The numbers—from Bureau of Labor Statistics
The unemployment rate in the U.S. unexpectedly fell to 7.8% (12 million people) in September.
—involuntary part-time workers rose from 8.0 (Aug) to 8.6 million (Sept): 600,000 more people who couldn’t find full-time work; lost their full-time work and took part-time work; or got their hours reduced not by their choice.
—total non-farm payroll employment rose by 114,000: 104,000 from private sectors and 10,000 from governments
—the underemployment rate (part-time workers but wanting a full-time position and people who want to work but have given up looking and therefore are not counted as unemployed): 14.7%
—number of people not in the labor force (and not counted in the government unemployment rate because they’ve given up searching for jobs): more than 6.7 million. If you add these people to the counted unemployed, the true unemployment rate is 11.6% (18.8 million)
After 43 straight months with unemployment rate above 8%, a drop to 7.8% is long awaited news for millions of Americans. However, if there were 114,000 jobs added while 600,000 more people taking part-time positions against their choice, simple arithmetic would lead one to believe there was a net loss of about 486,000 full-time positions—assuming 114,000 are all full-time positions.
600,000 more people taking part-time positions may mean:
—600,000 house-holds that may need government assistance like food-stamps, may face foreclosure on their homes, etc.
—600,000 young adults who may need to move back in with their parents
The underemployment rate held steady at 14.7%.
The true unemployment rate is still at a high level of 11.6%—i.e. 18.8 million who wanted to work but could not find work.
Is there light at the end of tunnel?
Do you believe finally there is light at the end of the tunnel?
Obama-Biden would like you to believe so.
Let us just suppose the long overdue recovery is finally coming.
Let us just suppose that 18.8 million unemployed finally see light at the end of the tunnel—however small or dim that may be.
One must wonder what the effects of Obama’s tax plan on the rich will cause to this “recovery”.
Obama’s tax plan on the rich—jobs killer
The reason why Obama’s tax plan would not affect a majority of the 20 million small businesses (as defined by IRS) is because more than 90% of these small businesses don’t earn more than his $250,000 threshold—but most of these are solo entrepreneurs with no employees anyway.
The rest of the 20 million small businesses would face a tax rate as high as 39.6%. These businesses employ about 60 million people—half of the private sector employees.
Obama’s high tax bill would prevent business growth and hence jobs growth. A study by The Ernst and Young estimated that 710,000 jobs will be lost if Obama’s tax plan is implemented.
Obama’s high tax bill would only bring in addition of $89 billion a year in federal income tax revenue—a drop in his annual trillion dollar deficit.
Obama’s tax plan will surely put out that light at the end of the tunnel—if it’s really there now—for the 18.8 million unemployed.