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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:



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.


1 Comments – Post Your Own

#1) On August 01, 2009 at 2:11 AM, awallejr (33.36) wrote:

Except that U6 numbers inclusion of part time workers makes the stat itself open to too much interpretation.  U3 is crystal clear.  U6 you can have a household with 2 fulltime workers with one knocked down to part time (probably not an uncommon event right now).  Under that scenario, the household itself is most likely still solvent.

I can't tell you how many summers during my college days I had to work 2 part time jobs instead of one fulltime job.  And according to U6 definition per the BLS I would be unemployed.

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