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Home Publications Blogs Beat the Press USA Today Didn't Notice That the Unemployment Rate Is Almost 10 Percent

USA Today Didn't Notice That the Unemployment Rate Is Almost 10 Percent

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Tuesday, 08 June 2010 05:10

With so much focus on the deficit it's probably hard to keep track of things like the unemployment rate. This is the likely explanation for a USA Today article that told readers in its first sentence: "last week's disappointing report on the job market may not be as dreary as it appears."

The article explained that many of the 411,000 workers who took jobs with the Census may have taken private sector jobs had they not had the option of working for the Census. According to the article, these people opted to take what they viewed as relatively high-paying and easy temporary jobs rather lower paying permanent positions in the private sector. It refers to evidence of a similar effect in prior years when Censuses were conducted.

It is important to note that the question is not whether the Census workers would have taken other jobs (they may have), but whether anyone would have taken the other jobs. The argument in USA Today is that low-paying jobs have gone unfilled because employers, who would have hired the Census workers, view other applicants as being unqualified. The comparisons to past Census years is dubious. The unemployment rate was 4.0 percent in 2000 and 5.0 percent when the 1990 Census was being conducted.

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written by izzatzo, June 08, 2010 9:33
It is important to note that the question is not whether the Census workers would have taken other jobs (they may have), but whether anyone would have taken the other jobs.


So when medical doctors, for example, aren't paid enough to "take a job", the interpretation in mainstream media is they'll all leave for something else, causing a "shortage" and the whole profession will dry up and everyone will suffer for lack of accesss to health care because of some kind of government interference in the "free market", such as a public option designed to introduce competition and choice for health care.

But when ordinary labor not in the professional class is not paid enough to "take a job", suddenly the whole "competition" thing is turned on its head, and the "shortage" that would have occured is magically transformed into an opportunity cost defined as government Census jobs that "crowd out" what could have been private jobs at full employment like they presumably did in '90 and '00.

In the first place, what the hell "jobs" are they talking about? What few are available, regardless of how low the pay, are snatched up by the desparate. It's not the same as medical doctors casually deciding what combination of private and public insurance to choose to pay their salary or drop out and cause a "shortage".

Imagine that. There's such a "shortage" of available labor due to all those jobs created by the Census, WalMart had to raise wages to record levels in a tight labor market in order to lure workers from other jobs. After all, they're rational and understand that their opportunity cost of sitting on the couch is very high and must be compensated with appropriate incentives.

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About Beat the Press

Dean Baker is co-director of the Center for Economic and Policy Research in Washington, D.C. He is the author of several books, his latest being The End of Loser Liberalism: Making Markets Progressive. Read more about Dean.

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