Real joblessness at 16.7%

Rick Moran
The Wall Street Journal offers a good explanation for the difference between the official unemployment rate and the true state of the joblessness problem:

The U.S. jobless rate rose to 9.6% in August, but the government's broader measure of unemployment rose even more to 16.7%, the highest rate since April.

[...]
Both rates increased despite a rise of 290,000 in the number of people who are employed. The number of unemployed people in the U.S. also rose, but by a smaller amount - 261,000. The unemployment rates moved up as more unemployed people moved back into the labor force to look for jobs. More than half a million people re-entered the job market last month, as the overall labor force rose 550,000.

[...]

The 9.6% unemployment rate is calculated based on people who are without jobs, who are available to work and who have actively sought work in the prior four weeks. The "actively looking for work" definition is fairly broad, including people who contacted an employer, employment agency, job center or friends; sent out resumes or filled out applications; or answered or placed ads, among other things. The rate is calculated by dividing that number by the total number of people in the labor force.

The U-6 figure includes everyone in the official rate plus "marginally attached workers" - those who are neither working nor looking for work, but say they want a job and have looked for work recently; and people who are employed part-time for economic reasons, meaning they want full-time work but took a part-time schedule instead because that's all they could find.

In some areas of the Midwest, that U-6 figure easily tops 25%. When you walk into a McDonalds and see 40-something employees manning the counter, you know that jobs are tough to come by. Even part time work is being taken by adults who can't find a job, leaving kids out in the cold this past summer.

There is little prospect that things will improve soon, no matter who is in power in Washington.


The Wall Street Journal offers a good explanation for the difference between the official unemployment rate and the true state of the joblessness problem:

The U.S. jobless rate rose to 9.6% in August, but the government's broader measure of unemployment rose even more to 16.7%, the highest rate since April.

[...]

Both rates increased despite a rise of 290,000 in the number of people who are employed. The number of unemployed people in the U.S. also rose, but by a smaller amount - 261,000. The unemployment rates moved up as more unemployed people moved back into the labor force to look for jobs. More than half a million people re-entered the job market last month, as the overall labor force rose 550,000.

[...]

The 9.6% unemployment rate is calculated based on people who are without jobs, who are available to work and who have actively sought work in the prior four weeks. The "actively looking for work" definition is fairly broad, including people who contacted an employer, employment agency, job center or friends; sent out resumes or filled out applications; or answered or placed ads, among other things. The rate is calculated by dividing that number by the total number of people in the labor force.

The U-6 figure includes everyone in the official rate plus "marginally attached workers" - those who are neither working nor looking for work, but say they want a job and have looked for work recently; and people who are employed part-time for economic reasons, meaning they want full-time work but took a part-time schedule instead because that's all they could find.

In some areas of the Midwest, that U-6 figure easily tops 25%. When you walk into a McDonalds and see 40-something employees manning the counter, you know that jobs are tough to come by. Even part time work is being taken by adults who can't find a job, leaving kids out in the cold this past summer.

There is little prospect that things will improve soon, no matter who is in power in Washington.