It’s time to change the way we look at economics. And the first step is to look into hiring new economic advisers, ones who can come up with completely new models and new approaches to how we look at our economy.
This is especially true in the employment sector, where we need economists who truly understand the nature of unemployment and unemployment insurance. Right now, there are several different methods of measuring unemployment, and politicians simply pick the number that fits their political narrative. If you look at the data put out by the U.S. Bureau of Labor Statistics the rate is around 15 percent, while the 4 percent popularly quoted by politicians is based on the amount of people who have run out of unemployment insurance.
A complete picture would encompass all of the available factors. That would include the standard U-1 through U-6 designations from the Bureau of Labor Statistics, but also account for factors completely ignored by current computation methods. Look at disability insurance. More and more people are living on disability insurance tied to their regular unemployment insurance, and it needs to be incorporated. Underemployed individuals and part-time workers should also be included, since they, by definition, are not fully employed. These elements alone would have drastic effects on unemployment numbers. At the same time, they would give leaders a more accurate way to address issues and create employment.
Beyond these core employment factors are more complicated pieces of the puzzle. A true unemployment rate would include data about illegal immigrants who aren’t looking to be employed at all, preferring under-the-table arrangements that wouldn’t show up on official records. The high-tech world is also adding new wrinkles every day with non-traditional income opportunities like gig-based or home-rental work.
Developing a true unemployment calculation for the modern world is a stiff goal, but a necessary one. Once it’s created, it’s a simple step to get buy-in with any politician who wants to truly show the difference they’re making. With wider adoption of a true unemployment calculation, any administration will be able to take active measures to improve employment, which, in turn, improves the tax income while helping issues such as race relations, income distribution, and more.