On Jan 10, 2012, at 12:52 PM, // ravi wrote:
> My doubt is not so much about where to draw the line but what I catch with that line i.e., is this a significant statistic to gather?
The central point of these monthly employment figures is to measure the state of the labor market - tight or slack, wages rising or flat, which sectors are strong and/or weak, etc. They're not mainly about measuring material welfare or its absence. For that, we've got lots of yearly measures, mainly from the Census Bureau.
But from these numbers we do know that a record-breaking share of the population dropped out of the job market in this recession and are staying out. The unemployment rate has fallen about 1.5 points from its peak, but the employment/population ratio is flat. That's important and/or interesting, isn't it? And we wouldn't know that if everyone without a job was simply classed as "unemployed."
As people detach from the labor force, they cease to be part of the wage-setting process. Their skills erode and employers become less willing to hire them. Having these gradations of detachment help clarify all that.
Doug