New job numbers out today indicate a rosy picture for the economy. The ‘low information’ unemployment rate dropped to 7.3%. Great, right? Maybe not. The real story, as CNBC reports, is 312,000 people dropped out of the labor force, changing the calculus and giving us the ‘best’ unemployment number in months, and lowest labor force participation rate since 1978. It’s an upside down kinda world.
Screenshot from the article.
From the CNBC article
The U.S. economy added 169,000 jobs in August, the Department of Labor said Friday.
Although that was an improvement from 104,000 jobs added in July, it was also slower than the average pace of job growth over the last 12 months, and missed economist expectations.
Job growth for both June and July was also revised lower by a total of 74,000 jobs.
Meanwhile, the unemployment rate fell to 7.3%, but the decline came for the wrong reasons, as 312,000 people dropped out of the labor force. Only 63.2% of Americans now participate in the labor force — meaning they have a job or are looking for one. That’s the lowest rate since August 1978.
This type of creative accounting would make Bernie Madoff blush. Comment on this at TheNewsCommenter.com.