Friday, February 3, 2006
Good News (but you wouldn't know it)
I realized when speaking to a housemate last night about the economy just how divorced public perception is from reality. To me, this is the most insidious form of media bias: the public still thinks the economy is bad after three years of strong growth. More good news: the unemployment rate dropped to 4.7%, the lowest since July 2001. And factory orders have risen 8.1 and 9.7 percent in the past two years, respectively. Even if you read the AP article containing this data, you come away feeling iffy about the economy. Maybe that's good: the frothy optimism of the 1990's is not a good model. But the reality is that productivity, wages, and employment have all been rising strongly the past couple years - but most people have no idea.
Subscribe to:
Post Comments (Atom)
3 comments:
And, yet the economists believe that people are rational to the extent that they solve problems in their heads which economists take days to solve even with the aid of latest generation computers!
Unemployment has been really misleading over the past few years because so many people have just stopped searching for work, more so than in previous periods when unemployment was stable or declining.
Still, you do have a point.
I believe job market participation has been climbing for the last few years, after dropping in the end of the 1990's. That's always a sketchy thing to measure, because it's not like everybody who works needs to work (i.e. they may have savings or a spouse to live off), so it's hard to judge whether it's a "bad" thing that they leave the job market in the same way that it's a "bad" thing when somebody can't find a job who wants one.
Post a Comment