The Real Reason Why Unemployment is 9.0%

(Zero Hedge) At 64.2%, the labor force participation rate (as a percentage of the total civilian noninstitutional population) is now at a fresh 26 year low, the lowest since March 1984, and is the only reason why the unemployment rate dropped to 9% (labor force declined from 153,690 to 153,186). Those not in the Labor Force has increased from 83.9 million to 86.2 million, or 2.2 million in one year! As for the numerator in the fraction, the number of unemployed, it has plunged from 15 million to 13.9 million in two months! The only reason for this is due to the increasing disenchantment of those who completely fall off the BLS rolls and no longer even try to look for a job. Lastly, we won't even show what the labor force is as a percentage of total population. It is a vertical plunge.

The Godfather of the Tea Party Movement Lashes Against Unemployment Report

The godfather of the Tea Party Movement Rick Santelli couldn't contain himself with the rhetoric that the unemployment numbers dropped to the lowest figure not seen in years. The figures are again manipulated since the unemployment rate does not account those who quit looking for work. It is commonsence that unemployment can't drop that dramatically when 36,000 jobs were created last month. That is an impossible feat.

(Media Research Center) Jobs are heading up and down at the same time. The Bureau of Labor Statistics announced the morning of Feb. 4 that only 36,000 jobs were added in the month of January, but the unemployment rate dropped from 9.4 percent to 9.0 percent.

The mainstream news media will likely latch on to the dropping unemployment rate, despite job gains that were less than one-fourth of the consensus estimate of 148,000 jobs added. One of the CNBC panelists noted that the increase was "way below consensus."

CNBC's Rick Santelli even lashed out at some of the CNBC "Squawk Box" panel that were discussing the latest jobs report.

CNBC's Steve Liesman interjected: "It went down, Rick. It went down - "

Santelli continued to criticize the spin: "You know what Steve? You and I both know that the unemployment rate, the labor force moving in and out, those giving up, is really probably your best statistical reason for the drop to 9.0 (percent). And in terms of jobs, you, Mr. Steve Liesman, said if you work just one day. If you stay home but you get paid you're counted in the data …"

But the fact that the two different economic surveys conducted by the BLS were moving in different directions was baffling to many. Even the liberal Economic Policy Institute noted on its blog that the picture was "muddled."