The Ugly Truth Behind the January Employment Figures

By Joe Guzzardi
February 6, 2012

The Bureau of Labor Statistics’ report that January payrolls increased by 243,000 and therefore reduced unemployment to 8.3 percent is headline news.

However, two more foreboding but less publicized stories are in play that will have a long term negative impact on American unemployment. They are one, the true unemployment rate and two, the current administration’s determination to promote more legal immigration. The United States already accepts more than one million legal immigrants annually.

First, taken individually the numbers of jobs created and the accompanying unemployment rate decline tell only a partial tale. In January, the workforce decreased by a staggering and record setting 1.2 million hopeless Americans who have given up their search. But the BLS doesn’t include drop outs as part of its unemployment calculations. As long as that crucial variable is omitted, the unemployment rate will drop month after month.

Tellingly, the Zero Hedge financial website predicted that as long as the BSL uses incomplete data, by November America could “officially” have zero unemployment.

The BSL also overlooks population growth which jumped by more than one million in January. In other words, about four times as many people were added to the nation’s population last month than jobs created.

The most comprehensive jobs formula is the employment-to-population ratio which remained static at 58.5 percent. The number without jobs has also remained steady at 41.5 percent. More significantly, the overall jobs’ participation rate as measured by its percentage of the total population accelerated to a 30-year low of 63.7 percent.

Looked at differently, a year ago when the unemployment rate was 9.1 percent, 99 million people didn’t have jobs. While the White House claims that unemployment has dropped to 8.3 percent, the numbers of jobless has risen to more than 100 million.

The second variable in American jobs loss is current immigration policy. More immigration means fewer employed Americans. Several months ago, the Department of Homeland Security, with the president’s blessing, began the process now known as prosecutorial discretion, a form of backdoor amnesty. The DHS “forgave” certain Illegal aliens who had been targeted for deportation with the understanding that they were “low risk,” although that term is broadly defined to potentially include almost everyone. As a reward, the pardoned aliens will receive work permits. Since a large percentage of aliens are unskilled, they’ll eventually compete for minimum wage jobs with already struggling Americans.

At the same time, President Obama is determined to increase legal immigration in the skilled category. Since the federal regulations governing immigration are dry and confusing, the administration plans to pull this off with little notice.

The administration proposes to 1) expand eligibility to include a 17-month extension of foreign student visas for those with degrees in science, technology, engineering and mathematics, the so called STEM fields, 2) provide work authorization to H-1B visa holders’ spouses who are currently not allowed to work and 3) extend the time limit that entrepreneurial visa holders can remain working in the United States.

Collectively, Obama’s policies means that more and more legally authorized workers will be going toe-to-toe with Americans looking for jobs in a shrinking market.

The U-6 unemployment rate that measures those who are “marginally attached” to the labor force is 16.2 percent, a total that should alarm the White House and Congress. Instead, American leaders continue to be obsessed with promoting more immigration which translates to fewer American jobs.

Joe Guzzardi has written editorial columns, mostly about immigration and related social issues, since 1986. He is a Senior Writing Fellow for Californians for Population Stabilization (CAPS) and his columns are syndicated in various U.S. newspapers and websites. Contact him at [email protected].