Gallup’s CEO Calls the Official U.S. Unemployment Rate a “Big Lie”

American consumersI’ve blogged before about how the American public doesn’t seem to be responding to the news that the country has been out of its economic recession for a number of years now.

It’s not for lack of trying.  From the White House and other politicians to government agencies, financial industry practitioners and news media articles, there’s been a steady stream of speeches, announcements, news items and commentary lamenting the disconnect between the perception and the reality.

Plus … I’m reminded often by my business counterparts who work in Europe and Asia that the situation is much better in America than in many other countries.  I consider it advice to “count our blessings,” as it were.

With this as backdrop, it’s easy to fall into the paradigm of thinking that the American public is simply being unrealistic in its expectations for economic recovery — and the recovery’s ability to reach into all strata of society.

But then … along comes a commentary by Jim Clifton, chairman and CEO of the Gallup polling organization.

Jim Clifton Gallup CEO
Jim Clifton

In addition to heading what is arguably America’s most famous polling company, Mr. Clifton is a keen observer of economics and public policy.  He is also the author of the book The Coming Jobs War (published in 2011).

The gist of Clifton’s commentary is that the official unemployment rate, as reported by the U.S. Department of Labor, is very misleading.

Moreover, it’s Clifton’s contention that the very way the Department of Labor calculates the unemployment rate goes straight to the heart of the disconnect between the experts and the “person on the street.”

Here’s what Clifton wrote in a column released earlier this month:

“If a family member or anyone is unemployed and has subsequently given up on finding a job — if you are so hopelessly out of work that you’ve stopped looking [for work] over the past four weeks — the Department of Labor doesn’t count you as unemployed. 

That’s right:  While you are as unemployed as one could possibly be, and tragically may never find work again, you are not counted in the [unemployment] figure we see relentlessly in the news — currently 5.6%.”  

official U.S. unemployment rate
The official U.S. unemployment rate as reported by the United States Department of Labor’s Bureau of Labor Statistics.

In Clifton’s estimation, right now as many as 30 million Americas are either out of work or severely unemployed.  That would equate to an unemployment rate far higher than the reputed 5.6% figure.

But it goes even beyond that.  Clifton points out another clue as to why the perception gulf between the “statisticians” and the “street” seems so wide — and he puts it in the form of two examples:

“Say you’re an out-of-work engineer or healthcare worker or construction worker or retail manager.  If you perform a minimum of one hour of work in a week and are paid at least $20 — maybe someone pays you to mow their lawn — you’re not officially counted as unemployed in the much-reported 5.6% [figure]  

Few Americans know this. 

Yet another figure of importance that doesn’t get much press:  those working part time but wanting full-time work.  If you have a degree in chemistry or math and are working 10 hours part time because it is all you can find — in other words, you are severely unemployed — the government doesn’t count you in the 5.6%.   

Few Americans know this.”

Clifton doesn’t mince words in his characterization of the official unemployment rate; he calls it a “Big Lie” — one which has consequences that go well-beyond simply the stats being arguably wrong.

Here’s how he puts it:

“… It’s a lie that has consequences because the Great American Dream is to have a good job — and in recent years, America has failed to deliver that dream more than it has in any other time in recent memory.   

A good job is an individual’s primary identity — their very self-worth, their dignity.  It establishes the relationship they have with their friends, community and country.  When we fail to deliver a good job that fits a citizen’s talents, training and experience, we are failing the American Dream.”

Statisticians and economic policy experts can and do disagree about what constitutes a “good job” in America.  The Gallup organization defines it as working 30 or more hours per week for an organization that provides a regular paycheck, with or without other benefits.

That’s actually a pretty low-bar for what defines a “good job.”  But however jobs are defined, the U.S. economy is currently delivering at a rate of just 44%, which equates to the number of full-time jobs as a percent of the adult population (age 18 and over).

It would seem that the 44% figure would need to be significantly higher to really solve the challenge of available jobs.

Clifton concludes his commentary by issuing this challenge:

“I hear all the time that ‘unemployment is greatly reduced, but the people aren’t feeling it.’  When the media, talking heads, the White House and Wall Street start reporting the truth — the percent of Americans in good jobs; jobs that are full time and real — then we will quit wondering why Americans aren’t ‘feeling’ something that doesn’t remotely reflect the reality in their lives. 

And we will quit wondering what hollowed out the middle class.”

I’ve devoted significant space in this blog post to quoting Jim Clifton’s words verbatim, so as not to change their tenor or dilute them in any way.

What do you think?  Is Clifton speaking truth to power?  Or is he painting an overly negative view of things?  I welcome your thoughts and comments.

Consumers complain about marketing-oriented e-mails — yet they still read them.

e-mail ambivalenceFace it, there are always going to be complaints about marketing-oriented e-mails. Just as in the “bad-old-days” of junk postal mail, consumers are conditioned to pass negative judgment on the volume of promotional-oriented e-mails that flood their inboxes.

True to form, according to a new study by global business, technology and marketing advisory firm Forrester Research, consumer attitudes about e-mail marketing are pretty negative.

Here’s what a sampling of U.S. respondents age 18 or older reported on the “minus” side of the ledger:

  • I delete most e-mail advertising without reading it: ~42% of respondents reported
  • I receive too many e-mail offers and promotions: ~39%
  • There’s nothing of interest: ~38%
  • I have unsubscribe from unsolicited lists: ~37%
  • I wonder how companies get my e-mail address: ~29%
  • It’s difficult to unsubscribe from e-lists: ~24%

There’s far less to show on the “plus” side:

  • It’s a great way to discover new products and promotions: ~24% of respondents reported
  • I read e-mails “just in case”: ~19%
  • I forward marketing e-mails to friends sometimes: ~12%
  • I purchase items advertised through e-mail: ~7%

I wasn’t surprised at all by these finds.

What’s interesting, however, is that the attitudes of consumers are actually trending a bit better than they were in previous Forrester field studies.

Specifically, respondents exhibited improved attitudes in the following areas:

  • Fewer respondents are deleting most marketing-oriented e-mail promos without reading them (~42% vs. ~44% in 2012 and ~59% in 2010).
  • Fewer respondents report that marketing e-mails offer “nothing of interest” (~38% vs. ~41% in 2012).

The percentages are also slightly better for the consumers today who consider e-mails as a good way to discover new products and promotions.  Additionally, the percentages are lower on complaints about receiving too many e-mail offers.

The bottom line on these results:  It looks as if consumers have come to terms with the pluses and minuses of e-mail marketing. As they once did with postal mail, they recognize the negative attributes as a fact of life — something that just “comes with the territory” for anyone who is online.

Click here to view summary highlights from the Forrester study, or here to purchase the full report.