Unemployment Rate Masks Continued Weakness in the Job Market

Discouraged workers account for about half of recent decline

While recent declines in the unemployment rate are good news, about half of the decrease comes from workers who have given up looking for a job - not a surge in the demand for labor.

"We really want to see unemployment decline because labor demand is up," says Bill Dunkelberg, NFIB's chief economist and host of Your Bottom Line With Bill Dunkelberg.

NFIB's most recent survey of small business owners showed an actual decline in the number of firms looking to add workers. One of the major reasons is the lack of growth in the demand for services.

"That's about 70 percent of the spending consumers do, and unfortunately in the service sector, all of last year spending was up two-tenths of one percent - statistically zero," Dunkelberg says.

NFIB's web series Your Bottom Line With Bill Dunkelberg educates small business owners on what drives the economy and how economic issues affect their businesses. William Dunkelberg, one of the nation's top experts on small business, hosts the series. New videos are posted each week and all episodes are archived for later viewing.

About NFIB
NFIB is the nation’s leading small business association, with offices in Washington, D.C., and all 50 state capitals. Founded in 1943 as a nonprofit, nonpartisan organization, NFIB gives small and independent business owners a voice in shaping the public policy issues that affect their business. NFIB’s powerful network of grassroots activists send their views directly to state and federal lawmakers through a unique member-only ballot, thus playing a critical role in supporting America’s free enterprise system. NFIB’s mission is to promote and protect the right of members to own, operate and grow their businesses. For more information visit NFIB online.

About William Dunkelberg
William C. Dunkelberg has been chief economist for NFIB since 1971. He is currently professor of Economics at the School of Business and Management, Temple University, and served as dean from 1987-94. He was director of the Center for the Advancement and Study of Entrepreneurship from 1991-94.

Dunkelberg is a nationally recognized authority on small business, entrepreneurship, consumer behavior and consumer credit policy. He has been an advisor to cabinet officers, a member of the Consumer Advisory Council of the Federal Reserve System and is a past president of the National Association of Business Economists. He has chaired the Census Advisory Committee and is an elected member of the Conference of Business Economists and the National Economic Issues Council. He is also a frequent contributor to broadcast and cable news programs and is often quoted in leading newspapers and magazines.