Measuring the Jobs Situation
Headline Unemployment Rate Is a Tiny Facet of Overall Picture Most people understand that a rising jobless rate is one of the hallmarks of a shrinking economy. But the national unemployment rate does not always reveal a complete picture of the jobs outlook. For example, when the downturn began in December 2007, the unemployment rate was a mere 4.9% — hardly the stuff of recessions. Employment tends to be a lagging indicator because most employers will cut back on other expenses in order to avoid layoffs for as long as possible. Moreover, when conditions begin to improve, employers may avoid…
