Labor Force Disappears in Obama's Depression
The big news in Friday's employment report was not the miserable 115,000 jobs the economy added in April, but the disappearance of 340,000 workers from the labor force. We haven't seen unemployment on this scale since the Great Depression. Indeed, since Obama took office, the labor force participation rate has fallen from 66% to 63% as almost 5 million American adults stopped looking for work. About a fifth of working-age Americans aren't working -- and a fifth of all personal income is transfer payments. These numbers are astonishing and without precedent. If they continue, America will go bankrupt. Obama's hope for re-election lies in dependency. No one could run for re-election as dogcatcher with this record -- except for the cynical presumption that Americans have become so dependent on the state that they have lost hope of working again, and will vote for more state dependency.
If you're not scared, you haven't read the numbers. Here they are, courtesy of the St. Louis Fed's excellent free data base.
Not since the 1970s has the overall labor force participation rate been this low. As women began entering the labor force in large numbers, the overall participation rose. Truly alarming, though, is the labor force participation rate for men:
This stabilized in the mid-70% range during the 1990s and 2000s, but has just fallen below the 70% mark for the first time in history. Again, the number means that 3 out of 10 working-age American men who are not in prison or the armed forces are not counted in the labor force. They are not looking for work to begin with.
For Americans with only a high school diploma, the results are even more dismal: fewer than 3 out of 5 Americans with only a high school education are counted in the labor force.
For Americans without a high school diploma, the labor force participation rate is only 45%. Fewer than half are counted in the labor force, that is. The official unemployment rate for the least-educated cohort is 12.5%. That means that fewer than 2 out of 5 adult Americans without a H.S. diploma not in the military or prison actually have a job.
And for African-Americans, the labor force participation rate is only 60%.
The official unemployment rate is 8.1%. Include so-called discouraged workers, and it jumps to 15%. And if we include so-called long-term discouraged workers, the part of the adult working-age population that simply has disappeared from the labor force, it jumps to 22%, according to the website Shadow Government Statistics:
America is becoming a nation of dependents. If more than a fifth of adult Americans aren't working, what are they living on? The answer: they are living off transfer payments. A fifth of Americans aren't working, and a fifth of personal income is transfer payments. The math is simple.
TRANSFER PAYMENTS AS A PERCENTAGE OF DISPOSAL PERSONAL INCOME