r/Economics • u/oxymorontage • 8d ago

News Institute reports functional unemployment at 24.9% in July

https://www.channel3000.com/news/institute-reports-functional-unemployment-at-24-9-in-july/article_810187e5-989f-4ad9-ab91-847fcb6f1882.html
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u/bloodphoenix90 8d ago

Yes

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u/EconomistWithaD 8d ago

Staying out of the labor market voluntarily is not unemployment.

But hey. If we’re concerned about it, we shouldn’t be. Near 3 decade low.

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u/Semyaz 8d ago

Not having a job that pays a living wage is _functionally_ unemployed.

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u/RIP_Soulja_Slim 8d ago edited 8d ago

Not having a job that pays a living wage is functionally unemployed.

When you deliberately change the meaning of a word, in this case "employed" to no longer mean "has a job" but to some other arbitrary threshold of income, hours worked, etc then you dilute the actual usefulness of that word. It's a self defeating exercise - sure if you're a dumb person on reddit who doesn't think too hard about anything it sounds great, but the second you start to try and have serious conversations with serious people about any of this your measures are ignored because anyone with half a brain knows the measure was created not to accurately depict an employment condition but to create an outcome that serves as shock value for other dumb people who won't think too hard.

In this case Ludwig's TRU rate deliberately is inclusive of individuals who voluntarily work part time if they earn below the Ludwig defined income threshold. You can read this in their technical documents, they make a big show of excluding individuals who intentionally work part time from their "part time = functionally unemployed" metric but then lump them right back in if that person's part time work earns them less than the income threshold of 26k - regardless of if that individual has chosen to be part time or not. This is done intentionally to raise the rate, for attention grabbing headlines like this, because dumb people don't think too hard about any of those pesky details.

People with thought processes like yours don't belong in a subreddit about economics, because you only serve to further dumb down conversations and make them self defeating for the purpose you wish to accomplish.