3. Workers are really discouraged.
As the below graph shows, the number of discouraged workers – jobless people who want work but have given up looking – has shrunk considerably since the worst days of the jobs crisis. However, last month that number of people ticked upward by nearly 250,000.
As with part-time workers, that could be a statistical anomaly. But O'Keefe provides another explanation: the expiration of long-term jobless benefits. Federal jobless benefits are petering out for many long-term unemployed workers and budget problems have hastened that end for the residents of some states. North Carolina chose to end its long-term benefits program and sequestration caused some states to shorten the length of the program.
To continue receiving those benefits, a worker has to be actively searching for a job. But once the benefits run out, a worker may call the job search quits, meaning they would move from the ranks of the unemployed to the population of discouraged workers.
"If an individual is receiving benefits, whoever is responding [to the jobs survey] for the household wants to make sure that they're not going to jeopardize those benefits, they automatically say yes," the person is seeking a job, says O'Keefe. "Once the incentive provided by the continued receipt of the transfer is gone they may answer no – they didn't look actively in the last 30 days, because they already know from six months or more of active job search that jobs are not immediately available."