Monday, December 5, 2011

Why the November 8.6% headline unemployment number from Friday isn't what it seems to be!

Ways that the mainstream media measures unemployment!

The headline November employment number released on Friday showed an improvement to an 8.6% rate from 9.0% in October although only 120,000 new jobs were created.

This is curious because it has been estimated that in order to just keep up with the growth in U.S. population the economy would have to add 150,000 jobs a month for the unemployment rate to just stay the same.

Ways the Bureau of Labor Statistics measures unemployment!

It's the U6 number that is of course the most relevant although it is the one that is least frequently reported.

U1: Percentage of labor force unemployed 15 weeks or longer.

U2: Percentage of labor force who lost jobs or completed temporary work.

U3: Official unemployment rate per the ILO definition occurs when people are without jobs and they have actively looked for work within the past four weeks.

U4: U3 + "discouraged workers", or those who have stopped looking for work because current economic conditions make them believe that no work is available for them.

U5: U4 + other "marginally attached workers", or "loosely attached workers", or those who "would like" and are able to work, but have not looked for work recently.

U6: U5 + Part time workers who want to work full time, but cannot due to economic reasons (underemployment) (Source)

The unemployment story behind the unemployment story!

In order to get a better idea of the true state of the employment situation in the United States read the article "Unemployment rate lies, exaggerations ..." at Citizen Wells News here.

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