Chart Of The Day: US Labor Force Declines By 25,000 In Past Year Despite 2.4 Million Rise In Employable Americans

Tyler Durden's picture

A few days ago, one of the winners of the 2013 Nobel prize for economics, Robert Shiller, warned that stocks are in a bubble, voicing what most people, except for conflicted asset managers for whom spinning the truth and increasing their AUM means a greater paycheck, and the monetary misfits in the Marriner Eccles building of course, know: that stocks are in a bubble. Today, it was the turn of the other Nobel prize winner, Eugene Fama, whose expertise in markets may be a tad more questionable (he still believes in efficient markets in a world in which the Fed exists), to warn about something else - the risk of global recession.

Via Reuters:

"There may come a point where the financial markets say none of their debt is credible anymore and they can't finance themselves," he told Reuters in the snow-covered Swedish capital, where he will receive his prize on Tuesday.


"If there is another recession, it is going to be worldwide."


Fama, who has been called the father of modern finance and shared the economics prize for research into market prices and asset bubbles, played down this week's strong U.S. labor market data.


"I am not reassured at all," he said.


The U.S. jobless rate fell to a five-year low of 7.0 percent in November, and employers hired more workers than expected.


"The jobs recovery has been awful. The only reason the unemployment rate is 7 percent, which is high by historical standards in the U.S., is that people gave up looking for jobs," he said.


"I just don't think we have come out of (recession) very well," he said.

But we sure have stayed in the depression quite well. And to illustrate just what Fama means, here is a chart showing the US labor force "change" between November of 2012, when the unemployment rate was 7.8%, and the just released November 2013 numbers, according to which unemployment fell to just 7.0%.

As today's chart of the day shows, while the civilian noninstitutional population (i.e. employable Americans over the age of 16) grew by 2.4 million in the past year (from 244.2 million to 246.6 million), the US labor force somehow, very mysteriously, declined.

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katchum's picture

Doesn't that mean that the unemployment should be going up?

Tyler Durden's picture

It means that if the labor force participation rate was realistic, the US unemployment rate right now would be 11.5% instead of an artificially lower one.

kliguy38's picture

You're all nuts.......the skull n bones boyz have it alll covered............hehehheheeheh.........its all "fixed"

LetThemEatRand's picture

You know the old saying -- the world needs 7 billion ditch diggers, too*

*and a few thousand people with all the money telling the 7 billion where to dig.

Ham-bone's picture

curious how since the CLF peaked @ 155 million in '08 it has completely stalled for five years???  Where'd all those folks go, anyway?[1][id]=CLF16OV&s[1][range]=10yrs

TheMerryPrankster's picture



mars mission - mars has more jobs than peoples. That atmosphere ain't gonna build itself.We need warm bodies, now....

Internet entrepenaurs - can't swing a dead cat without hitting a couple dozen of them. Mostly in mom's basement.

Mom's basement - the rent free dungeons of the middle class, Great place to start a business or surf  porn and play computer games.

Bridge Underpasses, if mom don't have a basement , this is the next best thing. Great close by location for public begging. Cardboard sign and a sharpie and you could be eating at mcdonalds tonight.

Van down by the river, tell everyone your camping to learn how to be self sufficient.

everyone else is panning for gold in the mountains or making crack in their basements

Jack Burton's picture

Rand, It amazes me how you get a red arrow for that obvious bit of truth. There is a certain group, claiming right wing or libertarian status who are so in the camp of the 1% that it is not even funny. Were the 1% of today busy industrious capitalists in a free market economy, I could have more respect for them. But in today's criminal crony capitalist system, the majority are very dubious. Mostly speculators using the world's central banks as sources of free money. They now control governments to enforce lax labor laws, open borders to low wage labor, wars against anyone not in the dollar club, bankers and the like.

How the 1% has brainwashed people is off in itself. Instead of giving your statement a red arrow, I would that they expalin where you are wrong. Give evidence in favor of the 1%. That red arrow is a cowards option. I do not red arrow people very often. I appreciate people have different opinions, why not defend their opinions, tell us why 7 billion should dig ditches for low wages so the 1% can have it all.

starfcker's picture

jack, they are all over this board. little obamanomic bots that spout off ad nauseum what they were taught in school or from their bottom rung perch at one of the douchebanks. their brainwashing is astonishingly thorough. the red arrows are nothing, they disapear when you call them out or ask for an explaination. i think this site is good for them. this may be the only place they hear something different. might get them to think. 

