Friday, September 07, 2012

Unemployment Rate Down Due To Participation Rate Decline

The employment situation report released this morning indicated non-farm payrolls increased by 96,000 versus an estimated increase of 125,000. The unemployment rate declined to 8.1% versus 8.3% in the prior month. The total number of unemployed remained at 12.5 million people so one would not expect the unemployment rate to decline. However, the decline in the rate is due entirely to the fact 368,000 individuals dropped out of the labor force. The participation rate fell to 6.5%, the lowest level since 1981.

From The Blog of HORAN Capital Advisors

The employment to population ratio of 58.3% declined slightly from the July level. This ratio has remained relatively flat since the end of the recession as little job growth has been seen in the economy.

From The Blog of HORAN Capital Advisors

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