As you have probably heard, unemployment-claims are the lowest they have been in 42 years. However, I believe there is now a substantial political component to the data.

First, Republicans have about 10 more governorships now than they did in 2009. So, in general, it is probably harder to get unemployment benefits today. For example, one study found that Florida’s unemployment benefits are “virtually inaccessible.” Stricter eligibility rules might not effect initial claims, but they certainly would lower continuing claims.

Second, corporate lawyers may have found a loophole when doing layoffs. In a story about a massive IBM layoff, Bob Cringely reports:

“Some companies in some states have been known to report terminations in a way that disqualifies workers, thus saving the company money on unemployment insurance premiums.”

Third, corporations have been assiduously scrubbing their payrolls clean of citizens in favor of foreign employees working on visas such as the H-1B. The size of this scab army is probably large enough now to put a dent in the unemployment-claims data. To qualify for benefits, a worker must be ready and able to go to work immediately at any suitable job. An H-1B worker is only allowed to work for his sponsor, so his only options are to get rehired, find a new sponsor, or go home. I found conflicting opinions on this, but in general, foreign workers have fewer rights, which of course, is the whole reason why corporations favor them over citizens.

Essentially, as the USA moves to a more fascistic system, it is reasonable to expect an impact on the unemployment data. I don’t know how big the fascist component is now, and would love to see some research done by a professional economist.

Because of this, the withholding-tax data might be giving us an even clearer picture of the jobs situation than the claims data.