Tuesday, June 7, 2011

Mileading sensationalism about current unemployment vs. Great Depression

- by New Deal democrat

Yesterday CBS news published an article with the sensationalist headline: "Chronic unemployment worse than Great Depression" that has been getting prominent play in all of the usual places.

It's a classic case of there being three types of lies: Lies, Damned Lies, and Statistics.

The subtitle to the CBS articles is
The unemployed have, on average, remained unemployed longer than in the 1930s
and the text of the article gives the actual data:

About 6.2 million Americans, 45.1 percent of all unemployed workers in this country, have been jobless for more than six months - a higher percentage than during the Great Depression.
In other words, it's statistic isn't the number of people who are long term unemployed, it's the percentage.

Fortunately, a commenter named rerutled has already done the heavy lifting for me:

Wait a second here: what the article says is that 45% of the unemployed (themselves, 9%) are long-term unemployed; and that the 45% is higher than during the great Depression.

Unless the 9% unemployed is also greater than during the Great Depression, that's not a "this is worse than the Great Depression" equivalence. What's really relevant is the % of the total workforce that is long-term unemployed.

I mean: what if the unemployment rate were 3%, but 100% of that were long-term unemployed? According to that article, we should say "this is worse than the Great Depression", which, of course, is nonsense.

Watch it, when someone quotes percentages of percentages to you.

Suppose you were in a hospital, bleeding from a severed artery. The doctors and nurses staunch most of the bleeding, but you are still losing a little blood.

Compare that with a situation where the bleeding hasn't been staunched at all, and you are continuing to hemorrhage unabatedly.

In the first case, most of your blood loss is "chronic" - it's old, but the blood is still lost. In the second case, it isn't, because the "old" blood loss is less of the current total.

Which situation would you rather be in?

The current unemployment situation is bad, but the discourse is not helped in the slightest by misleading headlines with statistics contorted so that the phrase "worse than the Great Depression" can be used.