The percent figure that the Bureau of Labor Statistics put out yesterday is not what it appears to be.
The administration goes through some machinations of the number of people out of work to make the unemployment percent seem to go down. They no longer count, like they no longer exist, those people out of work who gave up looking, the underemployed, and those whose 99 weeks of unemployment compensation has run out. When you count them as still alive, the unemployment rate is 15.6 percent.
When you don’t count the them, you cut (on paper) the number of people in the job pool. That is how the administration and their media followers can say the percentage dropped .4% from 9 to 8.6 and yet make it sound like things are getting better. When they are not.
“When the unemployment rate declines, we want to see both employment and participation increase as discouraged workers return to the labor force. Today, we got the former, but not the latter, making the 0.4 percent drop look a bit suspect,” Neil Dutta, US economist at Bank of America Merrill Lynch, told clients. “We would not be surprised to see the unemployment rate give back some of its decline in the coming month(s).”
Considering that nearly half of the jobs created were for the Christmas retail season, expect them to go away in January.
This smoke and mirrors scheme was explained last August in this post.