Fact Checker: Ernst on national unemployment, wages

INTRODUCTION

'We see our neighbors agonize over stagnant wages and lost jobs.”

SOURCE OF CLAIM

Iowa Sen. Joni Ernst in GOP rebuttal to President Barack Obama's State of the Union address.

ANALYSIS

Ernst's statement is brief, but implies a lot, namely that American wages have not changed while workers lose jobs.

First, we'll look into the nation's unemployment rate, according to information provided by the Bureau of Labor Statistics.

According to a Jan. 9 economic news release, the national unemployment rate dropped by .2 percent to 5.6 percent in December - making for 8.7 million unemployed people in the country, according to household survey data.

In 2014, the number of unemployed people dropped 1.1 percent, or by 1.7 million people.

Last year total nonfarm payroll employment averaged a growth of 246,000 new jobs per month, compared to a monthly growth of 194,000 jobs in 2013.

Unemployment reached 15.3 million people - making for 10 percent - at the close of 2009 and has been declining since. Before the economic downtown in 2007, unemployment was at 4.5 percent - making for 6.8 million people - in 2006.

Shifting gears to look at national wages, the Bureau of Labor Statistics' Jan. 22 report on the average hourly earnings shows an overall growth across the board last year.

Real average hourly earnings on private nonfarm payrolls increased by 1 percent from Dec. 2013 through Dec. 2014. Combined with a .9 percent increase in the average workweek, real average weekly earnings rose by 1.9 percent over the year.

Average hourly earnings have been increasing slowly since 2009, when they dropped by .9 percent.

Inflation also comes into play when discussing wages. According to the bureau's Consumer Price Index report, which measures prices paid by urban consumers, the price index increased .8 percent last year following a 1.5 percent increase in 2013.

Last year's price index increase is the second-smallest annual increase in the last 50 years, according to the report.

To simplify and look the five-year change using the bureau's inflation calculator, $1 today has roughly the same buying power as 92 cents did in 2010.

CONCLUSION

Ernst's use of the term stagnant implies little to no change in employed American's wages.

She is mostly right in that the average hourly earnings haven't grown significantly since the recession, but they have seen an annual increase that is in line with inflaton.

Ernst also said the nation has been suffering with lost jobs.

While the national unemployment rate hasn't reached the level it was before the 2007 economic downturn, unemployment has been declining since it peaked at roughly 15 million people in 2009.

Some markets are feeling the lingering effects of the recession more than others, but as a whole, the nation's unemployment rate has been dropping slowly for the last five years.

In the end, Ernst makes major claims in her statement, but the numbers disagree.

Overall, we score this a C.