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Friday, January 7, 2011

Strange Comment from the AP about Unemployment % Calculation

I was reading along about the recent reduction in unemployment to 9.4% (which one must take with a grain of salt due to the holidays).

And then I get to this:
Another key reason for the drop in the December unemployment rate was that the government no longer counts people as unemployed when they stop looking for work.
Maybe I'm missing something, but that is not anything new.  The government has always (or at least as long as I've been alive), excluded those people who weren't looking for a job from unemployment calculations.

???

UPDATE:
On the power of words.....
I read the article as if there was some technical BLS change.  As it happens, and as I reread this 10 times to figure out what was going on, it appears they meant :

"Another key reason for the drop in the December unemployment rate was that the government stops counting no longer counts people as unemployed when they stop looking for work."

The original wording, while technically correct I suppose when read the way they meant, could easily be misinterpreted to mean the government has changed its methodology.  As I've read user comments regarding this widely distributed article, it seems I'm not the only one who misread this.  That's unfortunate because I think that futher erodes economic education of the masses.

Or, maybe it's just me and I'm having a bad day at reading comprehension ;)

UPDATE 2:
Somewhat to my shock, MSNBC has quickly responded to my inquiry and has agreed the wording is "awkward."  They have since changed to :
"However, the drop in the unemployment rate for December can partly be explained by a drop in the number of people considered to be in the labor force. That could be because some people gave up on finding a job. A person is no longer counted as unemployed if they are no longer looking for work."
That's one news organization---but that language was copied widely (which is what made me think it was AP).  Kudos to MSNBC though for that, and for the great reader service.