Predict the Unemployment Rate

[Kurt_and_Hunter]

Poll question: Predict the Unemployment Rate

Predict the Unemployment Rate to be released tomorrow morning. (Friday)

[Kurt_and_Hunter]

1. Sorry for the snafu on the other post of this!

I had the poll choices centered wrong. (Centered around 9.7 rather than 10.0)

[Kurt_and_Hunter]

2. I am going with 10.2

Expecting a bad report, but a 0.3 move (to 10.3%) seems a little large.

[OhioChick]

3. 10.4 or higher. It's much higher here in OH. n/t

[earthside]

4. Whatever it is "officially" ...

... I'll be very skeptical.

I don't trust the government anymore to tell us the whole truth about anything.

Especially if the rate somehow goes down, after all the lay-offs we heard about in January and the post-Christmas typical slow-down, then I'll be even more skeptical.

[JuniperLea]

5. It's going to be an average, and people don't consider that...

The figures vary drastically per region.

[dmallind]

6. As I suspected, it will be back up after recent decline, but not much and not for long

I'll guess 10.3 this month, back down to 10% next month, and single digits by April. High single digits mind!

[ddeclue]

7. Somebody contact Skinner! There's a problem with this poll! I keep clicking about an inch above

10.4% and nothing is happening! :rofl:

I'm sorry but 10.4% is a good 1.1% below the national rate now and it's 11.8% here and those are just the "official" numbers. The actual unemployment rate in Florida is more like 15-16%.

My prediction for the official rate is 12% but your poll doesn't do justice to reality and offer me anything close to that.

[Kurt_and_Hunter]

8. The largest monthly move we have seen lately was 0.5%

In April to May this year we went from 8.90 to 9.40. I don't think we've seen any other moves that big so maxing out the poll at 10.4% seemed reasonable to me.

A jump to 12% would be astonishing... the markets would probably have seen that coming from further off.

[ddeclue]

11. We are already above 10.4%.. are you emailing me from April of last year?

I am positive we'll hit 12% here in Florida - no questions asked.

[Kurt_and_Hunter]

14. I'm talking "official story" labor dept. top-line number

I think we are currently at 10.0%

I am sure it's worse than that all things considered and certainly worse in Florida, but the poll is for the official #

[ddeclue]

16. I really find that hard to believe based on my own experiences.

[JVS]

9. 11%

[Wardoc]

33. My prediction too. 11%. (nt)

[tritsofme]

10. The unemployment rate will hold steady at 10% as discouraged workers continue to exit

the labor force, giving up looking for work that just isn't there.

In later months as the recovery strengthens we will begin to see the unemployment rate tick up, but for positive reasons. As the jobs situation improves these discouraged workers will re-enter the equation, and it will give the impression that unemployment has increased. However we are not there now.

We will see that people are still leaving the labor force, giving the false impression of a lower unemployment rate. The rate did not drop from 10.2% to 10% because the employment situation in the country has improved. I think it is likely that we see at least 20,000 non-farm payrolls lost in tomorrow's report as well.

[Kurt_and_Hunter]

12. Good point.

Discouraged workers kept it at 10.0 instead of 10.4 last month so it could happen again.

I hope we don't run out of discouragment... it's all that's keeping the situation together. (joke)

[ddeclue]

13. That's a myth - they aren't "discouraged" just dis-counted by their government

by virtue of not paying them any further benefits.

We should NOT use Reagan-esque phrases to frame our arguments.

[tritsofme]

20. I have no clue what you are talking about.

These are descriptive terms to describe someone who has given up the job hunt and exited the labor force, for the purposes of calculating the unemployment rate.

It doesn't imply anything negative about that "discouraged worker".

[ddeclue]

25. That's EXACTLY why the term is WRONG.

These people have NOT "given up the job hunt and exited the labor force".. that's in a Reagan era labor department guy's imagination somewhere. They continue to look for jobs, they just aren't being counted anymore by the government because it makes the government look bad if they have to report the REAL numbers.

GET IT YET?

[pinqy]

30. I don't think you get it

The definition of Unemployed, pretty much unchanged since 1967, is that the person did not work and has actively looked for work in the previous 4 weeks. If a person is not employed or unemployed (and otherwise part of the adult civilian non-institutional population), then they're not in the labor force...these are everyone who face no legal bar to working or not working, but are neither working nor looking for work.

