What is the current unemployment rate?

[baldguy]

http://www.mint.com/blog/finance-core/a-visual-guide-to-the-financial-crisis-unemployment-rates/

The overall unemployment rate currently stands at 7.2 percent, a 15-year high according to Bureau of Labor Statistics. Each day since the current recession began, in December 2007, the news has been full of reports of job layoffs. Just today the government released a report indicating that the number of Americans filing for unemployment benefits is at its highest level in a quarter of a century, as more workers seek government assistance. Could the news get any worse? It’s all in how you calculate the numbers.

Here is a visual guide to the truth behind the numbers

[prairierose]

1. Thanks, that is a great visual...

aid for explaining what is really going on.

[Veritas_et_Aequitas]

2. Great visual. Thanks!

[rurallib]

3. K&R - people need to know that the rate that is published is total bullshit

[texanshatingbush]

11. Underemployed total is similar to unemployed total, so.....

.....our true rate of people not working or working at only a fraction of their former salary is closer to 15%.

Sorry, no link, but I saw this on TV the other night--a story on workers at former AirborneExpress whose company was bought by DHL, and DHL is now closing the business in the US. Perhaps it was on "60 Minutes".

[KharmaTrain]

4. Beautiful...How The Goal Posts Have Moved...

I remember Raygun "revising" the basic indicators in the 80s and voila, unemployment went down. Of course, he and his minions took credit. Booooshie did the same thing...redefining "employment" as to being almost anything from part time cashier to big money CEO...as long as you had an "occupation", that was good enough. You create a lot of "job growth" when people need to take a second or third job to make a full time income.

[Crazy Dave]

8. Someone on McCain's campaign was dumb enough to use the...

"Well if anybody is working three jobs they should be grateful they have those three jobs"

Can't remember who or when but it got talked about a lot.

[KharmaTrain]

13. That Had To Be Tucker Bounds...

One of the worst sockpuppets ever...but I'm sure a rising star within the GOOP.

The other scam is the cost of living index...seems like we sure can live on a lot less the more they cost.

Cheers...

[Greyhound]

5. Very good, thanks for the chuckle. They left out one bit,

on the "can you collect unemployment" panel it should include "unless your former employer just lies about why you are unemployed".

[.... callchet ....]

6. And there are ovfer 12,000,000 out of work !

[elocs]

7. It is not a perfect or maybe even good way to exactly determine unemployment,

but at least it is consistent. It's like your bathroom scale which shows you as weighing 10 pounds more than you really do, but as long as it's consistently 10 pounds off too high you can adjust for what your true weight is. As much as the current system leaves to be desired it probably is better than what was used in the 1930s. I have been underemployed for 8 months now, only working 40 hours in one week, but there is no way that could be determined by anyone other than myself just as in the same way nobody but myself would really know if I had given up looking for work. I don't think it has ever been a secret that the officially reported unemployment statistics are actually quite low when compared with the true total.

[MajorChode]

17. It may not be as consistent as you think

You can certainly use it to track year to year variations, but Raygun changed the formula (which took effect around the early 90's), in order to "accurately" reflect all the jobs he was "creating". You know, the decent ones that came from manufacturing and were transferred to Wal-Mart type jobs.

However, perhaps the calculation should change from time to time to reflect the changing economy. It's practically impossible to compare 1930's unemployment with today because the economy was completely different. Most households had only one income earner and there were far fewer safety nets. Losing your job today is bad, but losing your job back then quite often meant your family was going to go hungry, if not starve. Death from starvation wasn't massive back then, but it did happen and illness from malnourishment was massive. I'm not trying to downplay the effect of poverty in the US today, but the fact is you have people below the poverty line who are obese and have cable TV. Poverty in the 1930's meant something else entirely.

[elocs]

19. Ultimately, unless using psychic mind readers there is no sure or exact way of determining

how many Americans have given up looking for work, exactly how many are unemployed but not collecting unemployment, or exactly how many have simply given up looking for work that they have found does not exist. I have never believed that the official jobless statistics are accurate, that it is nothing but a guess.

[MajorChode]

20. The unemployment rate determination works so long as you understand why

It works because it tracks quarter to quarter variations by looking at those most immediately effected. It shouldn't be used to track decade to decade.

It is not an "underemployment" rate, either. While underemployment most definitely significantly effects the population, that's not what the unemployment rate is trying to reflect.

[pinqy]

34. Monthly, not quarterly

[pinqy]

30. There was only one temporary change under Reagan

And that was including domestic military in the Labor Force alongside the other U5 measure (then the officail rate). The major redesign was based on a commission in 1979 and took effect in 1994. The ONLY change to the defintions of Employed and Unemployed is that prior to 1994, "Unemployed" included those who "were waiting to report to a new wage or salary job within 30 days." Now those people are required to have actively looked for work in the previous 4 weeks.

The major definitional changes were the creation of the category "Marginally Attached," defined as those who want to work, are available to work, had not looked for work in the previous 4 weeks, but had in the previous year, and the adding of the one year requirement for "Discouraged Workers," those Marginally Attached who stopped looking because they didn't think they could find a job. These are in the "Not in the Labor Force" category, so changing the definition had zero change on the Unemployment Rate.

