A Decade's Low Unemployment Claims: Not a Good Thing!

Last Thursday, the average of unemployment insurance claims was the lowest since Nixon was in Office; at least according to one headline.  Of course, this is even more outstanding when you consider the fact that the workforce was 40% smaller when Nixon was in office.

So, why should I be concerned over what seems to be such great news?

The reason is that, as of a year ago, 34% of our workforce were freelancers or independent contractors.  That's more than 53 million workers in 2014; almost double the 27 million freelancers in 2006 when they represented 18% of a smaller labor force of 151 million workers.  And, for sure, the number today is even higher than last year's 34%.  But, a critical point point to make is that these workers are not eligible for unemployment compensation whenever their services are no longer needed by a company.

Thus, we would probably have higher unemployment claims today if it weren't for the fact that a full one-third of our workforce is now self-employed.

Sadly, this is a growing trend as companies try to avoid the heavy burden of higher employment costs such as the employer mandate of ObamaCare; higher minimum wages in 29 states than the federal $7.25 an hour; and, Obama's new overtime rule for salaried workers.

It is now estimated that 40% of the workforce will be forced into a role of self-employment by 2020.  Not a good thing for the American worker and their families.  Thanks to over regulation of businesses, job security is vanishing in this country,.

References:

Jobless claims average hasn’t been this low since Richard Nixon: http://www.marketwatch.com/story/average-jobless-claims-havent-been-this-low-since-richard-nixon-2015-10-01

One in Three U.S. Workers Is A Freelancer: http://blogs.wsj.com/atwork/2014/09/04/one-in-three-u-s-workers-is-a-freelancer/

40% of America's workforce will be freelancers by 2020: http://qz.com/65279/40-of-americas-workforce-will-be-freelancers-by-2020/

How many freelancers are there? In 2006?: http://freelancersmovement.org/how-many-freelancers-are-there/

Labor Force Size By Year: http://www.dlt.ri.gov/lmi/laus/us/usadj.htm

State Minimum Wages | 2015 Minimum Wage by State: http://www.ncsl.org/research/labor-and-employment/state-minimum-wage-chart.aspx

Obama's new overtime rules: How they'd work and who they'd affect:  http://www.latimes.com/business/la-fi-obama-overtime-rules-explainer-20150630-htmlstory.html