A bipartisan group of lawmakers has introduced a bill to examine how the Department of Labor calculates the official unemployment rate, and potentially reform and adjust how that calculation is made.
“While President Obama has made phenomenal progress on job creation, experts from across the spectrum recognize that the current unemployment rate does not match the situation for workers and jobless Americans,” said bill sponsor Rep. John Conyers, D-Mich.
Both Republicans and Democrats have been warning that while the official unemployment rate is 5.1 percent, that doesn’t necessarily mean the labor situation is settled. Many members have noted that millions of people either aren’t working or hold jobs they don’t want or that don’t pay them enough, and that some alternative measurement of the labor situation is needed.
Conyers tried attacking this problem last month with a bill to encourage the Federal Reserve to abandon any designs on an interest rate hike until unemployment is at 4 percent.
Conyers’ latest effort would attack the problem from the other direction, by assessing whether a different unemployment measurement should be used to reflect the uncertainty out there that millions of workers face. His cosponsors, including fiery figures of the economic left such as Rep. Marcy Kaptur, D-Ohio, and Republicans like Rep. Michael Dickinson, R-Pa., are opposed to the current “headline” measure of the unemployment rate.
“Unemployment numbers are carefully scrutinized and cited as an indicator of overall economic health. Many prominent economists, however, have criticized the number as being an inaccurate representation of the actual job market,” said Rep. Mike Fitzpatrick, R-Pa.
The bill encourages a new commission to focus on the nation’s declining labor force participation rate, and to divise a method to better chronicle underemployment.
The sponsors want the commission to examine and conceivably reform the “methods used for determining that an individual is or is not considered to be looking for work, including what constitutes actively looking versus passively looking or ‘discouraged’ and how to take into account the intensity with which individuals are searching for a job.”
Further, they want it to “develop a new method or methods for determining and reporting underemployment that takes into consideration workers who are not in jobs that match their skill set or education, and who are earning less than other workers in similar occupations or with similar skill sets and education,” the bill states.
They are not alone, and have been joined by the likes of presidential candidates Bernie Sanders and Donald Trump. Even as early as the 2012 campaign, surrogates for Mitt Romney’s campaigns were occasionally crying foul on how the unemployment figure was calculated.
Romney supporter former GE CEO Jack Welch even offered that he thought the numbers painted an intentionally rosier picture of the economy in order to aid President Obama’s re-election.
“Unbelievable jobs numbers … these Chicago guys will do anything … can’t debate so change numbers,” he tweeted.
