Unemployment? U3? Do You Really Understand?
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:
Persons unemployed 15 weeks or longer, as a percent of the civilian labor force
Job losers and persons who completed temporary jobs, as a percent of the civilian labor force
Total unemployed, as a percent of the civilian labor force (official unemployment rate)
Total unemployed plus discouraged workers
Total unemployed, plus discouraged workers, plus all other marginally attached workers
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.