Daily Management Review

93 Million Unemployed in the United States. So Trump Was Right?


Donald Trump made the following statement about the US economy in an interview with Time magazine:
- In reality, the unemployment rate in our country is probably 21%, not 6%, 5.2% or 5.5%. I'm talking about the real level of unemployment: in fact, I recently saw a graph of our real unemployment, and 90 million people do not work. More precisely, 93. If you count it up, our real unemployment rate is 42%.

The official unemployment rate in July was 5.3%, but Trump tells a different story. Calculating official unemployment, a person is considered unemployed if they are actively looking for work. And what about those people who are not looking for it?

Trump is right: a little less than 93 million people in the US do not have jobs. Trump could learn this figure of the graphs, published in the edition of The Wall Street Journal, which were compiled on the basis of monthly reports of the Ministry of Labour.

Only about 59% of Americans have a job, and only 62.6% are considered as a work force. Indeed, more than 40% of the population are unemployed. Economists are aware of this, but it is not always easy to find the data, so it is important to explain what is behind these figures.

Firstly, many people without any work are teenagers or retirees.

The Ministry of Labour does not believe these people jobless. If this is the university student or a 88-year-old grandmother, they are not considered unemployed for quite logical reason.

The reason for that 42% of Americans have no work is that the US has 46 million people aged 60 and older, and another 10 million adolescents.

However, many representatives of these age groups are really working, but really, should we consider all the teenagers and pensioners unemployed? Statistics of labor begins at the age of 16 years.

In the early working age, nearly 80% of Americans have jobs.

At the same time it should be noted that the number of people of early working age declines.

Economists explain this by the following factor: some stay at home and devote themselves to the children, the growth of the level of education means that young people are  studying, not working over a longer period of life.

At the time, undoubtedly weakening economy also plays a role, and many people simply stopped looking for work, many do not work because of a disability. Often, these groups overlap.

That is, some draw up a disability if they cannot find work. Some people prefer to stay at home with their children rather than pay for child care until the situation improves.

It is difficult to say exactly what causes underlie this situation. At the same time, economists have expressed different opinions as to what should be the ratio of employment to population.

Number of working adolescents and young adults up to 30 years decreased significantly. It also partly reflects the negative situation on the labor market, and the fact that many young people prefer to receive education.

Some young people do work, but many prefer to focus on education. Those students who do not work and prefer to give all their time to education, could benefit from the situation in the US economy in the long run due to a higher level of skills and knowledge.

But there is good news.

The employment rate of the population aged 55 and older is growing. Back in the mid-1990s, less than 30% of people in this age group were working. Since then, their share rose to nearly 40%.

But this is not good news, on the other hand. Many of these people simply cannot afford to retire, because they need the money.

Many Americans who like to work and are characterized by good health, prefer to work just for fun.

Thus, if you really believe Trump and accept as truth the fact that the US unemployment rate is 42%, the number of "unemployed" includes the following categories of citizens as university students, housewives and fathers who sit with the children, the disabled, older people - it will be the very 93 million people.

source: wsj.com