployment was 1.8 percent in August.
Staff writer Amy Martinez can be reached at 829-4562 amartine@newsobserver.com. |
