Thought #11                                                               February 2009
Author: Bill Thurston

How the Government Measures Unemployment and Employment
 (http://www.bls.gov/cps/cps_htgm.htm)

First of all, unemployment is measured by the Census Bureau which did report to the Secretary of Commerce. President Obama appears to have changed that so the Census Bureau now reports to Rahm Emanuel, the former head of the Democratic Congressional Campaign Committee who now serves as the President’s Chief of Staff.

Here is a Thought:

The United States Census is taken every 10 years. The next census is next year. One of the results of the census is used to determine the  number of members in the House of Representatives for each state. The number of members in the House of Representatives is a major factor in determining who is in the Electoral College. Census data also directly affect how more than $300 billion per year in federal and state funding is allocated to communities for neighborhood improvements, public health, education, transportation and other programs. The Census Bureau is intended to be nonpartisan and many believe it needs to stay that way.

The Government conducts a monthly sample survey called the Current Population Survey (CPS) to measure the extent of unemployment in the country. There are about 60,000 households in the sample for this survey. The sample is selected so as to be representative of the entire population of the United States. Each month Census Bureau employees interview persons in the 60,000 sample households for information on the labor force activities.

Anybody in the survey is categorized in one of 3 areas:

  1. People with jobs are employed.
  2. People who are jobless, looking for jobs, and available for work are unemployed.
  3. People who are neither employed nor unemployed are not in the labor force.

The survey is designed so that each person age 16 and over who is not in an institution such as a prison or mental hospital or on active duty in the Armed Forces is counted and classified in only one group. The sum of the employed and the unemployed constitutes the civilian labor force.

Who is counted as employed?

  1. All persons who did any work for pay or profit during the survey week.
  2. All persons who did at least 15 hours of unpaid work in a family-operated enterprise.
  3. All persons who were temporarily absent from their regular jobs because of illness, vacation, bad weather, industrial dispute, or various personal reasons, whether or not they were paid for the time off.

Who is counted as unemployed?

  1. All persons who did not have a job at all during the survey week and made specific efforts to find a job during the prior 4 weeks  and were available for work (unless temporarily ill).
    1. Actively looking for work may consist of any of the following activities:

                                         i.    Contacting an employer directly or having a job interview.

                                        ii.    Contacting a public or private employment agency.

                                       iii.    Contacting friends or relatives.

                                       iv.    Contacting a school or university employment center.

                                        v.    Contacting by sending out resumes or filling out applications.

                                       vi.    Contacting by placing or answering advertisements.

                                      vii.    Contacting by checking union or professional registers.

                                    viii.    Contacting by some other means of active job search.

b.    Passive methods of job search do not result in jobseekers actually contacting potential employers, and therefore are not acceptable for classifying persons as unemployed. These would include such things as attending a job training program or course or merely reading the want ads.

  1. All persons who were not working and were waiting to be called back to a job from which they had been laid off are unemployed only if they are looking for work.

Who is not in the labor force?

Labor force measures are based on the civilian non-institutional population 16 years old and over. Excluded are persons under 16 years of age, all inmates of institutions and persons on active duty in the Armed Forces. The remainder, who have no job and are not looking for one, are counted as "not in the labor force." Many who do not participate in the labor force are going to school or are retired. Family responsibilities keep others out of the labor force like homemakers. Still others have a physical or mental disability which prevents them from participating in labor force activities. If you are discouraged and haven't looked for a job in 4 weeks, you are not in the labor force.

In January 2009, here were the numbers from the Census Bureau:

Employment was:             153,716,000 people.

Unemployment was:           11,616,000 people.

Not in the labor force was:      81,023,000 people.

Where can you find more information?

Each month, summary statistics on unemployment and employment are published by the Bureau of Labor statistics (http://www.bls.gov )in a news release titled The Employment Situation.   

Information about the Current Population Survey (CPS) can be found at:
http://www.bls.gov/CPS/

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