0

Countless people talk about unemployment:

  1. They said they applied hundreds jobs but never received response.

  2. They said they applied about 500 jobs with 3 interviews but still unemployed.

  3. More terrible cases.

But most job statistics tell the unemployment rate is low.

Are the statistics true?

closed as too broad by dwizum, David K, Dukeling, DJClayworth, J. Chris Compton Jan 22 at 20:18

Please edit the question to limit it to a specific problem with enough detail to identify an adequate answer. Avoid asking multiple distinct questions at once. See the How to Ask page for help clarifying this question. If this question can be reworded to fit the rules in the help center, please edit the question.

  • 2
    In which country / region etc.? – Anne Daunted Jan 22 at 18:24
  • Unemployment rate is the ratio of jobs to applicants. Low unemployment means there are a lot of jobs and not enough people to fill them. So, a person could apply to 500 jobs and not get one of them. They could be applying for jobs that just aren't the fit for them. Now, if it was 500 people applying for one job, that's a high unemployment rate. – SiXandSeven8ths Jan 22 at 19:09
  • 3
    Those things don't contradict one another. An unemployment rate of 1% would be quite low, but if you have enough jobs for 99% of people, that would leave the "worst" 1% of people unemployed no matter how many jobs they apply to (it's a lot more complicated than that in real life, but the basic idea applies). – Dukeling Jan 22 at 19:15
8

To the best of the knowledge of everyone outside of whatever government labor statistics office we're talking about, the statistics are true.

There are many things which can cause individuals, including seemingly large numbers of individuals, to experience prolonged unemployment in a low unemployment job market.

The first is that only people who are enduring prolonged unemployment are going to talk about it. I have a job, a lot of people here have a job, we're not talking about how long we haven't had a job. This is the most likely reason -- self-selection in discussions about being out of work for an extended period.

Other than self-selection issues, there can also be issues with specific sectors of the economy contracting -- the American automobile industry seems to be going through a bit of a contraction at the moment. And as with the first answer, if you are a car builder and car builders are losing jobs, it may look like there aren't a lot of jobs.

And finally -- and this by no means the last possible explanation -- there can be issues with classes of workers having more difficulty due to discrimination, biases of other forms, or just the nature of being a recent graduate with no experience and struggling to find that first open door.

Taken as a whole, the American labor market is currently very tight. There are millions more jobs than potential workers and qualified candidates in fields with job openings should have very little difficulty finding work.

  • 4
    and one more, ppl flipping burgers and pouring lattes to keep food on the plate while looking for a 'real job' in their field, aren't unemployed. – Affe Jan 22 at 18:11
  • There is a statistic which measures that -- "under-employment". The under-employment rate has also been trending down. We really need more information about these chronically unemployed people to answer the OP. – Julie in Austin Jan 22 at 18:16
  • @Affe So how do you count the people work at Burger King? If you aren't going to call them "employed" what do you call them? – DaveG Jan 22 at 19:21
  • 2
    @DaveG my point was, my perspective, a lot of the people frustrated with job searches are often looking for their first entry level job in a new field. These people are often either still counted as full time students, or still employed in their previous field, or under-employed, from the perspective of the statistics. Not everyone ranting about how hard it is to break into industry-X is necessarily un-employed at the time of the rant. Anyway, sorry for sidetracking from your very good answer Julie :) – Affe Jan 22 at 19:24
3

When people talk about things, those are anecdotes, not hard data. Some people do have extreme difficulty in finding jobs, but you don't know if that person has been fired from 4 straight jobs, has horrible mistakes on their resume, is applying for jobs he or she isn't qualified for, is wildly exaggerating, or any number of things that might explain the difficulty.

If you're curious about job prospects in an industry, look into studies on the subject and employment reports instead of focusing on hearsay and you can be more confident in what you're reading.

2

In my country, the statistics portray what the incumbents want them to show. There are actually plenty of analyses by renowned specialists and even reports by the public television and radio that show how labor statistics are manipulated.

In addition to Richard's good points, in my country they even created a system where the unemployed can work for like 400 EUR/ month and is not considered unemployed then. 400 EUR/ month is nothing, it's a bit more than the grocery for a month bought in the cheapest discounter, but you are made to accept this kind of position by the employment agency - if you don't you can lose your benefits. So you don't have a real job, don't get a real salary but you are not included in the unemployment statistics.

Another problem are unpaid internships. I know in some countries people doing them aren't considered unemployed.

Additionally, there's a problem of the employment agency forcing people to work in professions much below their qualifications. You can say "no" but then, again, the agency can cut your benefits. So qualified people with degrees work as cleaners and similar and, as a result, aren't included in the unemployment statistics.

You see, it doesn't make much sense to discuss the topic without knowing where you are, but it can be concluded that states have plenty of means to make the unemployment statistics look how they want them to look without improving the situation of job-seekers.

2

There are several things to understand.

The unemployment rate is simply people on unemployment as a percentage of those employed.

The unemployment rate does not include:

  • People who have exhausted their benefits
  • People working part time because they cannot find full time employment
  • People collecting disability benefits
  • People who are underemployed, like software engineers working in retail

In addition, while the overall unemployment rate may be low, that doesn't mean that every industry is doing well. Economies usually see growth in some sectors while seeing a decline in others. For example, in the USA in the 1990s, while IT was booming, the manufacturing industry continued to shrink.

Also, when the unemployment rate drops, wages go up, and people who have been collecting some kind of benefits often go off the roles and get employment. This also isn't counted.

Finally, there's what is called the "Labor participation rate", which is the real indicator. It is a function of people working vs people of working age. This one catches everyone.

So, if the unemployment rate is, say 4.0%, and the labor participation rate is at 63%. there is far more room for those people to jump in and make the competition more fierce than if the unemployment rate is at 4.5% and the labor participation rate is at 78%

Not the answer you're looking for? Browse other questions tagged or ask your own question.