The Perverse Lie That is the "Unemployment Rate" Under Obama

President Obama gleefully celebrated another government-reported drop in the unemployment rate today, this time to 5.5 percent.

The Obama economy has created a perverse distortion of the “Unemployment Rate” because that widely-reported rate represents the percentage of the total workforce actively seeking employment but not able to find employment... The more people who give up hope, and stop seeking employment, [the more it lowers] the “unemployment rate" ... And again today, with a seemingly strong jobs report, the “unemployment rate” dropped, but the number of those dropping out of the workforce also dropped.

Back in the little land we call "reality", Tyler Durden observes:

For those (very few now, with even the Fed admitting the unemployment rate has become a meaningless, anachronistic relic) still wondering why the unemployment rate dropped once again, sliding from 5.7% to 5.5%, the reason is that while the number of unemployed Americans dropped by 274K thousand while those employed rose by 96K, the underlying math is that the civilian labor force dropped from 157,180 to 157,002 (following the major revisions posted last month), while the people not in the labor force rose by 354,000 in February, rising to a record 92,898,000 (people who currently want a job rose to 6,538K) matching the all time high number of Americans not in the labor force.

End result: the labor force participation rate dropped once more, declining to only 62.8%, which as the chart below shows is just off the lowest print recorded since 1978.

The Federalist breaks it down for y'all:

So what does the unemployment rate picture look like if you take into account all of the labor force droputs since the end of the recession in June of 2009? Not pretty. If you take those labor force dropouts into account, the U.S. does not have an unemployment rate of 5.5 percent. Instead, it has a likely unemployment rate of 9.6 percent, and that’s hardly good news.

You read that right. The real unemployment rate is nearly 10 percent, and only through government skulduggery does it appear to be reasonable. But you knew that already, even if only in your heart of hearts.


Hat tip: BadBlue News