What's the Real Unemployment Rate? That's the Wrong Question!
...The unemployment rate is nothing but guesswork hocus-pocus. The current system has the Bureau of Labor Statistics (BLS) and other agencies guessing how many people in the workforce are "discouraged" and should be deleted from the workforce count.
Then they guess how many new businesses started up and how many closed (the birth/death model) and how many people might have been hired/let go as a result of the birth/death model guesswork.
They derive data by collecting self-reported statistics--the most unreliable source of data possible, as people will adjust their answers to avoid reporting whatever looks bad and exaggerating what looks good. Even if they are scrupulous, does collecting time sheets really provide insight into the economy, employment, and labor force utilization?
Why are we defending hocus-pocus guesswork, when the IRS has hard data on employment, wages, income and the small businesses that are paying estimated taxes for their employees and owners? This data is extracted confidentially-- the taxpayers' identities remain private.
...Asking "how many people have some earned income?" to calculate the unemployment rate is the wrong question. What we should be asking is, how many workers consistently earn sufficient income to support an independent household, i.e. they have "breadwinner" jobs.
Claiming that an earned income of a few thousand dollars a year is functionally equivalent to a fulltime job with paid benefits makes no sense. Lumping every "job" (i.e. earned income) into one category tells us essentially nothing of value about the economy or the labor market.
The IRS data allows us to break out earned income and see how many workers earn sufficient income to support an independent household, i.e. they have "breadwinner" jobs. If we're interested in expanding broad-based prosperity, this is the number that matters.
There is no policy need for guesswork numbers issued monthly when an accurate account of wages, salaries, unearned income and employment is available quarterly.
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