Who to blame for unemployment?

The national unemployment rate rose to 7.9 percent in October. Though 171,000 jobs were added to the economy, there was a 0.1 percentage increase from September. However, the national unemployment rate did not rise because more people became unemployed.

According to the Bureau of Labor Statistics, the civilian labor force participation increased by 578,000 to 155.6 million in October. Essentially, this means more people were encouraged to enter the labor force and since most did not find work, it caused the unemployment rate to rise. The surge in the civilian labor force participation is also indicative to why the employment-population ratio remained the same at 58.7 percent. Since the number of employed people and the number of the working age population changed by the same rate, it shows that the numbers shifted in a positive direction.

Last month, Florida’s unemployment rate fell to 8.7 percent, a 0.1 percentage point decline from the previous month. What makes this different from the national unemployment rate is the number of jobs that were really created and who created those jobs. The private sector created the majority of Florida’s jobs while the state government contributed to unemployment. According to the Florida Department of Economic Opportunity, “These industry job losses were partially due to declines in state government.”

The trend of state and local government cutting jobs is not unfamiliar to the state. DEO reports that “Industries losing jobs over the year included total government. (-11,300 jobs, -1.0 percent)” In Florida, the federal government cut 500 jobs, state government cut 2, 100 and local government cut 100, resulting in a 2,700 government job loss for September. The private sector added 3,500 jobs, but with the 2,700 loss of government jobs, there was only a net gain of 800 jobs in September.

These numbers are somewhat at odds to what the Republican presidential candidate, Mitt Romney, continues to say about job creation.

“The one place we should have cut back was on government jobs. We have 145,000 more government workers under this president. Let’s send them home and put you back to work,” said Romney this summer.

William Guerilus, economics professor at Florida A&M University, said state and local government do not have many options. He said it would be best for the state and local government to receive more aid from the federal government but the federal deficit makes it difficult.

“The second option really is probably to cut employment whenever possible because raising taxes keeps people from working and it can have a negative effect on the economy. Even though we hate it, cutting jobs is the best option they have,” Guerilus said.   However, the national unemployment rate did not rise because more people became unemployed.