Something I've been wondering about...

Well here's something I've been curious about... The unemployment rate. You have to scroll down quite a ways to get to it, so I'll paste some highlights here:
Basically, someone wrote in to MSN Financial to find out about the unemployment rate, because it really only reflects the percentage of people who are actively searching for a job compared with those who have a job. So, if someone gets discouraged and gives up searching for a job, they're no longer counted in the unemployment statistics. MSN answers:

The “discouraged worker effect” you describe is well known to economists, and tends to track the strength of the overall economy. When times are bad, more people give up; when the economy gets humming, more people start checking the want ads again and pounding the pavement. Such cyclical changes in what’s called the “labor force participation rate” are not unusual, according to Wayne Ayers, chief economist at FleetBoston Financial.

“But it is clearly more pronounced this time around,” he writes in a recent online newsletter on the subject. “Unlike the pattern of the early 1990s, the participation rate has continued to fall fully two years after the recession’s official end, a reflection of falling growth in wages, rising duration of joblessness and increased outsourcing of jobs abroad.”

As you correctly point out, the question of just who is in the “work force” often can be pretty arbitrary. .... [ie college students, people who aren't working because they don't have to, etc... - my own note] ...

You also make a convincing argument that this number – which was more clearly defined when manufacturing played a bigger role in the U.S. economy – doesn’t do a very good job tracking an increasingly diverse workforce, many of whom are self-employed in new ways that the old formulas don’t measure very well.

That’s why most economists and Wall Street analysts ignore the unemployment rate and look at the second, somewhat more reliable monthly “payroll” survey to get some idea of whether the economy is creating or losing jobs.

Based on that survey, the Bush administration has a lousy track record. Though major tax cuts have stoked the fire and re-ignited the economy, more jobs were lost on his watch than under any president since Herbert Hoover. What’s most worrisome is that while most economic indicators are flashing green – showing a solid, growing economy – the payroll number has been stuck in neutral. So keep an eye on that monthly payroll number; it will have a much bigger impact on the presidential race than the unemployment rate.

So, while the unemployment rate may be going down, it doesn't mean a whole lot. Don't be fooled into thinking that things are looking up when they're not as positive as they "appear." And good luck if you're looking for a job because it's not a lot of fun.