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Jobless data show only part of economic pain

Job seekers read pamphlets as they wait in line to enter the HIREvent job fair at the Doubletree Hotel on August 10, 2011 in San Jose, Calif.

Kai Ryssdal: So here we are. Post-Labor Day. The time of year when news traditionally picks back up after taking the month of August off.

We've had no such breather this year, though. And even a brief perusal of recent headlines shows we're in for more of the same. The European debt crisis lingers. This morning, Switzerland -- of all places -- said it's going to intervene in the foreign exchange markets. And to top it all off, now the Post Office is talking about about shutting down? One hesitates to ask what could possibly happen next.

What's going to happen this week on the broadcast is more of our coverage of The Breakdown, our economy, one step at a time. Specifically: jobs. There was the dismal August unemployment report Friday. GOP candidates are coming out with their jobs plans. There's the president's speech Thursday night on the topic. Everybody says they want more jobs.

So as we start a week of unpacking the American labor market, we figured we ought to define our terms. First of all: who's not working. Here's Marketplace's Mitchell Hartman.


Mitchell Hartman: Among the 14 million Americans who the government counts as unemployed is Richard Andresen. He's 64, he's been a teacher, a salesman, a sailor -- and he hasn't worked for two years. I met him at the unemployment office in Portland, Ore.

Richard Andresen: I called an airline in California, they have an announcement at two different sites, and I used to work for the airlines, so I think it would be a good fit.

He's 'officially' unemployed because he tried to find a job in the last month.

Now meet Stephanie Thierault of Gloucester, Mass. She was a mortgage underwriter until she got laid off in 2006. She was looking for a job:

Stephanie Thierault: Until I got depressed, because it's like, they're not hiring me. The longer it went, they wouldn't hire you.

She's not actively looking, so she's not counted among the 9.1 percent of working-age adults who are 'officially unemployed."

Tom Nardone is with the Bureau of Labor Statistics.

Tom Nardone: You do have people who have stopped looking. We have seen an increase in that group of people who are 'marginally attached' to the labor force.

'Marginally attached': That's people who can work and want to work, but for some reason have stopped trying to work. But that's still not everyone who's looking for work. Nardone says you also have to add:

Nardone: People who are working part-time, so they are employed, but who would prefer to have full-time work.

Pushing the total unemployment rate right now to more than 16 percent.

And that's in spite of the fact that there are actually fewer Americans in the workforce than before the recession. 300,000 fewer, according to Heidi Shierholz of the Economic Policy Institute. She reckons there should have been millions more joining the workforce: teenagers and 20-somethings graduating school, 30-somethings returning to work after child-raising.

Heidi Shierholz: And we don't have a ton of good information on what happens to people who, maybe in better times, would have been in the labor market with a job, or at least looking for work.

Economist Gary Burtless at the Brookings Institution has some ideas.

Gary Burtless: We have a lot of people whose careers are being delayed, they aren't starting; people whose careers are ending years earlier than they wanted them to. It's hard to hold out a lot of hope for these people, given the anemic pace at which employers are adding to their payrolls.

When the economy finally does start to show signs of life again, some of those people will jump back into the job search, which could actually drive the unemployment rate higher.

I'm Mitchell Hartman for Marketplace.

About the author

Mitchell Hartman is the senior reporter for Marketplace’s Entrepreneurship Desk and also covers employment.
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First, thanks for this great episode of Marketplace. The real story of unemployment in this country needs to be told, and, going forward, the only number that should matter to anyone is the average length of unemployment, which is now above 40 weeks, and continues to rise. The very last comment by the woman who stated she has been unemployed for over 2 years was chilling. Anyone who talks about jobs and job creation needs to talk about it in the context of these individuals, otherwise he or she is just full of it.

This is the most over-run, laziest story the media publishes. Every time a media outlet talks about the unemployment rate, they point out how its not the whole story then find someone working part-time or who has given up to quote.

Unemployed means a particular thing in economics. You must be looking for work to be unemployed. People who have stopped looking or are working less than they want fall into different categories. This is not a weakness in measures of unemployment.

Given how the media defines unemployed, a third grader is unemployed. Someone who has never tried to find a job and has no intention of working in unemployed. Someone working 35 hours who wants to work 40 in unemployed. When you let a term mean anything at all, it means nothing.

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