Saturday, February 5, 2011

Current Population Survey

Each month the U.S. Department of Labor, Bureau of Labor Statistics (BLS) calculates unemployment rates and other labor force data.
The media gives wide coverage of the results of the Current Population Survey.

The Current Population Survey is conducted by the BLS, and the requirements they use to classify the employed take many people by surprise. Such qualifications to be classified as employed:

  1. If you did any work (even an hour) as a paid employee, or in his or her own business, profession, or on his or her own farm.
  2. If you worked without pay for 15 hours or more in a family-operated business.
  3. If you were temporarily away from your job or business due to illness, weather, vacation, labor management disputes, or personal reasons.


    So as we can see that even a person who just wants to do a limited amount of work, even 1 hours work will show up as "employed" in government data.

    When the fore-mentioned happens, the data becomes misleading, understating the true level of unemployment in the economy. This can affect different factors and could possibly change the decisions made by policy leaders effecting the outcome of new bills asking for new unemployment insurance extensions.
The BLS conducts the survey through interviews of people and is based off their responses.

http://www.bls.gov/home.htm

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