Jack Burton's picture

Indeed! I notice that at times they explode onto this site with great force. Post after post pissing all over working people and low wage people like they are scum. And always crying a river if one 1% 'er gets nicked for a little tax, like on their mansions. Yesterday they were even crying over the imposition of some capital gains taxes on foreign property speculators who buy flip and make a bundle, they believe these folks should be tax exempt, yet they never say shit about the taxes the rest of us pay.

They never stay to defend their postions, it's juts hit hard and run. I really called them out on this a couple days ago, but I've forgotten which post it was on as I have been busy working to keep my very small business alive and going. I do not escape taxes, why should a foreign billionaire get out of capital gains on RE speculation in NY or London?

LetThemEatRand's picture

The irony is that the large, large majority of the Rand crowd are themselves nowhere near the 1%, but they imagine themselves there some day so they tell us all that we need to live in a society of great wealth imbalance on the off chance they may one day get to benefit from it.  I had a conversation about Rand a while back with a guy who 1) lives with his girlfriend who makes far more than him, and who pays for most of his living expenses, and 2) who has absolutely zero chance of ever being wealthy unless he wins the lotto.  Despite the utter hypocrisy of it, he loves Rand and somehow blames the working guy and social programs for his inability to succeed.  On the other side of the spectrum, you have all of the Rand believers who came into wealth from family money or marriage.  Before I started my own business a couple of years ago, I often got in arguments with the wife of my former boss who lives quite well thanks to him.  She bought me Atlas Shrugged for Christmas one year as a fuck you gift.  Her success is that she married a guy 20 years her senior who makes a lot of money.  She would have done okay for herself without him, but she would not have been wealthy.    It's like some sort of pathetic club for losers who are great only in their own minds and who use Rand as cover for their own lack of humanity.

starfcker's picture

kind of funny, you can really get a sense of who people are and what they do, in the comments on this site. the split between business people, people who manage money, etc., and  the .govs and the youngsters is pretty stark. the (outwardly) angry white men might have been sent to the gulag (RIP guys, you are missed) but there is still a lot of common sense out there. the split in the GOP looks like next year is cage match time, only one comes out alive. gives me a lot of optimism that this might turn out ok. in that group, money seems to buy less and less votes. the house controls the money. that could be the gamechanger

kurt's picture

Thanks Jack, I like the approach you've been taking on this.

NoDebt's picture

Which would put us roughly in line with...... Europe.

So the question would be "Is Europen unemployment really worse than the US (with equivalent data fudging) or is the US just better at fudging the data?"


Sudden Debt's picture

Europe has been socialist for decades. We invented data fudging.
In Europe you will rarely see stats and numbers in economic newspapers simply because everybody knows they're crap.

Frostfan1's picture

I saw the same two numbers yesterday at 840 am and realized something in this report wasn't adding up. I started to dig in the breakdown by race but stopped as I had a job to get back to. I think whites were like half a million negative but didn't theorize or speculate as to what that meant.

CrashisOptimistic's picture

Frankly, Tyler, we've somewhat reached the point where every address of the Labor Participation Rate should be accompanied by evidence that the ageing of the population is NOT the cause.

Articles have been done on this and appeared here.  Sprinkle the links about.

Quintus's picture

Not if you conveniently remove millions of jobless people from the official definition of 'Unemployed' by pretending that they don't really want to work.

I am Jobe's picture

How dare you say such a  thing. Are you a Ivy league grad?  If not you cannot make such statements

Tijuana Donkey Show's picture

Or people who work and live in the grey/black market economy. 

Sudden Debt's picture

It's just how you look at it I guess...


If I drive with my car in the city and a person is crossing the street... and I hit him with the car.
If that person dies... it's probably because he doesn't want to live anymore... otherwise he wouldn't have crossed the street right?

I didn't ask him to cross the street.
He knew it was dangerous... and yet... he still did it....

And it's a bit the same with the jobmarket and the people I guess.

CrashisOptimistic's picture

Re recent article of the Waitress Terminator.

Automation is destroying society.  Not helping it.

starfcker's picture

crash, you're not quite as optimistic lately. what's up with that?

brettd's picture

Why so interested in protecting buggy-whip makers?

Time to re-invent.

That is, if Obama will allow it....

CrashisOptimistic's picture

And you don't understand societal funding.

The generic 50 year old woman collects tolls at a bridge.  RFID arrives and collects tolls electronically.  She's out of work.

She's not going to software engineering school to learn to program RFID gizmos.  She's not going to ANY school to learn ANYTHING. 

She's going on benefits.  That the software engineers will pay.  For the rest of her life she'll be on govt benefits.

