The Dirty Truth About Misleading Unemployment Statistics

July 23, 2015 at 2:57 pm 4 comments

It seems like everywhere you look these days, there are headlines screaming with unemployment numbers. Statistics purporting to show how many people are working or not working are thought to be an indicator of the general health of our economy. Now we all know that news organizations have a natural tendency to sensationalize things to gain ratings. They tout numbers designed to show us that things are either getting better or getting worse, depending on what flavor of news you choose to follow. Viewers of FOX News will likely get a very different picture of things than viewers of CNBC or CNN. Lately I’ve been seeing headlines with statements like “Unemployment Rates Dropping,” and “Applications for Jobless Benefits Falling” and “Employers Adding New Jobs.” The government loves to brag about their wonderful accomplishments. Presidents love to claim that things are better than they used to be, and take credit for improving our lives during their time in office. But are those statements and statistics meaningful and accurate? Do they tell the whole story?

Statistics are an interesting thing. It’s been said that you can prove or disprove just about anything with statistics depending on what your sample is, how you count things, and how you interpret the results. At the height of the most recent recession — around the end of 2009 — the U.S. Bureau of Labor Statistics reported the national unemployment rate to be around 10%. Today, that number is under 5%. That sure sounds like things have gotten better, right? But here’s the dirty truth about those numbers: they are only counting a small percentage of the actual potential workforce population. They are NOT counting people who are “underemployed” — i.e. people who have taken low-paying jobs well below their experience level just to pay their bills. They are NOT counting people who have taken part-time jobs — in some cases just a few hours a week, and usually without any benefits. And most importantly, they are NOT counting people who have been out of work for so long that they’ve become discouraged and have “given up” looking for a job altogether. For anyone in those last categories, these government statistics are a cruel joke, indeed!

Check out this 2-minute video cartoon that explains how the government arrives at their unemployment statistics. It’s both hilarious and depressing at the same time:


 
So, what is the “truth” about the current unemployment picture? Again, it depends on how you count things … but here’s an interesting tidbit I came across: According to the Gallup organization, 30 million Americans are either out of work or severely underemployed. Gallup defines a “good job” as one that is at least 30 hours or more per week with a company that provides a regular paycheck. Using that definition, they’ve determined that right now in the U.S., only 44% of adults age 18 and over have “good jobs.” They go on to say that in order to restore America’s middle class, the target for this should be at least 50%, with 10 million new good jobs.

Elsewhere, AP reported that last month U.S. employers added 223,000 jobs, but despite widespread job growth, overall there is a shrinking workforce. As as recruiter, I can certainly attest to the fact that in almost every specialized job category, there are more job openings than there are qualified candidates! I keep hearing the term “Talent War.” Among my peers in the staffing industry, there is a widespread feeling that qualified talent is getting harder and harder to find in almost every category.

One of the most obvious explanations for this growing talent shortage is simple demographics. In 2011, the oldest of the Baby Boomers (people born between 1946 and 1964) started turning 65 — the traditional retirement age. Of course more and more people now expect to keep working past the age of 65 … but sooner or later just about everyone reaches an age where full-time work is no longer a desirable option. We are now seeing the beginning of a mass retirement movement unprecedented in American history – a radical demographic shift in the makeup of our work force. All told, there are about 76 million people in that Boomer generation who will, over the next couple of decades, drop out of the work force. By contrast, there are only about 51 million “Generation X’ers” (people born between 1965 and 1976) who could potentially step into all those higher level jobs that the Boomers are retiring from. That leaves a huge talent deficit: at least 25 million fewer potential experienced workers!!!

OK — so what does this all mean to the average job-seeker? Honestly, not much. It’s really mostly just background noise. For anyone in job-seeking mode, my advice is to take most of what you see and hear in the news with a grain of salt and just concentrate on the basics of job-seeking strategies as expounded in the numerous articles here in Recruiter Musings. Work on your résumé, work on your elevator pitch, work on your interview presentation, and most importantly, concentrate on the activities that will get you in front of actual decision-makers at your target companies: “Networking, Networking, Networking!”

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Entry filed under: Advice for Job Seekers. Tags: , , .

Job-Seekers’ Top-10 Lists for 2015, and New Year’s Resolutions for 2016 What Recruiters Say vs. What Job-Seekers Hear

4 Comments Add your own

  • 1. Resume man  |  September 10, 2015 at 4:24 pm

    “As as recruiter, I can certainly attest to the fact that in almost every specialized job category, there are more job openings than there are qualified candidates!”

    Hey Michael, agree with article and skewed job numbers. Regarding your quote, I always wonder if the caveat is “based on what client is willing to pay”. Offering more money usually gets better talent. What I find is that rates are still too low for experience and talent requested. No one ever comes back and says “we can pay more”, so trying to understand your view.

    Reply
    • 2. Michael Spiro  |  September 10, 2015 at 5:21 pm

      I agree that some clients are unwilling to pay what the market dictates for certain skill sets. In cases like that, we try to advise them to increase their budgets … and if there is no room for movement on the pay, we will sometimes just walk away from those searches. However, that is a separate issue from the talent shortage I was referring to. I’m sure there are exceptions to this — but the big picture is that in general, qualified talent is in higher demand and lower supply. As one example: I currently recruit in the Finance space, and one of the most common positions I search for is Financial Auditors. Richard Chambers, the Chief Executive of the Institute of Internal Auditors, recently wrote that “companies are facing the most severe internal-auditor shortage in more than a decade.” It’s not about offering more money … experienced auditors are just hard to find at any price! Other niche positions in other industries (especially IT) present similar challenges for recruiters in today’s market.

