Will the national unemployment rate continue to steadily decline?
Beyond the shadow of a doubt, January’s BLS jobs report was among the most optimistic that has been released since the end of the ‘Great Recession’ more than three years ago. Approximately 141 million Americans were employed last month, as the national unemployment rate continued to trend downwards.
But, despite all of the positive news that has recently been mentioned by various media outlets, which negative aspects of the report will affect the future of the national economy – and how will they influence economists’ projections for the remainder of 2012?
Although the national unemployment rate is currently lower than it has been in years, the rate does not include the 8.2 million individuals who must now work part-time hours as they have been unable to acquire a full-time position despite applying regularly.
The rate also doesn’t include the 2.8 million Americans who have not searched for employment throughout the last four weeks, even though they are physically able to work on a full-time basis. In addition, roughly 1.1 million Americans are “discouraged workers” who have completely given up on the prospect of finding a new job, at least for the time being.
If all of these individuals are added to the present total number of jobless Americans, the unemployment rate is actually 15.1 percent—a much different number than the 8.3 percent announced in the report.
Earlier this year, the Congressional Budget Office predicted the unemployment rate would increase to 8.9 percent by the end of the year. The Federal Reserve’s and Moody’s Analytics’ projections were slightly more positive, as they believed the rate would range from 8.2 to 8.5 percent by December 2012.
Still, despite economists’ concerns, Alan Krueger, Chairman of the Council of Economic Advisers, remains optimistic about the nation’s economic future.
“The economy is continuing to heal from the worst economic downturn since the Great Depression, said Krueger. “It is critical that we continue the economic policies that are helping us to dig our way out of the deep hole that was caused by the recession.”
So, what exactly does the future hold? Will the unemployment rate continue to decline – or will it once again uptick to levels that have not been measured since last summer? And, how will the rate influence this November’s election results?
Stay tuned.
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