And the real message here isn't 50 year old or woman.  It's IQ.  Automation is going to eliminate all the jobs of the lower 1/2 of the entire fucking population, who will starve without benefits -- which thus must be funded by the other 1/2.  So that upper 1/2 tries to fund their own lives and also carry the lives of the lower 1/2.

And then?  Then you get articles like The Robot Will See You Now, as automation moves into medicine.  Then you get computers writing software.  In other words, the magic vertical line on the IQ graph starts moving rightward.

It doesn't work with 7 billion people.  You can't put all the lower half out of work.  You can't then put the lower 3/4 out of work.  The upper portion remaining can't carry that burden.

THIS . . . is NOT progress.


HomelessCEO's picture

Yes it is. It could be a utopia. The machines grow all the food, do all the chores, and no one would need to "work." The entire economic system of wages and labor would be revolutionized.


On the other hand, it could turn into a Hunger Games world if the "owners" of the machines do not play along. The few who make the robots and computers function would have to "unionize" to prevent this from happening.


CrashisOptimistic's picture

I don't think you understand.

A mere crash of civilization is optimistic . . . in comparison to what really approaches.

starfcker's picture

crash, i understand exactly what you are saying. i am just not nearly as bothered by automation. the best example i can give you was a conversation i had with a buddy of mine some years ago. his thing was, how many tires do you have touching the ground? everthing, bobcats, trailers, trucks, cars, mowers, wheelbarrows, forklifts, tractors, anything you own that sits on tires. all that stuff may save a lot of labor, but there is enormous costs and time and energy in maintaining all that stuff, and to make his point, just the tires of all that stuff. there is no free lunch to automation. i believe the free lunch is outsourcing, the ability to have the advantage of slave labor. doesn't matter how lean i run, i can't compete with that. other than that i agree with you completely

CrashisOptimistic's picture

yeah that's a valid point.  I try to dodge it because as soon as you introduce cheap into the conversation, ppl want to start waving their hands over their heads about the Fed.

The world is controlled by oil scarcity and automation and it's not ever going to get better.  The Fed's role is to keep that reality concealed.

papaswamp's picture

the unemployment number is a math gimmic.
If I have a workforce of 20 people, and 2 are unemployed, my unemployment rate is 10%. Then let's say one more person becomes unemployed but the 2 previous unemployed stop looking for work and are no longer counted. My workforce drops to 18 with 1 unemployed, my unemployment rate drops to 5%. looks like a vast improvement but in reality the situation has become worse (15% unemployment).
Presently, of the 90 million not in labor force... about 40 million are work age, non disabled.... they are not counted in the unemployment rate.

midtowng's picture

There is something wrong with the labor market, but this number means almost nothing. there are better numbers to display the problems.

TheMerryPrankster's picture

Greenshoots, everywhere I look.


beaker's picture

It looks good if you say it fast.

I am Jobe's picture

Whoo hoo. So what is the future, I think it is already here. 



Why the future doesn't need us.

odatruf's picture

Heads in the sand, Jobe.  We must not ever openly talk about what will happen when most of us have no purpose in making the world go round.

Gene Roddenbery excepted.

TheMerryPrankster's picture

is that you Furtado? Missed you at the meetings. Hope you make it to the christmas party.

odatruf's picture

I'd not be part if any club that would have me. Or go to their meetings. :/

But if you'll save us some nog, I'll see you at the party.

Headbanger's picture

Great!  I've been wanting a Staepford Wife android for years!  But I'll get one with a remote control mainly for the mute button.

Midas's picture

I guess this is as good a spot as any to post a link to Andrea Android:

I don't know if she came with a mute button.

JethroTull's picture

Thanks Midas

I needed some Eye Candy ala Star Trek. Found out that Teri Hatcher appeared in an episode.


Who really cares about the u-rate now?

I am Jobe's picture

Future looking bright and prosperous in Amerika.

Keep the Black Friday Sales , NFL, MLB, NBA, College Bowl- Future is in useless things to show value in Amerika. 


Seasmoke's picture

Well Bernanke doesn't want to go below 7% too fast. So the real figures may come in handy. 

pitz's picture

Its even worse than this because 100,000 or more H-1B's were imported in the past year, particularly in the technology/IT sector/roles of the economy.  In addition to foreigners who use other work visas. 

Pure Evil's picture

And, every year the Tech giants go to congress every year begging them to lift the number of available H1-B visas because some of those visas go to importing foreign models.

So instead, congress creates various other visas which can be used to import foreign workers.

Natives might as well give up and resign themselves to being displaced by a foreign population with no allegiance to the Constitution or the history of the American nation.

brettd's picture

Our education system is world class!

brettd's picture

Our education system is world class!

Element's picture