      Reply
  • 3. Bren Hill  |  February 17, 2016 at 4:50 pm

    Michael, Do you think it is better to be underemployed and keep your resume current, even if the underemployment is the kind of unskilled labor that I have heard many job hunting experts call “the kiss of death” to a professional career? For example, would you recommend that a laid-off IT professional who has trouble finding another position in their field right away, take an unskilled job (McDonald’s, hotel housekeeping) to keep the resume active and to keep some money coming in? Or are they better off not working at all, at least until the unemployment runs out? I went so far as to go back to school and did an IT internship, but I still haven’t had any interest on my professional resume, and I’m afraid it has a lot to do with the time I spent doing low wage, unskilled positions just to feed my family after I got cut in a massive round of layoffs at my last professional position.

    Reply
    • 4. Michael Spiro  |  February 19, 2016 at 10:58 am

      I’d say do whatever you have to do to pay your bills and support your family. However, you should not put jobs on your professional resume that are outside of your niche (like McDonalds, etc.) Better to just list your IT jobs, and leave the others off. You can explain the gaps during an interview – but listing them on your resume will probably get you eliminated before you even get that interview!

      Reply

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Michael Spiro

About the Author:

Michael Spiro has been a 3rd-Party Recruiter and Account Executive for over 15 years. He is currently the Director of Recruiting / NE Ohio Region for Experis Finance, a dedicated business unit of ManpowerGroup. Other recent positions include President of Midas Recruiting, a boutique head-hunting firm, Director of Talent at Patina Solutions, and Executive Recruiting positions with two of the largest search firms in North America. Before his career in the staffing industry, Michael was a manager in a large non-profit social-services organization. And in a former life, Michael was active in the entertainment industry, with extensive road-warrior experience as a touring performer (singer-songwriter / guitarist / comedian) and as a recording artist, producer and booking agent.  [More...]

Index (by Topic):

Résumés & Cover Letters:
 The "T" Cover Letter - The
         Only Type Worth Sending

 The Brutal Truth on How
         Résumés Get Eliminated

 Explaining Short Job Stints
         and Employment Gaps

 The Résumé Test &
         Checklist: Does Yours
         Pass?

 Beating the Résumé-
         Elimination Game: Where
         Do Recruiters' Eyes Go?

 The Truth About Lying on
         Résumés

Networking:
 How to Network: A
         Step-by-Step Guide for
         Job Searching

 Looking for Networking in
         All the Wrong Places

 Targeted Networking: How
         to Effectively Reach Out

 The Art of Giving: the Key to
         Effective Networking

Interviewing:
 Face-to-Face Interviews:
         Secrets, Tricks and Tips

 Phone Interviews: Secrets,
         Tricks and Tips

 Skype Interview Tips ...
         Welcome to the Future!

 Nuggets: A Secret
         Interviewing Technique

 Answering the Dreaded
         Salary Question

 20 Surefire Ways to Blow
         an Interview

 "So, Do You Have Any
         Questions?" Nailing the
         Interview Closer

 Cool InfoGraphic: "What
         You Wish You'd Known
         Before Your Job
         Interview"

Age Discrimination:
 Age Discrimination: Secret
         Conversations Revealed

 Age Discrimination:
         Exposing Inconvenient
         Truths

 Are You "Overqualified?"
         Handling the Age Issue

 Baby Boomers to the
         Rescue! An Idea Whose
         Time Has Come ...

 Overcoming Job-Search
         Obstacles and
         Redefining Your Career
         After 50

 Advice for Recent Grads
         and Career-Changers

Switching Jobs:
 The Proper Way to
         Quit a Job

 Counteroffers: Just Say No!

General Job-Seeking Info:
 The Real Truth About
         Working with Recruiters

 Contract/Consulting Jobs
         Explained ... Available in
         3 Different Flavors

►  What Recruiters Say
         vs. What Job-Seekers
         Hear

►  The Dirty Truth About
         Misleading Unemployment
         Statistics

►  Let the Jobs Find You:
         Making Yourself More
         "Searchable"

 "Help ... I Need a Job!" A
         9-Step Guide for Newly
         Minted Job-Seekers

 Avoiding the "Black Hole
         of HR"

 Is Your Elevator Pitch
         Taking You UP
         or DOWN?

 Time Management: Recipe          for a Well-Balanced Job          Search
 Getting Un-Stuck from your
         Rut!

 The Double-Whammy of
         Rejection and Isolation

 "Unemployed Need Not
         Apply" - Working Around
         This Scary Message

 Using Social Media to
         Enhance Job-Searching

 Warning: That Rant You
         Posted Just Went Viral!

 The Golden Rule for
         Business: Never Burn
         Bridges

 The Power of a Positive
         Attitude

 Why Job Hunting is a
         Consultative Sales
         Position

 Top 10 Most Helpful Things
         for Job Seekers

 Top 10 Most Annoying
         Things for Job Seekers

 New Year's Resolutions for
         Unemployed Job-
         Seekers

Job-Seeking Humor:
 Comic Relief: Volume 1
 Comic Relief: Volume 2
 Comic Relief: Volume 3
 Comic Relief: Volume 4
 Comic Relief: Volume 5
 Comic Relief: Volume 6
 "In Transition" and Other
         Awkward Euphemisms

 Candidates Gone Wild:
         Recruiter Horror Stories

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