June 19, 2018
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‘Official’ state jobless count likely too low

By Mal Leary, Maine Public

AUGUSTA, Maine — A federal Bureau of Labor Statistics survey may provide a more accurate picture of the state’s unemployment situation than the “official” rate released monthly by the Maine Department of Labor.

The state’s figures are based primarily on the numbers of people receiving unemployment insurance, but new data collected by the Bureau of Labor Statistics could broaden the state’s view.

Todd Gabe, an economist at the University of Maine, said the federal survey, which was started in 2007, measures areas such as people who have been unemployed longer than 15 weeks; workers whose temporary jobs are completed; workers who have part-time jobs and cannot find full-time work; and a growing sector — “discouraged” workers, those who have been unemployed for a long time and possibly have given up searching for work because they may be convinced there is nothing available.

“If the economy is going down, you have discouraged people leaving the labor force, so in some respects that understates the number of people out there that are looking for jobs,” Gabe said.

The first full year of the new federal statistics is for 2008, and the state just recently learned the federal government was collecting them. Current unemployment figures the state releases monthly do not include the new information.

“This is pretty new information for us that has been collected by our federal partner,” said Labor Commissioner Laura Fortman. “It is based on samples and the sample size is very small, so while it provides interesting information and can point to trends, we are reluctant to have people think these are absolute numbers.”

Gabe said the federal measures do provide a broader picture of what is happening in the job market. He said all the measures depend on surveys, including the “official” rate that is based on a census estimate of the size of the work force.

“All the measures have usefulness,” he said, “and all have their limitations.”

Ed Gorham, president of the Maine AFL-CIO, has long been critical of the “official” Maine unemployment rate. He said the current definitions leave out a lot of workers because they are not covered by unemployment insurance. He also pointed out that the state number released to the media every month does not measure the “discouraged” workers, which he believes is a growing group.

“They basically drop out of sight and off the radar screen,” he said. “I think there are far more out there than people realize.”

Fortman acknowledged she has long been frustrated by the problem of measuring and identifying “discouraged” workers. She stressed that even though they are no longer tracked by her agency like unemployment recipients, DOL provides job search services to everyone who seeks help.

“And I urge those people to go to a CareerCenter or go online and use the resources we provide for job search,” she said. “We want to help everybody that needs it, not just those receiving unemployment [insurance].”

In 2008, the average “official” unemployment rate for the year was 5.4 percent. That translates to about 36,000 Mainers out of work and seeking employment in any given month. Adding the estimated “discouraged” workers boosts that number to about 44,000 Mainers.

“And then there is the issue of the underemployed,” Gabe said. “Those are people who are working part time but can’t find a full-time job even though they want one.”

The 2008 average estimate of those that were unemployed, discouraged, in temporary jobs or underemployed is 10.9 percent. That translates to about 73,000 Mainers.

“When you look at those numbers of discouraged workers or people that are working part time and want to work full time, it gets to a number that more accurately reflects our instinctive sense of what is going on in the economy,” Fortman said.

Several lawmakers say they were unaware of the more extensive estimates done by the federal agency. Sen. Peter Mills, R-Cornville, is a member of the Legislature’s Labor Committee and said the additional measures will help lawmakers and state officials analyze what is happening in the state’s job market.

“Everybody knows there are exhausted benefits workers,” he said, “but I was not aware they were actually sampling these people to come up with an estimate of how many there are. That is of great interest.”

Fortman said the data are all public and available for anyone, including lawmakers, to review. She said it is not provided with the monthly news release from her agency because her staff questions its reliability from month to month.

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