Econ Paper - The Economy On The Rise Robert Di Legge...

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The Economy On The Rise Robert Di Legge Kokoszka AQR – 10am Wu “Unemployment Rate Telling a Much More Hopeful Story” The Wall Street Journal Feb. 7, 2014 1
Introduction The article I chose describes the recent drop in the unemployment rate and how the United States may be on an upward rise in the economy as well as lowering our unemployment rate. It discusses how this drop in the unemployment rate is odd due to the fact that 1.3 million workers lost extended unemployment benefits at the beginning of the year. The United States added only 113,000 jobs last month. The unemployment rate dropped to 6.6% in the month of January. They also used a broader measure of the unemployment rate, called U-6 for its data consumption by the Labor Department, which was 12.7% in January. These two rates have both decreased lately, but some of the results are not adding up. A large amount of people received jobs in January. In January of 2014, more than 600,000 more people are employed compared to December of 2013. This may have been because the Labor Department made its annual change in the overall population in the United States, but overall this was a relatively small number. Also, the number of people in the labor force increased significantly to 500,000. This increase caused the labor force participation rate up to 63%, which is still relatively low historically. This is extremely surprising because of the fact 1.3 million workers lost those benefits as the new year came around, as I stated earlier in the paper. In January of 2014, the number of people unemployed dropped 232,000 from the previous six months. Of these 232,000 people, many of them either are employed now or left the labor force. It was tough to determine this due to the fact the Labor Department had a significant increase in the number of people employed. This article concluded by showing how unclear and how the job market will be affected, but in February and March 2
of 2014, the unemployment rate has raised to 6.7% from what it was at 6.6%. We will see what happens in the next few months and this will tell us why the unemployment rate dropped.

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