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John Williams continues:
“The SGS estimate generally is built on top of the official U.6 reporting, and tends to follow its relative monthly movements. Accordingly, the SGS measure will suffer some of the current seasonal-adjustment woes afflicting the base series, such as recent distortions in adjusted reporting of part-time employment for economic reasons. Nonetheless, there continues to be a noticeable divergence in the SGS series versus U.6. The reason for this is that U.6, again, only includes discouraged workers who have been discouraged for less than a year.
As the discouraged-worker status ages, those that go beyond one year, fall off the government counting, and new workers enter “discouraged” status. Accordingly, with the continual rollover, the headline workers flow into the short-term discouraged workers counted in U.6 continue, and from U.6 into long-term discouraged worker status (SGS Measure) at what appears to be an accelerating pace.
An unemployment rate above 22% might raise questions in terms of a comparison with the purported peak unemployment in the Great Depression (1933) of 25%. The SGS level likely is about as bad as the peak unemployment seen in the 1973 to 1975 recession. The Great Depression unemployment rate was estimated well after the fact, with 27% of those employed working on farms. Today, less that 2% work on farms. Accordingly, for purposes of Great Depression comparison, I would look at the estimated peak nonfarm unemployment rate in 1933 of 34% to 35%.
Construction activity remains severely impaired—stagnant near the cycle lows.
In line with the ongoing bottom-bouncing reported through February in construction spending, and suggestive of that pattern having continued in March, seasonally-adjusted March construction employment remained stagnant. Construction jobs purportedly dropped by 7,000 to a level of 5.551 million, per today’s labor data report.”
The above was just a small portion of another top shelf report by John Williams of Shadowstats.
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© 2012 by King World News®. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed. However, linking directly to the blog page is permitted and encouraged.
Eric King
John Williams - Unemployment Rate at a Staggering 22.2%
John Williams, of Shadowstats, notes that manipulated government statistics are not changing the fact that the true SGS Unemployment Measure now sits at a staggering 22.2%. Williams also demonstrates that despite the hype from Wall Street about a recovery, parts of the economy remain collapsed. Here is what Williams had to say about the situation: “Adding the SGS estimate of excluded long-term discouraged workers back into the total unemployed and labor force, unemployment—more in line with common experience as estimated by the SGS-Alternate Unemployment Measure—notched lower to 22.2% in March from 22.4% in February.”
© 2012 by King World News®. All Rights Reserved. This material may not be published, broadcast,
rewritten, or redistributed. However, linking directly to the blog page is permitted and encouraged.
April 9, 2012
