Unemployment is not improving.  Period.

Why?  Because the total number of people in the labor force has dropped by 1.2 million individuals.  In fact, since January 2009, more than 5 million people have left the labor force, which is the greatest decline in American history.

You calculate the unemployment rate by dividing the number of unemployed job seekers by the total labor force.  The only reason unemployment dipped to 8.3% in January, 2012 (U3), is because there were less people in the total labor pool, thus the percentage dropped.  It’s merely a slice of the pie and not the full pie.  It’s artificial and not home made pie.  Be careful what you eat.

Let’s call a spade a spade, or better yet, a job a job.  The media and some politicians on both sides rarely report on the complete unemployment benchmark known as “U6,” which is now at 15.1%.   The U3 numbers always makes a bad situation look better.  It’s kind of like Clearasil.  The zit is covered but it’s still there.

In fact, the labor force as a percentage of the total population is at the lowest level in 3 decades, at 63.7 %.  All these numbers come from the BLS (Bureau of Labor Statistics).

To get the full and accurate picture, you must measure the total number of people who want a job, but can’t find one.  You must use the U6 number, which is comprehensive and displayed below:

U6 Unemployment Trends

Does 15.1% real unemployment sound like a recovery to you?  There is no such thing as a jobless recovery.  No way.  No how.  Always make sure you check the real unemployment benchmark, the U6 and not the U3 numbers.  U3 paints the artificial picture.  U6 paints reality.

Plan your small business marketing strategy around reality, not fantasy.  Again, I’m not trying to preach “doom and gloom.”  I am trying to preach reality.

The best navigation relies on knowing how big the storm is.  That way you ultimately get to your destination safely.

When the sun is not shinning, be careful how you fly and what maps you read…