Hidden Unemployment

U.S. Unemployment Forecast 2017 Suggests
“Real” Unemployment Could Hit 30%
U.S. Economy - By Alessandro Bruno BA, MA | February 27th, 2017
U.S. Unemployment Rate Forecast for 2017 Is 4.6% But It’s Too Optimistic
The U.S. unemployment rate forecast for 2017 is 4.7%. That means no major change
from 2016. The official numbers show that unemployment was falling just before the
presidential election. The unemployment rate fell 0.3% in November 2016 compared to
October.
At first, the sheer magnitude of the improvement should impress. But, on closer
examination, it should raise concerns.
The unemployment rate in the U.S. and its purported improvements have a less
impressive explanation. The improvement over the past year has resulted, at least in
part, by a reduction in the numbers of people actively looking for jobs. Hiring has slowed
in 2016. (Source: “U.S. job creation weak, even as unemployment rate falls to 4.7%,”
CNN, June 3, 2016.)
In May of 2016, the economy added just 38,000 jobs. That was the lowest monthly job
number statistic since 2010. (Source: Ibid.)
Real Unemployment Rate Could Hit 30% by 2020. Trump Thinks It’s Already There
Trump is right not to trust the official statistics. He already believes the real U.S.
unemployment rate to be considerably higher. During the presidential campaign of
2016, Trump convinced many supporters that the real jobless figures were closer to
28%–35% than to official figure.
Five percent unemployment was the official target during the last administration. That
target has been reached and improved, but Steven Mnuchin, the Secretary of the
Treasury, has backed President Trump’s view.
“The unemployment rate is not real … I’ve traveled for the last year. I’ve seen this.” said
Mnuchin to the Senate Finance Committee. (Source: “Ahead Of Trump’s First Jobs
Report, A Look At His Remarks On The Numbers,” NPR, January 29, 2017.)
The real unemployment rate rarely has anything to do with the actual unemployment
rate. Confusing the two may have been one of the fatal mistakes made by Democratic
presidential candidate Hillary Clinton. In the months preceding the Democratic Party
convention, unemployment appeared to be going down.
For the record, in 2010, the economy was still in full post-2008 crisis mode. Thus, there
can be but one conclusion: U.S. jobless numbers dropped because too many
Page 51 of 149