Black’s assertion came in an opinion article that decried the decline in the worker participation rate. As we have noted, this previously obscure data point has seeped into GOP talking points as the more closely watched unemployment rate showed steady improvement in 2013. The official rate is now 6.7 percent, or about 10.3 million unemployed.
“In fact, if the same percentage of people were in the labor force today as there were in 2009, our unemployment rate would be an astronomical 10.8 percent,” Black wrote. “This is in stark contrast to the administration’s prediction that his 2009 ‘stimulus’ legislation would have lowered unemployment to just 5 percent today.”
In that one paragraph, Black managed to evoke two claims that we have found dubious in the past.
In 2012, GOP presidential nominee Mitt Romney earned Two Pinocchios for making a similar claim about the unemployment rate. The problem is that the worker participation rate has declined in large part because of the retirement of the Baby Boom generation, so you cannot easily blame President Obama for long-running demographic trends. (Still, this is not just a demographic story: The number of Americans working or actively seeking work has actually fallen faster than demographers had predicted; the participation rate for workers between ages 16 and 54 fell sharply during the recession and still has not recovered.)
As for the administration’s “prediction,” we have noted repeatedly that this was a projection issued on January 9, 2009 — before Obama even took the oath of office–by two aides, Christina Romer, the nominee to head the Council of Economic Advisers, and Jared Bernstein, an incoming economic adviser to Vice President-elect Biden.
The 14-page report thus was not an official government assessment, or even an analysis of an actual plan that had passed Congress, as Black claims. Instead, it was an attempt to assess the impact of a possible $775 billion stimulus package and how much of a difference it would make compared to doing nothing. The administration certainly embraced the paper in later testimony, yet we have never found any citation of the unemployment projection by any administration official.
Okay, but what about this idea that there are “91 million Americans who are out of the workforce and stuck on the sidelines”?
The Bureau of Labor Statistics does show that there are nearly 92 million Americans out of the workforce. But dig into the numbers and it is clear that it’s silly to say all of these people are “on the sidelines” and need action from the president and the Congress.
This BLS document shows that the civilian noninstitutional population—essentially, people over the age of 16–is nearly 247 million. The civil labor force is 155 million, with a participation rate of 62.8 percent. So that leaves nearly 92 million “not in the labor force.” What does that mean?
Essentially, it means everyone above the age of 16 who is not working. The BLS breaks it down even further, and it quickly becomes clear that the vast majority of these people are retired or simply are not interested in working, such as stay-at-home parents.
•6 million want a job now but cannot find one.
•2.4 million did not actively search for work.
•1.5 million did not search for work because they are students or left the job market for family reasons, illness or some other factor.
•900,000 are discouraged and think no job is available.
Add that up, along with the 10.3 million who are unemployed, and then maybe you could say there are 21 million people who are “on the sidelines” of the job market. But the other 70 million people have permanently left the work force.
Tom Flanagin, press secretary for Black, said that “we certainly did not mean to mislead, as the piece was written from beginning to end from the standpoint of labor force participation, not the total number of unemployed.” He added that “our point being in this piece that today’s unemployment rate is misleading as it is not reflective of a broader problem in today’s economy, which is that so many people have given up looking for work. We believe that if the President and the Senate were to act on our House passed jobs bills, we would create an environment where businesses would be in the position to expand and we would see the size of our labor force.”
The Pinocchio Test
Black may have not intended to mislead, but she certainly did so by using the 91 million figure in a wholly inappropriate manner. She did not only say that 91 million people were not in the labor force, but she said these people were “on the sidelines” and would benefit from government action. She cannot with a straight face argue that all of those people want a job; in fact, the vast majority are simply retired. She only barely escapes Four Pinocchios because this is a BLS figure.
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