Understanding The Unemployment In America

July 17th, 2012
in Gary's blogging

ABBOTT AND COSTELLO - 2012 Version

Costello: I want to talk about the unemployment rate in America.

Abbott: Good subject. Terrible times. It's 9%.

Costello: That many people are out of work?

Abbott: No, that's 16%.

Costello: You just said 9%.

Abbott: 9% unemployed.

Costello: Right 9% out of work.

Follow up:


Abbott: No, that's 16%.

Costello: Okay, so it's 16% unemployed.

Abbott: No, that's 9%...

Costello: Wait a minute. Is it 9% or 16%?

Abbott: 9% are unemployed. 16% are out of work.

Costello: If you are out of work you are unemployed.

Abbott: No, you can't count the "out of work" as the unemployed. You have to look for work to be unemployed.

Costello: But they are out of work!!!

Abbott: No, you miss my point.

Costello: What point?

Abbott: Someone who doesn't look for work, can't be counted with those who look for work. It wouldn't be fair.

Costello: To who?

Abbott: The unemployed.

Costello: But they are all out of work.

Abbott: No, the unemployed are actively looking for work...

Those who are out of work stopped looking.

They gave up.

And, if you give up, you are no longer in the ranks of the unemployed.

Costello: So if you're off the unemployment roles, that would count as less unemployment?

Abbott: Unemployment would go down. Absolutely!

Costello: The unemployment just goes down because you don't look for work?

Abbott: Absolutely it goes down. That's how you get to 9%. Otherwise it would be 16%. You don't want to read about 16% unemployment do ya?

Costello: That would be frightening.

Abbott: Absolutely.

Costello: Wait, I got a question for you. That means they're two ways to bring down the unemployment number?

Abbott: Two ways is correct.

Costello: Unemployment can go down if someone gets a job?

Abbott: Correct.

Costello: And unemployment can also go down if you stop looking for a job?

Abbott: Bingo.

Costello: So there are two ways to bring unemployment down, and the easier of the two is to just stop looking for work.

Abbott: Now you're thinking like an economist.

Costello: I don't even know what the hell I just said!

Now you know why unemployment figures are improving and you should now understand the state of the union.

(Source unknown)

 

To contact me with suggestions or deserved praise:

gary@econintersect.com

Written by Gary









Make a Comment

Econintersect wants your comments, data and opinion on the articles posted.  As the internet is a "war zone" of trolls, hackers and spammers - Econintersect must balance its defences against ease of commenting.  We have joined with Livefyre to manage our comment streams.

To comment, just click the "Sign In" button at the top-left corner of the comment box below. You can create a commenting account using your favorite social network such as Twitter, Facebook, Google+, LinkedIn or Open ID - or open a Livefyre account using your email address.

















 navigate econintersect.com

Blogs

Analysis Blog
News Blog
Investing Blog
Opinion Blog
Precious Metals Blog
Markets Blog
Video of the Day
Weather

Newspapers

Asia / Pacific
Europe
Middle East / Africa
Americas
USA Government
     

RSS Feeds / Social Media

Combined Econintersect Feed
Google+
Facebook
Twitter
Digg

Free Newsletter

Marketplace - Books & More

Economic Forecast

Content Contribution

Contact

About

  Top Economics Site

Investing.com Contributor TalkMarkets Contributor Finance Blogs Free PageRank Checker Active Search Results Google+

This Web Page by Steven Hansen ---- Copyright 2010 - 2017 Econintersect LLC - all rights reserved