Small Business Advocate Poll: The truth about unemployment

The Question:
Will you give the President credit for the drop in the unemployment rate to 7.8%?

17% - Yes - It shows his policies are creating new jobs.

81% - No - it doesn’t include those who stopped looking for work.

2% - Undecided.

My Commentary:
Recently, the U3 unemployment rate was reported to have dropped to 7.8%. For the entire time President Obama has been in office, this indicator has been above 8%, which historically does not bode well for the incumbent facing reelection.

We wanted to know how small business owners felt about this new number, so last week we asked this question on our online poll: “Will you give the President credit for the drop in the unemployment rate to 7.8%.” Here’s what you told us.

Seventeen percent said they would indeed give the president credit because “… his policies are creating new jobs.” Those who were undecided came in at 2%. But the big number - 81%, said they would not give the president credit because, “… it doesn’t include those who stopped looking for work.”

U3 is the classic unemployment metric most often referred to, but it is basically a household survey, not a comprehensive standard. In any other context, such a statistic would be considered no more than a rule of thumb. The more comprehensive metric is U6, which includes those who are unemployed and under-employed.

As I have been reporting for at least two years, U6 unemployment is closer to 15%. In human terms, more than 20 million Americans are either unemployed or not employed to their qualifications. Plus this number does not include those who have given up looking for work - or the record number who have recently switched from unemployment to disability.

Regardless of which metric is used, the U.S. has a serious and chronic unemployment problem not seen since the Great Depression. And it will take people who understand how the economy works to help job creators turn this around.

The thing that gives me hope for America’s future is that our poll indicates small business owners are not naïve or uniformed about the truth.

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Click here to listen to more of what I have to say about the politics of unemployment percentages on my radio program, The Small Business Advocate Show.

Check out more great SBA content HERE!

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Take this week’s poll HERE!

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