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In truth, last month's drop in the unemployment number was due largely to the evaporation of 1.2 million people from the labor force.


President Obama’s incredible shrinking labor force

In truth, last month’s drop in the unemployment number was due largely to the evaporation of 1.2 million people from the labor force.

President Obama last week brandished new jobs numbers as proof that his policies were having an effect on the unemployment rate, which the report said declined to 8.3 percent in January.

The president is right about one thing: his big government agenda and class warfare tactics are having an effect–but it’s not the one he claims. In truth, last month’s drop in the unemployment statistic was due largely to the evaporation of 1.2 million people from the labor force number. When people become so discouraged they stop actively looking for work, they are no longer counted as unemployed and the rate goes down even though Americans are hardly better off than they were before.

The rate went down in January because (apparently) 1.2 million people decided in a single month not to pursue work. This is the number, in effect, that President Obama is touting.

The January report caps an extraordinary decline in the participation rate that the Bureau of Labor Statistics (BLS) has been reporting under the Obama administration. Since January 2009, the BLS says more than five million people have dropped out of the labor force–the greatest decline in American history and the lowest participation rate in more than three decades. Only about 6 in 10 adult American civilians are counted as part of the labor force. 

A few more good jobs reports like this and we’ll have a 3 percent unemployment rate with nobody working.

The president assures us, however, the lower unemployment rate is actually evidence that his policies are successful. Asked Monday about the fact that unemployment had dropped in part because so many Americans left the labor force, unable to find jobs, White House Press Secretary Jay Carney said the decline in the participation rate could be an “economic positive” because some of it is “due to younger people getting more education.” Carney also tried to blame the massive exodus on Americans getting older—which they must have done at record levels in January to account for 1.2 million people retiring at once.

Those are pretty glib and grasping explanations for the single largest exit from the labor force on record—especially since it’s more than 4 times the number who left the previous month.

In reality, almost half a million fewer Americans are employed today than when President Obama took office. The real unemployment rate, counting those who are unemployed, underemployed, or have looked for work in the past 12 months but since given up, is closer to 15 percent. More Americans are relying on food stamps than ever before. Teenage unemployment during the Obama administration is the highest since records began in 1948, with almost one in four teenagers who wants to work today unable to find a job. 8.2 million Americans have only part-time employment either because they can’t find full-time work or because their hours have been cut back.

The president’s unrelenting assault on job creators has made a bad economy much worse. In the middle of the worst economic conditions since the Great Depression, he rammed through ObamaCare, spent almost a trillion dollars of “stimulus” indiscriminately, virtually took over the American auto industry, attempted to raise taxes on producers with carbon trading legislation, banned development of offshore oil and gas resources, passed the Dodd-Frank Act which crippled community banks, juiced up the regulatory powers of the Environmental Protection Agency, Food and Drug Administration and other bureaucracies—and lately, has taken to demonizing job creators with class warfare rhetoric while offering policy platitudes that do nothing to solve our problems.

These are the things the president is trying to tell us are responsible for last month’s drop in the unemployment rate? Having driven 5 million people out of the labor force, maybe on second thought he’s right.

Written By

Mr. Gingrich is the former speaker of the U.S. House of Representatives and author of To Save America: Stopping Obama's Secular-Socialist Machine, Real Change: From the World That Fails to the World That Works and Winning the Future (published by Regnery, a HUMAN EVENTS sister company).

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