John Williams, of Shadowstats, notes that manipulated government statistics are not changing the fact that the true SGS Unemployment Measure now sits at a staggering 22.2%. Williams also demonstrates that despite the hype from Wall Street about a recovery, parts of the economy remain collapsed. Here is what Williams had to say about the situation: “Adding the SGS estimate of excluded long-term discouraged workers back into the total unemployed and labor force, unemployment—more in line with common experience as estimated by the SGS-Alternate Unemployment Measure—notched lower to 22.2% in March from 22.4% in February.”
John Williams continues:
“The SGS estimate generally is built on top of the official U.6 reporting, and tends to follow its relative monthly movements. Accordingly, the SGS measure will suffer some of the current seasonal-adjustment woes afflicting the base series, such as recent distortions in adjusted reporting of part-time employment for economic reasons. Nonetheless, there continues to be a noticeable divergence in the SGS series versus U.6. The reason for this is that U.6, again, only includes discouraged workers who have been discouraged for less than a year.
As the discouraged-worker status ages, those that go beyond one year, fall off the government counting, and new workers enter “discouraged” status. Accordingly, with the continual rollover, the headline workers flow into the short-term discouraged workers counted in U.6 continue, and from U.6 into long-term discouraged worker status (SGS Measure) at what appears to be an accelerating pace.
An unemployment rate above 22% might raise questions in terms of a comparison with the purported peak unemployment in the Great Depression (1933) of 25%. The SGS level likely is about as bad as the peak unemployment seen in the 1973 to 1975 recession. The Great Depression unemployment rate was estimated well after the fact, with 27% of those employed working on farms. Today, less that 2% work on farms. Accordingly, for purposes of Great Depression comparison, I would look at the estimated peak nonfarm unemployment rate in 1933 of 34% to 35%.
Construction activity remains severely impaired—stagnant near the cycle lows.
Phi Beta Iota: Lies are like sand in the gears of a complex delicate machine. Government lies are the worst of all – a betrayal of the public trust. Of special interest is the fact that the Republican party and the Republican candidates are gong along with these lies — either they do not know any better, disqualifying them from eligibility to govern, or they want to keep the over-all fabric of lies in place to serve the two-party tyranny — disqualifying them from eligibility for governance twice over. There are no candidates running for President who have both the intelligence and the integrity to lead the USA back into stability and prosperity. Buddy Roemer may end up being the Americans Elect candidate, a blend of frauds and certain to be a continuation of the two-party tyranny in another guise. Sickening across the board.