Oregon Public Broadcasting

The Bureau of Labor Statistics announced Friday that the national unemployment rate dropped for the first time in this long recession.

It now stands at 9.4 percent.

Oregon’s rate is 12.2 percent.

But if you look at what some economists call the real unemployment rate, Oregon’s rate is closer to 19 percent

That means that 19 percent of workers here are either part-time and want full-time work; or are so discouraged they haven’t looked for a job in a month.

KristianFoden-Vencil talked to one of those under-employed Oregonians and takes a closer look at the unemployment number.

Steve Lennert lives on a six-acre plot of land in rural Clackamas County. Last year he sold his fabric business in Damascus and bought a $20,000 machine. It stitches beautiful patterns on quilts.

Steve Lennert: “This room in my house. This used to be my master bedroom, which is one of the largest rooms in my house. I needed to move into a smaller room in order to have a room to put this machine in. The machine head on it is basically like a large sewing machine only it’s mounted on a carriage, that moves on wheels. 

Kristian Foden-Vencil: “I see, so you can stitch where you need to stitch, without going along straight lines. You can do all kinds of different patterns.”

Steve Lennert:“Exactly.”

Lennert says for the first half of last year he was doing very well, with quilt orders stretching out months in advance. But as the economy got worse, there were fewer and fewer customers.

Steve Lennert:“Then in the summer it really started tapering off and by the fall Ihadpractically no business at all.”

Kristian Foden-Vencil: “What percentage. Were you down 50 percent?”

Steve Lennert:“Easily. By December, with the weather, I had no business at all. Zero.”

Things have picked up since then. But he’s only doing about 60 percent of the business he started with. That makes Lennert one of the "under-employed." 

The government counts as under-employed people who’d like to work more or aren’t making full use of their skills.

Steve Lennert:“I could easily be doing more work and I’d like to make this business work. I have been out to look for part-time work just to supplement my income, but of course everybody’s looking for that, so I haven’t had much luck.”

The government does not count Lennert among the "unemployed."   That puts him in a statistical gray zone.

For years politicians have tinkered with the way unemployment is estimated.

For example in 1961, under president John F Kennedy, the government stopped including people who’d given up looking for work.

In the 1980’s, Ronald Reagan reclassified military members as "employed," rather than excluding them from the labor force.

And in the 90’s, the Clinton administration cut the proportion of inner city households included in the unemployment survey. That had the effect of improving the poverty and employment statistics for African Americans.

But David Cooke, an economist with the Oregon Employment Department, says the official unemployment figure reported monthly is reliable.

News outlets report on one unemployment figure every month-- the one that put Oregon's unemployment rate at 12.2 percent in June.

But the Bureau of Labor Statistics actually publishes six different figures, including demographics like: discouraged workers, part-time workers and under-utilized workers.

David Cooke:“So you can look at these six different measures and you can say, Okay, let’s say I want to include everybody’s who’s marginally attached to the labor force. Okay you can add those people in, they have data on that, and you can look at the unemployment rate and how they’ve changed. So you can look at these different measures and see what’s going on with the labor market.”

At 12.2 percent, Oregon’s unemployment rate is the third worst in the nation -- behind Rhode Island and Michigan.

State economist, Tom Potiowsky, says that may look bad, but there’s another way to think about it.

Tom Potiowsky:“If you want to be in North Dakota, which has one of the lowest unemployment rates in the country right now, we could have all our businesses leave the state, turn it mostly into farm land and we won’t have any bursts of economic activity, and we won’t have any declines. And it’ll be a rather boring state to live in.”

So, while a high unemployment number isn’t good news he says, it is at least indicative of an active economy.

Back in rural Clackamas County, Steve Lennert sews a pattern on a large quilt.

Steve Lennert:“They have to pick some way to record and present the economy and unemployment and if they’ve been doing it a certain way for many years that’s probably the way they should continue doing it, so they can have some comparison value. But I do have to point out that self-employed people take a great risk in starting businesses these days and I feel like it would be nice to have the government support those people because they are the ones who are creating the jobs and hopefully picking up the economy. And those are the people who suffer the most when the economy is down.”

Oregon’s new unemployment numbers for July are scheduled to be released Monday August 17th.