David Purtell column: The numbers behind the unemploymnet rate
Published 2:15 am Sunday, November 9, 2014
Rowan County’s unemployment rate was 6.1 percent in September, the latest figure available.
But what exactly does that number tell us? How can we take a single figure and judge the health of our economy?
The answer is we really can’t. The unemployment rate, released each month by the federal Bureau of Labor Statistics for the national, state and county level, has become more of a political weapon than anything else. And, like everything else that comes out of Washington these days, many people are skeptical of its value.
The good thing about the unemployment rate is that a whole bunch of data goes into calculating it — much of the data is collected by the Census Bureau and shared with counterparts at the state level who also collect data on the workforce.
And, best of all, the data is public, which means we all can examine it.
Deep within the halls of the North Carolina Department of Commerce is a group called the Labor and Economic Analysis Division, and these guys have all the fun when it comes to number crunching.
Let’s use their data to find some trends for employment in Rowan County.
We need to pick a starting point. Let’s go with January 2007 — a time when things were going pretty well in the county and before the devastation of the Great Recession set in.
In January 2007, an estimated (and they’re all estimates) 66,800 people were working in the county. The unemployment rate was at 5.2 percent with about 3,700 people unemployed. The size of labor force (employed and unemployed combined) was 70,500.
The sun was shining in Rowan County those days, but a storm cloud was looming just beyond the horizon.
Jump forward to January 2010 and it’s a whole new world — and not a pretty one. The county’s unemployment rate was above 14 percent, and over 10,000 people were without work. The number of workers had dropped by almost 6,000, taking the total to under 61,000 people.
Rowan County, and the rest of country, was staggering, beaten and almost broken.
But the heavy rain, fierce lighting and booming thunder of the economic storm began to weaken in 2010.
By the end of 2012, the number of working people in the county had grown to more than 63,000. Unemployment was down to 9.2 percent with 6,400 people out of a job.
Since then the unemployment rate has continued to drop, but the number of employed people in the county has hovered around 64,000. The number of unemployed people was 4,100 in September.
So unemployment is dropping, but job growth is stagnant. Where did those unemployed people go? They may have moved out of the county, retired, or died.
Another factor may be an increase in the number of discouraged workers: People who give up looking for work because of a bad economy. They don’t get included in the “official” unemployment rate, which is calculated by dividing the number of unemployed by the size of the labor force.
But the Bureau of Labor Statistics does release three other unemployment rates that include discouraged workers. One puts the nation’s unemployment at 7.4 percent, while another, which includes people working part-time because they can’t find a full-time job, puts the figure at 13.2 percent nationwide for October.
The federal agency doesn’t produce those figures at the state and county level.
Leave no doubt, things have gotten better. But right now the county, and much of the country, is like a boxer who took one on the chin and got knocked down … but not out.
We got back on our feet and made it through the round. Now we’re in our corner, recovering. There’s another round to come, and we’ll have our chance to punch back.
David Purtell covers business for the Salisbury Post. Contact him at 704-797-4264 or david.purtell@salisburypost.com