Infographic: The LFPR Mystery: When a 5.5% Unemployment Rate Isn't Really 5.5%...

One of the most misunderstood numbers in the economy is the Labor Force Participation Rate.  It is the 800 lb. gorilla when it comes to understanding the numbers relating to the American workforce.

The infographic nearby seeks to clarify the picture somewhat, comparing today’s numbers to those if the LFPR was where it was when Barack Obama took office.

Here are some key numbers from the government:

US Adult Population  = 250 Million

(16+ not counting those in the military or imprisoned or institutionalized)

LFPR = 62.9%

(The percentage of the above Adult Population who are in the Labor Force.)

Labor Force – 157 Million

(Those working + those seeking work.)

Employed – 149 Million

(Those currently working.)

Unemployment Rate –  5.5%

(Those not working but seeking work.)

NILF = 93 Million

(Those not in the labor force… not working nor seeking work.)

By comparing today’s LFPR to what it was in February 2009 we can see that the 5.5% unemployment rate is largely an illusion created by a growing number of people becoming discouraged about finding work or who have sufficient benefits from the government that seeking work is no longer a necessity.

And it’s not because of seniors… they are the only demographic who are working at a higher rate today than they were in Feb. 2009.

Here is a link to a large file of the nearby infogpraphic, suitable for printing.