Some of the people not in the labor force say they would like to work even though they're not looking. Those that say the reason they're not looking is because they don't think they'll find work are known as "Discouraged workers." They are included in an alternate measure of labor underutilization known as the U-4.

So one more time...If a person did not work but is looking for work, they're counted as unemployed. Whether or not they've ever been eligible or ever received Unemployment Insurance benefits has NEVER been part of the Unemployment rate.

[ddeclue]

34. NO.. the term got changed to mean anyone whose benefits had lapsed under Reagan..

it does NOT mean that they failed to look for work.. it means that the gov't stopped counting them when their benefits ran out.

[pinqy]

36. The definition of unemployed did not change under Reagan

And unemployment benefits have NEVER been part of the unemployment rate. Do you need links? Employment Situation Technical Note

People are classified as unemployed if they meet all of the following criteria: They had no employment during the reference week; they were available for work at that time; and they made specific efforts to find employment sometime during the 4-week period ending with the reference
week. Persons laid off from a job and expecting recall need not be looking for work to be counted as unemployed. The unemployment data derived from the household survey in no way depend upon the eligibility for or receipt of unemployment insurance benefits.

And for a list of changes: Employment and Earnings Page 172 on gives a list of the changes to the survey since 1941.

So, I've given my evidence...where's yours?

[jschurchin]

15. The Birth/Death model is gonna

wreck havoc tomorrow. January is when adjustments are made for the previous year. And last year the model was a joke. It will not be pretty.

[ohiodemocratic]

17. Didn't the GDP increase by a whopping 5.7 in the last quarter of '09? Why are we predicting doom?

Either we exaggerated the GDP reading, or we are being too pessimistic. Doesn't improved GDP lead to improved job numbers?

[Kurt_and_Hunter]

19. There is a correlation, but that was a quarterly number

The GDP number was for Oct-Nov-Dec.

The jobs number will be for January.

The unemployment numbers for the three months in that 5.7% GDP period were: 10.10 10.00 10.00

I do not know what tomorrow will bring.

[Better Believe It]

26. The actual rate was 2.2 and it will probably be reduced more with additional info coming in.

3.5 of the total reflected a reduction in inventory, not expanded production.

[taught_me_patience]

18. Loss of 120k and rate ticks to 10.2%

Last year will be revised 800K+ additional losses.

[taught_me_patience]

21. People saying 10.4 or higher don't understand the thousands dropping

from the labor pool. That lowers the unemployement rate as measured by the bls. The U6 unemployment measures those people, but it won't be reported.

[Kurt_and_Hunter]

22. I agree. I think your 10.2 post above is probably spot on.

[pinqy]

31. Not quite

The U-6 does not measure the people dropping from the labor pool. It measures those who looked sometime in the past year but are no longer looking but say they want a job and are available for a job. It also includes "part time for economic reasons" and those people certainly have not dropped out of the labor force. The U-5 is probably what you meant, but haven't looked at what the reports actually are, but only the sensationalists who latch on to the highest rate. Technically the U-6 is the unemployed, plus the marginally attached plus those working part-time for economic reasons divided by the labor force plus the marginally attached.

Many people leave the labor force for many other reasons. And it is reported every month in the news release which is available to the public.

[kenfrequed]

23. The official rate is a joke.

I went with 10.1 but it isn't the real rate of unemployment.

[Better Believe It]

24. "10.3% official rate now. Official rate in November, 2010 12.6%

The real rate will remain close to 18%.

Looks like we're moving into stage two of the "Great Recession".

[Statistical]

27. To those who picked 10.0 or lower.

The active labor force is 153 million Americans.
Thus 1% unemployment is 1.5 million Americans.

For Unemployment to fall to 10.0% (0.5% decline) would require net job creation of about 750K jobs.
For Unemployment to fall to 9.5% (1% decline) would require net job creation of 1.5 million jobs.

I think some people don't get the scope of the job loss situation. To keep up with population growth we need new job creation of 125K. So consider 125K jobs a month a headwind.

If hypothetically the economy for next 11 months gained 300K jobs a month EVERY MONTH with no bad months unemployment will still be above 9.0%. If we then gain 400K jobs a month EVERY MONTH in 2011 unemployment will be above 7.0%

[Kurt_and_Hunter]

28. excellent post

(But the current rate is 10.0%)

[Statistical]

29. lol. Oops. I am tired I should go to bed early.

[Biker13]

32. 10.2

[Political Heretic]

35. I'm hoping for a surprising drop (how could you not) but fear 10.5%

If it drops I'll cheer.