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It's the same fight | 94 comments (94 topical, 0 editorial, 0 hidden)
Are you even reading what I write? (4.00 / 2)
It's all on the definitions

Unemployment rate = unemployed to active ratio

Unemployed to total population is a different number.

Consider 2 different countries

In one, out of 100 youth:

  • 60 study
  • 30 work
  • 10 are unemployed

In the second, out of 100 youth:
  • 30 study
  • 60 work
  • 10 are unemployed

It's not easy with that information to know what's "better". Study or work? For young people, either could be a good thing.

But in the first one, the unemployment rate is 25% (10 / 10+30), and in the second, it's 14% (10 / 10+60)

In both cases, 10% of the youth are unemployed.

Using the 25% rate of the first country to say that 25% of the youth in that country are unemployed is just sloppy or dishonest.

In the long run, we're all dead. John Maynard Keynes

by Jerome a Paris (etg@eurotrib.com) on Mon Mar 20th, 2006 at 01:11:13 AM EST
[ Parent ]
Re: Are you even reading what I write? (none / 0)
This comparison of the unemployment rates is very confusing to me--the different definitions.  I recall that we discussed this here on ET in some detail last October-ish, but I don't recall this difference in the way of handling students.  And I'm a little confused as to why people don't adjust for this in comparison,,,,particularly when comparing youth unemployment.  It seems to me that the US approach to this is logical--basically if you're looking for work and don't have a job, you are counted as unemployed.  So students are not looking for work, therefore are not unemployed--not sure how summer and part-time jobs figure into this.  But the method of counting full time students as unemployed seems very illogical to me.

But a further point of confusion for me: the latest OECD numbers, which claim to compare unemployment on a comprible basis, show the US at 4.7% and France at 9.2%.  But Jerome, if you are saying the "adjusted, or correctly stated" youth unemployment in France is 8%, you are saying that youth unemployment is less than unemployment for the rest of the country.  Just at an intuitive level, that doesn't seem right to me.  Am I interpretting this correctly, and if so, does that conclusion sound accurate to you?  If youth unemployment in France is only 8%,,why do we hear complaints from the youth in France.  I know that 0--5% would be better, but youth change jobs a lot, and float between jobs, and just are less stable than the rest of the work force, in an employment sense.  I'll try to look up the US number that is comprible, but I'll bet it's 8% or higher.

Maybe I can pull together some numbers to make this point better, but hopefully you, or others, can understand my confusion, and perhaps clear it up.

by wchurchill on Mon Mar 20th, 2006 at 01:58:10 AM EST
[ Parent ]
Re: Are you even reading what I write? (none / 0)
A lower youth unemployment rate isn't entirely unlikely - it might simply reflect that they're more likely to take up low-paid jobs or it might reflect that the children of immigrants find it easier to take up employment than their parents or it might reflect that young people are less likely to get caught up in long-term unemployment after losing a job at an older age. All sorts of possibilities: it's not daft on the face of it.
by Colman (colman at eurotrib.com) on Mon Mar 20th, 2006 at 04:17:52 AM EST
[ Parent ]
Re: Are you even reading what I write? (none / 0)
I don't think it is daft,,,it just is very unusual and conflicts with the data one would normally see for youth unemployment.  For example, check out the chart Migura references below, by Alexandra.  It shows the more normal pattern of twenties unemployment versus older age groups.
by wchurchill on Mon Mar 20th, 2006 at 11:31:49 AM EST
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Re: Are you even reading what I write? (none / 0)
But the method of counting full time students as unemployed seems very illogical to me.
Full-time students are counted as inactive (i.e., outside the labour market), not as unemployed. The unemployment rate is usually taken as a fraction of the active (having/seeking employment) population, not of the total population. The problem with youth labour statistics is that between, say, age 14 and age 30, a substantial fraction of the population is in education.

Check out the very nice chart put together by Alexandra here.

A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman

by Carrie (migeru at eurotrib dot com) on Mon Mar 20th, 2006 at 04:37:03 AM EST
[ Parent ]
Re: Are you even reading what I write? (none / 0)
thanks for that clarification, Migeru.  Alexandra's chart makes a lot of sense.  I think this one posted by Jerome confused me a little, coupled with a comment that Jerome made somewhere that said youth unemployment is only 8% in France (perhaps I don't remember that comment correctly).  

It's one thing when you see all these numbers in one diary, and can reconcile the differences between them.  But when they come out over the course of weeks or months, and one relies on memory, and can't reconcile,,,,it's just confusing.

I guess I'm still confused with my memory of Jerome's comment, which I think was youth unemployment in France is only 8%, about the same as the UK.  (I'm not asking you to reconcile,,,,I should take the time and dig back through the data myself).  but thanks for your reference.

by wchurchill on Mon Mar 20th, 2006 at 12:06:35 PM EST
[ Parent ]
Re: Are you even reading what I write? (none / 1)
The above sounds as if you still don't get it. Jérôme's claim is that unemployed youth are only 8% in France, about the same as the UK, as a percentage of the whole age group.

*Lunatic*, n.
One whose delusions are out of fashion.
by DoDo on Mon Mar 20th, 2006 at 12:29:44 PM EST
[ Parent ]
Re: Are you even reading what I write? (none / 0)
It's because Jerome's chart is the unemployment rate of active youth (again, students are excluded from the calculation).

