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Sunday, December 9, 2012

Drivers of the unemployment rate drop


In May 2007, near the end of the past economic expansion, the unemployment rate last reached its low of 4.4%.  In the 12 months preceding May 2007, the segment population of those not in the labor force had a high average monthly change of 121k.  From May 2007, to the unemployment rate peak of 10.0% in October 2009, the average monthly change of those not in the labor force rose to 135k.  And since October 2009, this average monthly change continues to blossom to 166k.

Do these changes of those not in the labor force emulate the changes in the population during this time?  In the 12 months preceding May 2007, the civilian noninstitutional population over age 16 had an average monthly change of 254k.  And from May 2007, to October 2009, this average monthly change in the population fell to 175k.  But since October 2009, this average monthly change rebounded to 206k.

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