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The Student News Site of Stony Brook University

The Statesman

The Student News Site of Stony Brook University

The Statesman


Election 2012: Breaking down the economy issue

Each month since 1915, the Bureau of Labor Statistics (BLS), an independent federal agency that measures labor market activity, has collected, analyzed and released information on the total number and characteristics of employed and unemployed Americans.

The agency surveys about 141,000 government agencies and businesses, which are representative of approximately 486,000 individual work sites, to gather data on the employment, hours and earnings of workers and releases it in a report, “The Employment Situation.”

The BLS considers someone unemployed if they do not have a job despite being available to work and have actively searched for a job in the four weeks preceding the survey.

When the number of people that are unemployed is divided by the number of people currently in the labor force (everyone older than 16 who is neither in an institution nor on active duty), the unemployment rate is calculated. Those who are not working but not looking for work are not considered part of the unemployed population.

The report also calculates how many jobs were added, and that figure, along with the unemployment rate, tends to get the most attention.

In the September report, the unemployment rate dropped to 7.8 percent, dipping below 8 percent for the first time in 43 months, and 114,000 new jobs were added by employers. Employers have added an average of 146,000 jobs per month in 2012, compared to 153,000 in 2011.

How much the latest unemployment rate should be praised depends upon who you ask, but long term trends do demonstrate that the economy is improving. The change may be slow, but it is evident. Compared with a year ago, there are 1.94 million more people working. While there are no booming job openings, the nation isn’t really losing any, either. The average monthly employment growth is at about a break-even level to keep up with the natural increase in population.

But there are many other valuable data in the monthly reports, too, like the number of involuntary part-time workers and discouraged workers, or the tables that break down the numbers by race, age or educational attainment.

Additionally, the reports indicate more specific trends over time. Government employment, for example, has been on a downward trend, but the private sector has added jobs steadily. The health care industry is booming.

Those workers without high school diplomas are three times as likely to be unemployed as those with a bachelor’s degree. The unemployment rate for African Americans is also nearly double that of whites (13.4 percent versus 7 percent).

Forming an opinion on the state of the economy and who is best equipped to repair it, however, is difficult if the jobs numbers are not put into context; in 2008, the unemployment rate was 5 percent, and when President Obama took office in January of 2009 it was the same as it is now, 7.8 percent. In October of that year, the unemployment rate reached its peak at 10 percent.

Today, the price of gasoline, food stamp use, the federal debt and the rate of poverty are faring worse than when Obama took office. Comparatively, though, the levels of consumer debt, corporate profits and mortgage rates are better. The data are, across the board, mixed.

Both Obama and Romney’s campaigns have focused heavily on the economy, and both boast the ability to spur improvement. Generally, the Republican party is perceived as pro-business and pro-job creation. According to U.S. Department of Labor data, though, Democratic presidents have created more jobs per year than Republican presidents have.

Democratic presidents averaged 1.83 million jobs added per year over 40 years in office as compared to the Republican party, which added an average of 966,388 per year throughout 36 years in office.

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