How the jobless rate is measured and compiled
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Do you have a job? Do you get paid for it? Each month, Census workers ask thousands of Americans, including 1,700 Minnesotans, those personal questions. The answers they get deliver vital clues to the nation's economic health.
Economists comb Census data to see if work is available, if employers are hiring more full- or part-time workers and if people are job hunting or giving up on finding work. Survey answers are used to calculate unemployment rates. (Minnesota's June rate was released today.) They shape economic policy and can move markets around the world.
It all starts with some basic questions to people like Emily Parker and Mike Nawrocki of south Minneapolis.
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They were tapped by the Census a few years ago for the Current Population Survey. A field representative spent several months in contact, asking questions about their employment situation. Among them: "Last week, did you do any work for pay or profit?"
"It was funny to have the stereotype of the census taker going door to door with the clipboard alive and well, but also with the computer," Nawrocki said. "I was definitely surprised."
During the months participating in the survey, the couple had steady work -- Nawrocki as a speech pathologist and Parker as an epidemiologist. But people with less-steady work could be still counted as employed in the survey.
Steve Hine, chief labor market analyst for the state Department of Employment and Economic Development, said the Census sets a low bar for considering a person employed.
(Read more of Hine's analysis of how the unemployment rate works)
Someone who merely mows a neighbor's lawn for pay would technically be counted as employed. Nevertheless, Hine says the unemployment rate is still a useful gauge of the economy.
"You're going to get consistent indicators of the direction of change, whether we're seeing deteriorating recessionary movements or whether we're seeing expansionary or improving movements in unemployment," Hine said. Hine says there are a number of other, less frequently reported figures that do a better job of capturing the extent to which the labor market is humming along or dragging.
One reflects not just whether people are working but also whether they are working part-time because they can't find a better job -- or if they've given up their job hunt out of discouragement.
Despite its shortcomings, there are still real people behind the official unemployment number. That's something Parker came to appreciate after she got to participate in the unemployment survey.
"It made me less skeptical because they do repeated measures and follow up with the same people over time, so it's not just random data points," she said. "It's more telling a story."
Minnesota's unemployment rate of 5.3 percent hasn't changed much over the past few months.
So the story the state's number seems to be telling is that the economy in decent shape, but not making huge strides in one direction or another.