A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman
by Carrie (migeru at eurotrib dot com) on Mon Mar 20th, 2006 at 12:33:05 PM EST
[ Parent ]
Re: Are you even reading what I write? (none / 1)
wchurchill lets see if I can help clarify using the US numbers I posted below:

In 2005 in the USA the total civilian noninstitutional population ages 16-24 was 36,674,000. It's the total of all youth in the labor force 22,291,000 (Employed 19,770,000 + Unemployed and looking for work 2,521,000) + those Not in labor force 14,383,000 (most of whom are in school or, in the case of the older ones, doing unpaid work like caring for their children).

When you talk of employment and unemployment there are two ways of looking at the numbers:
1) As a percentage of all youth age 16-24
employed = (19,770,000 / 36,674,000)*100 = 53.9%
unemployment = (2,521,000 / 36,674,000)*100 = 6.9%
2) As a percentage of youth in the labor force (those that are employed and those unemployed and looking for work)
employed = (19,770,000 / 22,291,000)*100 = 88.7%
unemployment = (2,521,000 / 22,291,000)*100 = 11.3%

When you see the 88.7% employed number it makes it a little easier to understand that we're only talking about a portion of youth not all youth whereas the 11.3% unemployed can more easily be confused.

In labor economics the two numbers that are usually used  to talk about unemployment are the labor force participation rate (the percentage of all youth who are in the labor force - in the example above (22,291,000 / 36,674,000)*100=60.8%) and the unemployment rate as a percentage of the labor force (11.3% in my example). The first number tells you how much or little the second number tell you about the population as a whole. If you don't have both of these numbers then I would argue it's best to look at unemployment as a percentage of total population.

These numbers come from the US Dept of Labor 2005 annual statistics

I hope this helps...

by Alexandra in WMass (alexandra_wmass[a|t]yahoo[d|o|t]fr) on Mon Mar 20th, 2006 at 04:07:02 PM EST
[ Parent ]
Re: Are you even reading what I write? (4.00 / 2)
My sense is that the youth labor market in France and in the US is structured a bit differently. Between paying for college and/or for a car, which you can have at age 16 in the US whereas in France you can only get your license at 18, and many other reasons I think US youth are more likely to work part time and go to school then French youth who are in school and it seems more French youth are in school and not working then US youth. There also just seem to be more full time employees in France in the types of  waiters/waitress jobs you see students take in the US.

Jerome posted this previously. Left is the employment rate, right is the unemployed population, both as a fraction of the total number of 15-24s.

I just calculated the equivalent numbers for the US based on the US Dept of Labor 2005 annual statistics
US Youth 16-24 in 2005:
employed as % of total noninstitutional population 53.9%
unemployed as % of total population 6.9%
unemployed as percent of labor force (individuals looking for work or employed) 11.3%

Total civilian noninstitutional population 36,674,000
In labor force (looking for work of employed) 22,291,000
Not in labor force 14,383,000
Employed 19,770,000
Unemployed 2,521,000

Note: The population total does not include individuals who are institutionalized or in the military but I ran the numbers with an estimate for the total population in 2005 and even though it seems there were about 4,066,000 individuals in institutions or military in 2005 the percentage remain pretty much the same. For more data from US DOL a good resource is here.

There is also a 2005 report on youth summer employment that gives a feel for the particularities of the youth labor market.


The youth labor force--16- to 24-year-olds working or actively looking for work--grows sharply between April and July each year. During these months, large numbers of high school and college students take or search for summer jobs, and many graduates enter the labor market to look for or to begin permanent employment. This summer, the youth labor force grew by 3.0 million to a total of 24.4 million in July.

The July labor force participation rate for youth (the proportion of their population working or looking for work) was 66.6 percent in 2005.

There were 21.7 million 16- to 24-year-olds employed in July 2005, an increase of 302,000 from July 2004. The employment-population ratio for youth--the proportion of the 16- to 24-year-old civilian noninstitutional population that was employed--was 59.3 percent in July 2005.

In July 2005, 2.7 million youth were unemployed; this was a decrease of 330,000 from a year earlier. The youth unemployment rate, 11.0 percent, was down from 12.3 percent in July 2004.


by Alexandra in WMass (alexandra_wmass[a|t]yahoo[d|o|t]fr) on Mon Mar 20th, 2006 at 02:04:02 PM EST
[ Parent ]
Re: Are you even reading what I write? (none / 1)
Jerome posted this previously. Left is the employment rate, right is the unemployed population, both as a fraction of the total number of 15-24s.
Thank you Alexandra.  Very helpful to me, and also the compribles for the US.
by wchurchill on Mon Mar 20th, 2006 at 04:00:49 PM EST
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Re: Are you even reading what I write? (none / 0)
Glad it helped!
by Alexandra in WMass (alexandra_wmass[a|t]yahoo[d|o|t]fr) on Mon Mar 20th, 2006 at 09:27:04 PM EST
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Re: Are you even reading what I write? (none / 0)
That's why I sopke of deconstructing figures when Jerome posted that diary. A percentage is a ratio of two numbers, so it is worth checking out the basis on which the underlying figures were set.
I too, was a bit confused by the figures in Jerome's diary and interestingly, that's how memory works, recollect only the figure I was confused about, the 8%. Jerome provided very helpful clarifications on that, in the same diary.

When through hell, just keep going. W. Churchill
by Agnes a Paris on Mon Mar 20th, 2006 at 02:57:17 PM EST
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It's the same fight | 94 comments (94 topical, 0 editorial, 0 hidden)
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