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Misleading Unemployment Statistics
ОглавлениеThe official unemployment statistics published by governments in western countries are a sham. They don’t come close to measuring the true state of unemployment. These official monthly jobless rates only include people without jobs who are actively looking for work. A more realistic jobless rate would include the proportion of people without jobs with the qualifier that some of these do not want to work. At the beginning of 2011, the official jobless rate in the US was around 10 percent and the unofficial rate, increasingly being referred to in the media, was between 17 and 19 percent. In Canada the official jobless rate was around 8 percent and the unofficial rate between 12 and 14 percent. The mainstream media are doing a better job of reporting on these rates than they have done in the past. For too long they simply parroted the official jobless rates published by governments. Now they often include the unofficial rate as well, which gives the public a more accurate reading on what is going on in the workplace. They should take this one step further and lead each month with what the unofficial unemployment rate is followed by the official rate being published by the governments. Over time, this would diminish the significance of the official government jobless rates, which is long overdue.
The publication of monthly, sometimes conflicting surveys on employment, further cloud the issue of what is really going on in the workplace. An example of this was given in a November 5, 2009 report in The Canadian Press. It pointed out that the official report from Statistics Canada said that 27,000 jobs were created in the workplace in August 2009 while a lesser-known industry survey that is closely monitored by economists said that the workplace shed 110,000 jobs in the same month. This led to economists cautioning Canadians to take the official monthly data with “a large grain of salt.”
Part-time work and full-time work are often combined in reporting the number of jobs being created, which can give a misleading reading on the health of the economy. An example of this was given in a June 7, 2008 Canwest News Service article on Canada’s job growth, considered to be pretty robust at that time. It pointed out that in the year prior to the article, part-time employment had risen at nearly twice the gains had by full-time jobs. The headline statistic for the previous month had shown that there was job growth in Canada, which on the surface was true. But that growth was derived from a gain of forty thousand part-time jobs and a loss of thirty-two thousand full-time jobs.
In a series of articles in February 2005 in Scotland’s Sunday Herald newspaper that looked at how unemployment statistics are produced there, a Glasgow University lecturer who studies this area commented that “This country is very good at hiding large chunks of the unemployed through statistics.”
The Economist magazine ran a feature in September 2006 on Sweden. As part of the coverage on what was going on there it stated that “Sweden is a world champion at massaging its jobless figures.” From July 2008 to July 2010, Irish unemployment rose from under 6 percent to over 14 percent. This number would be much higher were it not for the large number of Eastern Europeans who have headed home because of the weak job market in Ireland and the thousands of Irish who are leaving the country, reminiscent of what happened for much of the twentieth century.
Kidding ourselves that the employment situation is better than it is in reality is the worst position we could take in dealing effectively with the challenges in today’s workplace. Unfortunately, this is exactly what we are doing. We need to overhaul the methodologies we use to produce our monthly unemployment statistics, because they are giving us a false reading. We must expand our approach to this area. We need to know how many people are underemployed, including all the college/university grads and qualified, downsized workers who can’t find decent jobs and who are working in service jobs to make ends meet. We need to know how many people have given up looking for work because they can’t find a decent job, estimated to be over 3 million in the United States alone. And we need to focus more on the quality of work that people are engaged in and less on the simplistic approach that tells us that x percentage of the workforce is employed. How many are working for minimum wage? How many are working part-time? How many have temporary work? How many are contract workers? How many are self-employed? If you dig hard enough you can find occasional reports that give a better reading of what is going on behind the headline statistics. An August 31, 2010 report in The New York Times under the heading “New Job Means Lower Wages for Many” showed that the job expansion which has taken place in recent years was skewed towards industries with wages that are low to middling. This is adding to the ranks of the “working poor” who are increasingly showing up at food banks and contributing to overall weakness in consumer confidence in the United States.