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Unemployment Report

Senator Doug Whitsett
R- Klamath Falls, District 28

Phone: 503-986-1728 900 Court St. NE, S-303, Salem, Oregon 97301
Email: sen.dougwhitsett@state.or.us
Website: http://www.leg.state.or.us/whitsett
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E-Newsletter 12/5/11

At first blush the recent Bureau of Labor Statistics unemployment report is encouraging.

The report shows that our national economy created more than 120,000 net new jobs in the last month. It also reveals that an average of more than 100,000 net new jobs have been created in each of the past three months. Most of the new hiring is being done by small businesses that traditionally create three out of every four new jobs.

The report alleges the national unemployment rate to be at 8.6 percent. This is down four tenths of one percent in only the last month. These labor trends are certainly welcome.

However, a closer reading of the Bureau’s report is less heartening.

The report points out that 315,000 fewer people applied for work during the last month. What that really means is that more than 300,000 workers have exhausted their unemployment benefits without finding a job. The Bureau no longer counts them as unemployed workers because they are no longer seeking unemployment benefits. The report indicates that nearly half of the alleged improvement in national employment is comprised of workers who have “aged out” of unemployment benefits but that still have not found work.

Only 64 percent of eligible workers are currently participating in the American workforce. The historically high 36 percent that are not working is comprised of a backlog of about 13.3 million officially unemployed workers plus the hundreds of thousands who have left the labor force. The average period of time that an American worker is unemployed is at and all time high of 40.9 weeks. Within the next twelve months, more than three and one half million more unemployed workers will officially not be counted as unemployed in the event that the Bureau of Labor continues its existing accounting methods and if the current employment trends persist.

The report also explains that our normal population growth requires our national economy to create about 150,000 net new jobs each month in order to just maintain the current rate of employment. These new potential members of the workforce run the gamut from kids dropping out of school, high school graduates, junior college and university graduates, immigrants looking for work as well as additional family members seeking employment to bolster family budgets. Most of these potential workers are not counted as unemployed because they have not previously been employed. However, our national economy is only creating about 100,000 net new jobs per month. That is about 50,000 fewer jobs each month than is required to maintain a constant rate of employment.

The combination of 300,000 workers aging out of unemployment benefits each month, and 50,000 fewer jobs being created than are needed to meet our normal employment population growth each month, calculates to a potential of more than four million uncounted unemployed workers within the next twelve months.

The Bureau’s report also points out that a high percentage of the new jobs being created are low to moderate paying retail employment that may be temporary or seasonal. Their figures show that creation of medium to high paying manufacturing and construction jobs remain stagnant.

Our state and federal governments should be required to provide their U6 unemployment estimates to the public. That calculation attempts to capture all those who want full time employment but are not able to secure a full time job. It includes those who have not previously been employed, those who have been unemployed too long to receive unemployment benefits, previously self employed people who are no longer working and folks who are working less than full time, that want a full time job.

The national U6 unemployment rate continues to hover around 16 percent. That U6 rate exceeds twenty five percent in many rural areas. In my opinion, that rate is the only statistic that has meaning to struggling families. They do not need to be regaled with employment figures that are purposely misleading because they are politically expedient. Citizens deserve to be told the truth.


Please remember, if we do not stand up for rural Oregon… no one will.

Best Regards,


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              Page Updated: Tuesday December 06, 2011 03:25 AM  Pacific

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