FROM ISSUE NUMBER 56 - SUMMER 1979 GO TO TABLE OF CONTENTS

TEXT SIZE A A A

CURRENT READING

The Distorted Unemployment Statistics

 

Economists have been puzzling for some time now over the anomalous behavior of the unemployment rate. The rate is supposed to be responsive to cyclical changes in the economy, yet in recent years it has failed to decline in proportion to the number of jobs created.  This has led many economists to suspect that non-cyclical factors, such as changes in the composition of the labor force, are distorting unemployment statistics. Monthly Labor Review published four articles in its March 1979 issue exploring the effects of several of these non-cyclical factors-demographic changes, government policies, and changes in the methods used to count the unemployedand a loose consensus emerged. These factors have indeed artificially increased the unemployment rate, in some cases to a significant degree, but because they all interact and overlap in ways that are not well understood, it is impossible to estimate their collective impact.

PDF Version To download a PDF of the full article, please click here.