Tuesday, July 28, 2009


News is that the local unemployment rate is up a tenth of a percentage point to 7.6%. The "worst in 23 years" is the quote. True enough although we are talking a change that is awfully close to rounding error over the previous month*. As I said before, it remains 1.9 percentage points below the national unemployment rate, a statistic that can't be matched since the mid 1970's. Does not mean that higher unemployment rate of late is good, but a lot of things (especially things like migration) are dependend on how we are doing relative to places we usually trade population with more than the absolute levels.

What is scary is that the latest unemployment rate for Detroit is that it jumped more than 2 percentage points over the previous month and is now just over 17%!! That is now well over double our local unemployment rate and rapidly approaching the highest calculated unemployment rate here during the worst of the early 1980's.

Things to look for in coming months. July data will have beginning palpable impacts of casino employment. I also want us to get credit for all the G20 employment. Think about it. Those thousands of folks visiting will all be employed, though they won't count on our labor force metrics... But will there be local employment impacts in the near term from the G20 related activity?

* Technically the unemployment rate between May and June here went from 7.497% to 7.559%. But the data isn't really precise enough to report that many significant digits. But I'm serious. I bet that if the survey caught one more person working last month the change would go away in the reporting.


Blogger Unknown said...

Are unemployment data from the 70s even comparable to current data? I know the federal government has changed how the rate is calculated. Has the city as well? My understanding (and I confess it may be poor) is that the new calculation method underestimates unemployment by older standards.

Tuesday, July 28, 2009 12:51:00 PM  
Blogger C. Briem said...

there are always lots of issues with comparisons over long periods. Comparing the past to the present, fundamental differences in labor force participation give a very different meaning to unemployment and it's impact even if 'perfectly measured. But as for underestimating systematically in what is being measured, it depends a bit but at it's core the questions asked within the last couple decades get to the same metric. You see a lot of media talk of underemployment and hidden unemployment, but the study of discouraged workers in particular is not a new thing. If the unemployment rate here is biased downward because of underemployment or discouraged workers, it was really biased downward in the 80's due to same.

but for sure, there is a lot of sausage making in coming up with unemployment rate numbers.

Tuesday, July 28, 2009 12:58:00 PM  
Blogger C. Briem said...

also realize that in that relative unemployment metric I mention.. one would presume whatever change has happened over the decades has impacted both local and national unemployment rates. So comparing the difference may account for that since it would bias the numbers the same one could assume. Kind of a fixed effects thing.

Tuesday, July 28, 2009 1:11:00 PM  
Anonymous DBR96A said...

Dammit, I want Pittsburgh to be a full 2% below the national average! I will go on a hunger strike until it happens!

Wednesday, July 29, 2009 1:10:00 AM  
Blogger C. Briem said...

the 1000 casino jobs starting in July may be that extra 0.1%

Wednesday, July 29, 2009 8:11:00 AM  

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