Federal Reserve Chairman Jerome Powell stated yesterday in a speech to the Economics Club of New York that the real unemployment rate in the U.S. is actually around 10%, far higher than the official figure of 6.3 percent reported by the Bureau of Labor Statistics last week. “The Bureau of Labor Statistics reports that many unemployed individuals have been misclassified as employed,” Powell said. “Correcting this misclassification and counting those who have left the labor force since last February as unemployed would boost the unemployment rate to close to 10 percent in January… The pandemic has led to the largest 12-month decline in labor force participation since at least 1948.” The January employment report showed that 5 million people left the workforce that month, principally because they gave up on looking for a job. These people are not counted among the officially unemployed, because they are no longer even looking for work.
Powell’s new discovery – emphasized for years by EIR – in fact continues to understate real unemployment by about half.