Illusion of Employment Emerges in the US

Data recently announced by the U.S. government showed that during the first week of 2012, first-time applicants for unemployment relief amounted to 399,000 people, the highest number of the past six weeks. These numbers are in contrast with the more optimistic data released earlier by the U.S. Department of Labor. These numbers, released on January 6, reveal that in the last 12 months, the unemployment rate for the non-agricultural sector in the U.S. dropped to 8.5 percent, the lowest level since February 2009. Moreover, the non-agricultural sector saw 200,000 people find jobs this month, of which 23,000 were added in manufacturing, the highest number in the past five months.

As a result of this discrepancy, the media has been attacking the U.S. government for fabricating employment figures as a means to cover up reality. What is the employment situation really like in the U.S.? Our reporter took these questions to the streets of New York to find out.

A coffee shop employee named Lani told our reporter that she was originally a white-collar worker in a company. But after being let go, she has been unable to find a suitable job. At the coffee shop, she is only a contract worker, meaning her job situation is very unstable. After her trial period, there is always the possibility that she will be fired. She said, “the current job market is causing a lot of people to panic. Everyone is afraid that they might lose their job tomorrow. Everyone seems to know someone who can’t find a job, including those people who originally used to work on Wall Street.”

A lawyer from an American law firm, Leonardo, told the interviewer that creating jobs and guaranteeing jobs is a long-term task. An upswing in the job market is not something that happens in one or two days. The recent positive employment numbers only brought a brief surprise. Cutting down on the government deficit and reinvigorating the job market is certain to be a long, drawn-out battle. The unemployed among the ranks of the “Occupy Wall Street” movement is increasing, but companies have open positions that are not being filled. Companies would rather divvy up the wealth they have now than add jobs. All these issues reflect the structural problems of the job market, which will hinder it from absorbing those who are newly unemployed as a result of the financial crisis.

Bill, a manager at an environmental protection company, told the reporter that everyone is worried about unemployment these days, with the middle class being the greatest victims of them all. Currently, most middle class families carry two jobs since every month they must pay insurance and medical costs, as well as repay their mortgage. If one of the members of the household loses his or her job, their house may be foreclosed. Additionally, in order to reduce spending, many American companies are using foreign contract workers to complete their production flow, resulting in one of the reasons that the American job market is having such a difficult time pulling itself together.

The people are skeptical about the validity of the employment data. The media and experts continue to point out that the government is using mistakes in the official statistical methods to create an “illusion of employment.” Analysts believe that the official unemployment rate dropped not because there was in increase in the number of people able to find a job, but rather because the number of people not willing to look for a job has increased. American entrepreneur Mike wrote that in December 2011, the real unemployment rate was actually 15.2 percent.

An insider told the interviewer that even though he believes the American unemployment rates have improved a bit, an 8.5 percent unemployment rate is still quite high. Recovery of the job market cannot happen without a recovery of job creating elements in all sectors. From the perspective of manufacturing, the recent return of manufacturing jobs might aid job growth. Caterpillar, GM, and Ford announced at the end of last year that they would be bringing back portions of their production sectors to the U.S. from China. However, as a point for growth for the financial industry, the outlook still looks weak. The wave of employee layoffs on Wall Street has yet to stop. Huge American investment banker Morgan Stanley recently announced that it will lay off 1,600 people in the first quarter. Merrill Lynch also plans to make layoffs of their own.

Overall, the labor market in the U.S. has seen some improvement, but still remains in a fragile state.