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U.S. Government Undercounted Unemployment Statistics

By Roy D. Follendore III

Copyright (c) 2003 by RDFollendoreIII


July 20, 2003

There is no noise in this statement because it is a simple issue of human statistics. When people are not counted, they do not count.  When the same management that must be held responsible for the state of our economy are also responsible for counting the unemployed you can bet that the unemployed will be undercounted. The reasons are clear. The unemployed are a powerful political message when campaigns begin. The future of our economy looks brighter than it actually is when the unemployed have not been accurately counted and political regimes find it easier to get reelected during an economy with low unemployment.   

The unsaid underlying theme that runs through our unemployment news is that Americans have lost control of our Government and their representation in both government and industry. What has become more important than the news is the public relations spin.  Political rhetoric has become more important than issues.  In the eyes of those who are in the ranks of the unemployed, maintaining the political correctness of that spin has become more important to our leaders than democracy, peace, justice and true patriotism.   

Unemployment begins with the basic jobs and there has been a sell off of our technical industries.  It has been reported in CNN that 27,000 jobs were moved overseas in 2000 and  Forrester Research predicts that number will mushroom to 472,000 by 2015, if the sell off continues. These are solid income producing jobs that house, feed and cloth American families.  These are positions that will not be coming back.   Ross Perot explained what this would do to the American economy but Americans refused to listen. The assumption is that what is good in the short run for the investor capitalists is good for America.  The assumption is that the technical industries will continue to produce jobs and wealth so that American employees will keep the better jobs.

The people who made vast fortunes during the 1990's are often in the news claiming the significance of their losses.  Where they once held stock market accounts worth tens of millions of dollars, today they only have a few million. The issue that is being ignored is that for the vast majority of this class of people, while they may have fallen farther, they did not hit the bottom.  They still live in their luxurious chalet styled homes and drive their over priced cars. They are still out there in the hundreds of thousands, lurking over the latest stock market prices, speculating over the stock values of corporate decisions that in their eyes make them worth investing.    

The problem with all of the economic assumptions being made by these fat cats is that their judgment is biased.  Their perspective is representative of the few who have not and can not lose their jobs.  Regardless of the economy, this class of American aristocrats always feel secure in their personal future. And though, they may have been driven into their protective shells by the stock market free fall that they experienced, these are and never really were risk takers.  They are economic and statistical opportunists. These individuals are looking for the absolute opportunity of risk free profits. And moreover, they want to see numbers reflect this investment strategy. 

For publicly held businesses who are  listed on stock exchange, their responsibilities to stock investors have become their most important form of income. They speak to their "obligation to their stockholder." The human tragedy of this formula is the drastic conceptual distance between the investor and the affected unemployed.  The employment formula for a surge in economic investment growth is simple. Through technology, investors organize themselves to encourage lean and hungry companies operating in societies where there are unemployed skilled workers ready and willing to become engaged at reduced rates. American companies know this and respond by "cutting the chaff" by internally eliminating "undesirable" and "unnecessary" positions, even if it reduces their ability and obligation to compete.  They can do this because they make it appear on the accounting books as though they have cut their overhead.  

This is accomplished through the codeword of outsourcing, replacing the internal day to day technical support and technical operations positions offshore. The advantage is that the employment overhead is drastically cut in times of low production.  Even though this employment overhead in times of production is insignificant, the "formula" seeks zero costs.  The disadvantages, particularly in American technological companies is that control and industrial leadership is given away.  Ultimately in terms of the politics, this is of course just an old and effective investment accounting trick perpetrated on the statistic of the unemployed.   

The way that employment statistics are created in America is this... Everyone in America is considered happily employed. When an American loses his work he or she becomes unemployed.  When his/her unemployment benefits run out he becomes underemployed.  When he or she is no longer considered, he no longer counts.  The way that the administration of the Federal Government counts the unemployment rates in the United States is similar to the way that they counted Iraqi weapons of mass destruction.  The statistics are generated the way that they choose to benefit themselves and their goal of staying in power.

To hear the politicians, today there are no job problems in our country.  We are all better off than we were before the current administration was given power. The failure of technological corporations in the past three years is said to be just a downturn.  The truth is that America is on the brink of an economic collapse because our leaders are more interested in political doctrines and rhetoric of power.  Americans have had to live on borrowed money that is running out.  The jobs that were lost by companies that failed began the unemployment of the best technical minds in the World.  Together with that cause of unemployment, the positions that are continuing to be lost by eliminating American technical positions overseas represents the fundamental failure of American technological leadership. 

American Government and Corporate leaders have refused to recognize that they simply can not afford to waste the future of Americans. On one hand, they have worked in favor of the capitalist investors at the expense of the average employee.  On the other hand, they have bought into the socialist ideologies of the Internet and in doing so forgot the first rule.  We Americans must first take care of our own economy before we can take care of others.  Delivering jobs to people overseas in the name of "Globalism" at the expense of our economy is a terrible idea.  It is our ultimate American formula for failure. The powers that be have forgotten that the world already depends on America and because of that, it depends on Americans to remain strong.  If our American economy fails, it will have tremendous repercussions everywhere.  

Unemployment and world failure begins in subtle and seemingly insignificant ways.  The entry level college kid that did not get an employment opportunity this summer lost their chance to be counted in the ranks of the unemployed.  They have lost that most important opportunity for their first real employment experience to adults trying to hang on to their homes.  When these students get out of college they will have incurred more in debt, and will be less experienced than the previous generations. After all of their efforts, they will not find the same entry level opportunities because these are now considered as unimportant. When they do find work, they will become stuck in lower paying jobs.  This generation of young people will lose their place in American society and will eventually be forced to work for more fortunate younger generations. Americans can and will lose it's edge if Government and Industry do not step in right now to do something about this mess.

Knowledge is power, but it is also a responsibility.  Right now, you probably know of friends, colleagues and associates who are either "underemployed" or unemployed.  If you want to protect yourself and help those people then it is time to step up to the plate and speak out about economic issues.  If you know what is going on, you can feel the weight of the future of America in your obligation to make a fresh approach to solve the problems in our economy the fundamental political issue that is needs to be.  There is a common cause that exists here.  If you are a young American starting out or a senior American starting over, you both deserve the opportunity for that chance at success on a level playing field.  If you are an already successful and/or wealthy American, then you should already be aware that the wealth that you have is founded on economic well being of this nation.  

It is about time that all politicians understand that this is not an issue that will go away without real action.  Cutting interest rates has failed to spark the growth that is needed.  There is a limit to interest rate cuts. Interest rates do not directly affect those who need help now.  The unemployed do not have a fair opportunity to take advantage of the interest rates. What is required is a systematic approach to combating unemployment within the policies of Government and Business.   It is time to put a halt to greedy business policies and practices that fail the employee.  This is a time for the social barriers of age, experience and income to to fall and for all to work together and be counted as more than a manipulated Government statistic.  




Copyright (c) 2001-2007 RDFollendoreIII All Rights Reserved