jerryguru69 (93.36)

Unemployment? U3? Do You Really Understand?

July 31, 2009 – Comments (1)

The unemployment rate you see quoted in the press is the so-called “U3”. To answer your next question, there is indeed a U1, U2, U3, U4, U5, and a U6. Do you know the difference? To discover the difference, see:

http://www.bls.gov/webapps/legacy/cpsatab12.htm

 

U-1

Persons unemployed 15 weeks or longer, as a percent of the civilian labor force

U-2

Job losers and persons who completed temporary jobs, as a percent of the civilian labor force

U-3

Total unemployed, as a percent of the civilian labor force (official unemployment rate)

U-4

Total unemployed plus discouraged workers

U-5

Total unemployed, plus discouraged workers, plus all other marginally attached workers

U-6

Total unemployed, plus all marginally attached workers, plus total employed part time for economic reasons

 As of 7/31/09, U6 = 16.8%. U3 = 9.7%

So, when you see that the “official” employment rate is 9.7%, this is useful as a comparison to other periods and the current trend. However, currently, to accurately judge the impact of unemployment, you have to realize that 17% or about one person in six either has no job or is working only part time.