[RUMMYisFROSTED]

9. k/r

[qtel86]

10. thank you

thank you a lot for this posting

[bdamomma]

12. see this article too.

http://www.stateline.org/live/details/story?contentId=372388

[ananda]

14. The a c t u a l unemployment rate in real numbers..

.. is easily in double digits.

And then there are the stinky, shitty
part time jobs with no benefits...

[Orwellian_Ghost]

15. Yep

K&R

[melm00se]

16. Historical unemployment

figures:

http://research.stlouisfed.org/fred2/data/UNRATE.txt

Since 1948 unemployment:
High 10.8% (12/82)
Low 2.5% (6/53)

these are BLS #s

[MajorChode]

18. You have to chuckle sometimes with the way Republicans spin the numbers

I remember during Bush's first term how the pugs would always spin the numbers in their favor.

O'Lielly said "the average unemployment during the Bush administration is the same as it was during the Clinton administration." What he said was true, however it conveniently ignores the fact that unemployment went down every single year of the Clinton administration and went up every single year of the Bush administration (at that time).

The pugs latest bit of nonsense is declaring the New Deal a failure. Brit Hume tells us, "everybody agrees, I think, on both sides of the spectrum now, that the New Deal failed." As long as your "spectrum" begins with Cato and ends with the Heritage Foundation, that may be so. However even Bush's boy Bernanke agrees that the New Deal was a great success as does every other credible economist.

Pat Buchanan adds to the circle jerk by saying the New Deal failed because unemployment never rose above 14%. The problem with his statement is it ignored that unemployment improved continuously except for a brief period when Roosevelt conceded parts of his plans to conservatives and the economy went into a brief recession. Furthermore the Heritage Foundation chart that Buchanan relied upon showed unemployment at 37% at the start of the New Deal.

[elocs]

21. Does this mean that Democrats never spin numbers that favor us?

Choosing to view the glass as half full or half empty depends upon whether it is your glass or not.

[MajorChode]

22. Not nearly to the extent of the Republicans

Keep in mind the pugs have many more outlets where hacks appeal to their masses which crave spin. Talk radio, Fox "news", columnists and book authors, etc. I don't blame the supply as much as the demand.

Certainly the Democrats have some hacks, but it's a drop in the bucket compared to the other side of the political spectrum.

[sarcasmo]

23. Kick.

[pinqy]

24. Way to not let the truth get in the way.

Why on Earth are they lying and saying people with a part time job who looked for full time are not employed or unemployed?

As for "how they calculated unemployment 80 years ago," they guessed their asses off. There were no surveys or official calculations. They didn't even have definitions for unemployed. The numbers cited for the unemployment rates of the 20's and 30's are estimates first published in 1948.

[baldguy]

26. These are for you.

Keep listening to Sean.

[pinqy]

27. I'm open to your facts

Or can you only deal in mindless insults?

[baldguy]

28. Forgive me, I was thrown off by your statement that economists in the '20s & '30s "guessed their ass

Of course the Neanderthals in pre-history before WWII had absolutely no concept of numbers. When the US Bureau of Labor was started in 1884 they had no idea of what "work" was and was not, and John Maynard Keynes had to use his fingers & toes to do his calculations - along with the stay pebble or two.

Again, please forgive me. Mindless insults should be reserved for people who have no clue what they're talking about.

[pinqy]

29. They had a concept of numbers.

But they did NOT have a coherent definition of Unemployment. Prior to a 1937 mail survey by the Census, the method used was to ask people if they had an occupation for which they had received pay. This is very different from the "activity concept" that's been used since then. Employment was first measured in 1915, but Unemployment was not. Census made some attempts in the 30's but no systematic or regular survey was undertaken until 1940. BLS didn't take over until 1959.

Now, if you can give cites for the surveys done, and their methodology, I'll read them. But there was nothing useful from that period. As I said, the estimates for that period, now considered official, weren't published until 1948.

[supernova]

25. 13.5% is what I heard on a ML webcast last night

I'm a ML investor. :P

Anyway, they had a roundtable discussion for clients, and I tuned in.

13.5% UI was the number they used.

I'm curious, who are the extra 4% who would bring it to 17.5%? I'm not questioning it's veracity, just wonder what's behind those numbers. I'm in that category that has felt like giving up on looking for work. I'm just flat out exhausted. What's worse, I can't afford to be. x(

[crispini]

31. UGH!

I KNEW IT.

[readmoreoften]

32. And it doesn't even take "freelancers" and "independent contractors" into consideration.

That's a serious chunk of society.

[pinqy]

33. Yes, it does.

Self-employed etc are all included. The question is whether you worked for pay for at least one hour in the reference week or at least 15 hours as an unpaid family worker.

Now the Employment Figure is non-farm establishment and doesn't include them, but that's not what's used in the Labor Force figures.

[Orwellian_Ghost]

35. Reality kick