DENVER, Colorado — At the beginning of August, the number of Americans who signed up for unemployment benefits rose to the highest level since November. These numbers are rising all while the number of jobs being added by U.S. employers are also increasing—528,000 in July to be exact.
Kishore Kulkarni, a professor of economics at Metropolitan State University in Denver explains people's specifications play a big role.
“There are jobs in certain areas; there are no jobs in some other areas," Kulkarni said. “That has also reflected in to people not finding as many jobs because labor is very reluctant to go back to work unless they are paid more. And the reason they need to be paid more, one is of course inflation.”
He says inflation has caused those seeking jobs to be more intentional about the professions they seek out, and that reality will take time to dissipate.
“Inflation will slow down when the war stops. Inflation will slow down when money supply growth declines. Inflation will slow down when the interest rate goes up," Kulkarni said.
We asked him if people are making more money by filing for unemployment rather than getting whatever job they can.
“Nobody really makes more money by just filing for unemployment and benefits. What you do get is unemployment benefits and you get some liberty on your time," Kulkarni said.
The Labor Department is also reporting that the unemployment rate is decreasing. In July, it dipped to 3.5%, which ties a 50-year low from 2020. We asked Kulkarni how that works if more people are filing for unemployment.
“The way we calculate unemployment is that in order for you to be seen as an unemployed person, you have to actively search for a job," Kulkarni said.
So, essentially, if you’re not looking for a job, you are neither an employed nor unemployed individual and are not included in government calculations.
“The US economy and the global economy as a whole literally fell off the cliff in March of 2020," Kulkarni said. “This did not happen in one month or one quarter. It’s not going to come back in one month or one quarter. It has to be a little bit longer view of how things will get back to normal.”