Ask Jean: Understanding Jobs Reports
“Jobs reports are always oriented towards claims for unemployment. Why don’t they report the employment number instead? Isn’t that a better indicator of the economy? Unemployment does not take into account those leaving the job market, falling off the unemployment rolls, etc.”
– Chaz
I think the confusion here stems from the fact that in the media, you often hear about the unemployment rate. But the Bureau of Labor Statistics, which tracks employment and releases the national unemployment rate every month, actually accounts for people who are employed and people who are unemployed.
“We take a monthly survey of households that asks people if they worked during the week that includes the 12th of the month. If they did not, and they are looking for work, they are counted as unemployed regardless of whether they received unemployment claims or not,” says Martin Kohli, a regional economist with the bureau.
In fact, the jobs report that the bureau puts out each month doesn’t use unemployment insurance claims figures at all. That wouldn’t be accurate, because unfortunately, claims often run out before people find work – we’ve seen this happen a lot during the current economic downturn.
How it works: The BLS does a Current Population Survey, contacting a sample of 60,000 households, or 110,000 people. The interviewers ask questions to help them determine if the people in that household are employed (they have jobs), unemployed (they are jobless, looking for jobs, and available for work) or not in the labor force (they are neither employed nor unemployed, which in most cases means they don’t have a job but they’re not looking for one. Stay at home parents, for instance, might fall into this category). They are then classified for the monthly report.
If you’re interested in learning more about how this information is collected, read the FAQs here.
