Daily news reports show various unemployment rates and the riser of those rates across the country. These unemployment rates are generally remaining steady while job rate increase. This has caused great confusion for the United States population as a whole. One of the main questions is how job rates can increase the unemployment remained steady. This question also bleeds into a related question of how the reports of unemployment applications are decreasing yet the unemployment levels remain at a steady pace. In other words, how can we have so many unemployed yet jobs are increasing and unemployment applications are decreasing. There are various reasons for this. The following are a few of the reasons that will explain this trend.
Unemployment Criteria and Time Constraints
In order to understand how unemployment rates may remain steady but job rates increase and the unemployment assistance decreases, you must first understand the unemployment criteria and time constraints. Unemployment applications for unemployment assistance will generally require an individual to apply and then only reapply for assistance if they have not found a job in six months. Current unemployment assistance can last upwards of two years or more depending on the length of employment an individual had their previous job. This means that if an individual goes in and apply for unemployment for the first time they are considered part of the unemployment application percentage. However, if they are not applying again they will not be considered part of that application percentage. This means that if unemployment application rates are lowering it can be due to the fact that there are already individuals who are making of the vast majority of unemployment you are just simply reapplying or have not met their six-month mark yet.
For someone to declare unemployment they will need to apply for unemployment assistance or unemployment benefits. When a study is done or some form of research is done to show on the polls for daily news broadcasts or even weekly news broadcast, the unemployment rate is depicted based on the amount of individuals or percentage of individuals applying for unemployment for the first time. Therefore, if 20 people declare unemployment for the first time during week 1, they are considered part of the research percentage. However, if those 20 people do not declare unemployment again and are simply remaining on the unemployment assistance they have been given or are awaiting their first unemployment check they will not be considered in the second round of percentages. For that reason, unemployment rates will stay at a steady pace because of the constant filtering in and out of individuals declaring unemployment or obtaining unemployment assistance.
Creation of Jobs
The creation of jobs in the unemployment report can be misleading. For example, businesses may create hundreds of jobs in a week however that does not mean an individual is eligible for those jobs. Therefore, in any type of percentage study the creation of jobs may show a 25% increase due to thousands of jobs being created by new businesses or old businesses. If individuals on unemployment assistance are not eligible for those jobs the unemployment rate will remain the same and the unemployment rate remained the same for assistance related percentages due to the fact that individuals have already applied for unemployment and are not reapplying every week but are simply remaining on unemployment assistance for at least six months.
The easiest and most basic answer in regards to why job rate increase while unemployment remains steady is due in large to the fact that it's the research uses several aspects that do not coincide together to give a misleading outcome. To give a true picture of unemployment in the United States you would need to look at how many individuals are on unemployment, have remained on unemployment and how many are eligible for the jobs being created. If jobs are being created for individuals who are not eligible then the unemployment lines will stay the same, unemployment assistance will stay the same and is the jobs will remain creative and unfilled.