The Good, The Bad, The Ugly in Unemployment Numbers

There was good news today. While many economists predicted the unemployment number would rise to double digits today, they in fact went down a bit, from 9.5% to 9.4%. Statistically, the margin of error makes them the same, but that doesn't stop everyone from celebrating and headlines trumpeting the end to the recession (depression) is near!

The bad news is, of course, unemployment is still high and is probably going to remain high regardless whether the mucket-mucks say the depression (see, I said it) is over.

And the ugly news is in reality, this 9.4% is only measuring people who are actively looking for jobs, not people who have been unemployed for over the 15 week measuring mark. My suspicion is if we could figure out how to measure all the unemployed but want to find work people in this country, well, that figure would certainly be double digits and also scare the crap out of most politicians. So, like how we measure inflation (taking out food and fuel from the equation, which as we all know from last summer can be and are highly volatile) the government is essentially controlling information to "make us feel better."

The reality is that we have to be creating over 125,000 jobs a month in this country just to employ the people coming into the market. Right now, we have close to 7.88 million people unemployed. There are guesses that the real unemployment rate is over 16% and rising.

If you believe that the American economy is a function of confidence, the numbers released today, the President's comments, and Wall Street's closing are all intended to bolster your sense that the economy is getting back into shape. But dig deeper. Don't let the bally-hooing out of New York and Washington fool you. Numbers can and do deceive. They are intended to do that. It's good, it's bad, and believe me, it's really ugly.