‘Official’ state jobless count likely too low
unemployment

‘Official’ state jobless count likely too low


By Mal Leary
Capitol News Service

AUGUSTA, Maine — A federal Bureau of Labor Statistics survey may provide a more accurate picture of the state’s unemployment situation than the “official” rate released monthly by the Maine Department of Labor.

The state’s figures are based primarily on the numbers of people receiving unemployment insurance, but new data collected by the Bureau of Labor Statistics could broaden the state’s view.

Todd Gabe, an economist at the University of Maine, said the federal survey, which was started in 2007, measures areas such as people who have been unemployed longer than 15 weeks; workers whose temporary jobs are completed; workers who have part-time jobs and cannot find full-time work; and a growing sector — “discouraged” workers, those who have been unemployed for a long time and possibly have given up searching for work because they may be convinced there is nothing available.

“If the economy is going down, you have discouraged people leaving the labor force, so in some respects that understates the number of people out there that are looking for jobs,” Gabe said.

The first full year of the new federal statistics is for 2008, and the state just recently learned the federal government was collecting them. Current unemployment figures the state releases monthly do not include the new information.

“This is pretty new information for us that has been collected by our federal partner,” said Labor Commissioner Laura Fortman. “It is based on samples and the sample size is very small, so while it provides interesting information and can point to trends, we are reluctant to have people think these are absolute numbers.”

Gabe said the federal measures do provide a broader picture of what is happening in the job market. He said all the measures depend on surveys, including the “official” rate that is based on a census estimate of the size of the work force.

“All the measures have usefulness,” he said, “and all have their limitations.”

Ed Gorham, president of the Maine AFL-CIO, has long been critical of the “official” Maine unemployment rate. He said the current definitions leave out a lot of workers because they are not covered by unemployment insurance. He also pointed out that the state number released to the media every month does not measure the “discouraged” workers, which he believes is a growing group.

“They basically drop out of sight and off the radar screen,” he said. “I think there are far more out there than people realize.”

Fortman acknowledged she has long been frustrated by the problem of measuring and identifying “discouraged” workers. She stressed that even though they are no longer tracked by her agency like unemployment recipients, DOL provides job search services to everyone who seeks help.

“And I urge those people to go to a CareerCenter or go online and use the resources we provide for job search,” she said. “We want to help everybody that needs it, not just those receiving unemployment [insurance].”

In 2008, the average “official” unemployment rate for the year was 5.4 percent. That translates to about 36,000 Mainers out of work and seeking employment in any given month. Adding the estimated “discouraged” workers boosts that number to about 44,000 Mainers.

“And then there is the issue of the underemployed,” Gabe said. “Those are people who are working part time but can’t find a full-time job even though they want one.”

The 2008 average estimate of those that were unemployed, discouraged, in temporary jobs or underemployed is 10.9 percent. That translates to about 73,000 Mainers.

“When you look at those numbers of discouraged workers or people that are working part time and want to work full time, it gets to a number that more accurately reflects our instinctive sense of what is going on in the economy,” Fortman said.

Several lawmakers say they were unaware of the more extensive estimates done by the federal agency. Sen. Peter Mills, R-Cornville, is a member of the Legislature’s Labor Committee and said the additional measures will help lawmakers and state officials analyze what is happening in the state’s job market.

“Everybody knows there are exhausted benefits workers,” he said, “but I was not aware they were actually sampling these people to come up with an estimate of how many there are. That is of great interest.”

Fortman said the data are all public and available for anyone, including lawmakers, to review. She said it is not provided with the monthly news release from her agency because her staff questions its reliability from month to month.

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Comments
10 comments on this item

I have never believed the Maine Labor Statistics. With thousands of layoffs each month in Maine the statistics barely move. With such a small population in Maine you would think the statistics would be very volatile. Take for example when the tourist season ends and thousands are laid off from the tourist industry the unemployment statistics hardly move at all. I have always thought the unemployment rate in Maine is very underestimated or falsified.

The State of Maine numbers always seem to be off. They seem to not want the people to know the truth.

I have to agree the numbers never come out to be like they should be.

Knghtscross - I'm thinking the numbers will be closer to 14.5%. As far a tourism employment - a lot of these temporary employees return to their own states to go to college or back to the country they came from. Bar Harbor, for example, has a number of temporary guest workers in the summer.

The State has fairly well demonstrated that it can't count dollars (DHHS, Mainecare) - why should we be surprised that it can't count people?

I know there are alot of recent unemployed by the numers of people dropping off resumes. People that have laid off workers 1 or 2 at a time that havent made the news. I cannot recall a bigger flood of resumes in the last 30 years. That said I also wonder about the "discouraged worker" count. I know there is a big underground economy out there... people working under the table etc. Some folks find that kind of relationship "beneficial" Or maybe even supportig themselves illegally.... cultivating etc. Also how do they figure in people who have left the official workplace to start their own businesses? Small ones are dificult to count...

They should document the following:

- Mainer's who work and contribute to the state economy = __

- Mainer's who are capable of working but choose not to = ________________________________________________________

- Mainer's who don't work and are not capable to, but have in the past and earned their living = ___________________

- Mainer's who are lawers and politicians = ________________________________________________________

- Mainer's employed by the state = ______________________________________________________________________________________________

Knightscross,

That's not true. The unemployment rate accurately measures what the DOL reports its measuring. I suspect the numbers are relatively stable because they are seasonaly adjusted. The issue is are they measuring the right thing. I suggest they aren't. I want to know how many have no above ground source of income. I want how many people who are capable of being employed but aren't. Fit them into any classification you want. I expect the true "no source of income" figure is at least 3-5% above the official unemployment rate. It would be interesting to compare the poverty rate to the unemployment rate. I believe that 20% of people earn less than $11,000 per year. That's a much better indicator of economic activity.

Most of the time the numbers overestimate the unemployed. Reason is, a lot of Mainers fly under the radar. They don't report their income - or a substantial part of it - so the state and feds think they are unemployed.

Please, part of Maine hasn't got over the Great depression of 1929! Some people in Northern Maine only work during the few weeks of potato season, shoveling neighbor's roofs in the winter, and sells fiddleheads in the spring just to get by. Don't forget the ultimate "discouraged workers", the homeless. Most people of Maine have not been further north then Augusta and haven't seen what discouraged workers really means. Anyone that believed the Maine Labor Statistic's or the Federal labor statistic's for that matter has to be a retarded fool!

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