Looking at US unemployment and population at the height of the recession, By Ron Brown, Home Loan Specialist

The weekly numbers for initial jobless claims were released today showing a "better than expected" number of "only" 432,000. The "better than expected" part of this number is because the average estimate by a group of leading economists was for this number to come in at 460,000. Either way, these negative numbers are not good, and worse yet, they don't paint an accurate picture.

The initial claims report is the number of people who claimed unemployment for the first time this past week. In other words, 432,000 people lost their jobs for one reason or another during the week of Christmas. What this number misses is the how many people "came of age" during this week, but have not yet become employed. By this I mean the total number of people in the country who turned 18, and are now considered adults. Not all of these people will be looking for a job right away, but the vast majority will need employment in the near future, even if that is after they graduate from college.

The bottom line is for our economy to maintain a level of employment, and keep up with population growth, whether that be 90%, 95%, or any other number, we must actually Create jobs, not limit the number of job losses. Consider the fact that our country has approximately 325 Million people. If population growth were limited to 1% that would be 3.25 million new citizens each year. 3.25 million divided by 12 months is over 270,000 new mouths to feed every month. The 150,000 new jobs necessary to maintain a stable employment level is rather conservative when compared to this figure. What this means is that the 432,000 lost jobs must be increased by at least 150,000 to give an accurate picture of how our economy is performing - falling behind by 682,000.

There are other components of the unemployment statistics that are meant to provide a better overall picture of our economy's employment, such as the continuing claims number which attempts to keep track of the total number of people unable to find work. This number is similarly understated because we can only track the number of people who are in the initial 26 week unemployment cycle. All those people who could not find work in that 6 month period stop being counted whether they find employment, or not. Worse again is the distortion caused by the recent extension of unemployment benefits. The good news is that folks looking for work, but not able to find it are being subsidized beyond the accepted 26 weeks, but the bad news is that the unemployment figures do not continue to account for them as unemployed. They just "disappear" from the ranks of the unemployed.

I don't mean this article to be as much of a downer as most will think, but rather to raise awareness of just how big the task at hand is. Until we are given more accurate information, it will be near impossible to create a comprehensive plan that has a chance of success.

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