Unemployment data for the final quarter
of 2012 has been released by the Bureau of Labor Statistics and we seem to have established the new normal under the Obama administration.
Here’s are the headlines:
- Official U3 unemployment = 7.8% (same as the third quarter)
- Obama unemployment = 9.8% (when you adjust for labor force participation when he entered office)
- Labor Force Participation remained the same as last quarter at 63.6%
- U6 unemployment dipped from 14.7% to 14.4%
Summary of U1-U3 Unemployment
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U1
= 4.3% (in blue)
U1 unemployment is the percentage
of the labor force that has been unemployed for 15 weeks or longer. As of
December 31, 4.3% of the labor force (approximately
8,617,608 individuals*) have been unemployed for more than 15 weeks. U1
unemployment is identical to last quarter.
U2
= 4.1% (in red)
U2 unemployment is the percentage
of the labor force who lost jobs or completed temporary work. As of December 31,
4.1% of the labor force (approximately
8,216,789 individuals) have lost jobs within the last quarter. U2 unemployment
is down from 4.2% last quarter.
U3
official unemployment = 7.8%
(in green above, blue below)
U3 unemployment is the official
unemployment figure and is the proportion of the civilian labor force that is
unemployed but actively seeking employment. As of December 31, 7.8% of the labor force (approximately
15,631,939 individuals) are unemployed and actively seeking work. U3
unemployment remains where it was
last quarter.
Summary
of U4 – U6 Unemployment
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U4
= 0.7%
or 8.5%
when added to U3 (in red)
U4 unemployment represents
discouraged workers, or those who have stopped looking for work. These
discouraged workers are in addition to the unemployed individuals captured by
U3 unemployment. As of December 31, 0.7%
of the labor force (approximately 1,402,866 individuals) are considered
discouraged, which is up from 0.5% over last quarter.
U5
= 0.9%
or 9.4%
when added to U3 and U4 (in green)
U5 unemployment represents
marginally attached workers, defined as those who “would like” and are able to
work, but have not looked for work recently. These marginally attached workers
are in addition to the unemployed and discouraged workers above. As of December
31, 0.9% of the labor force (approximately
1,803,685 individuals) are considered marginally attached, which is down from
1.0% last quarter.
U6
= 5.0%
or 14.4%
when added to U3, U4, and U5 (in purple)
U6 unemployment represents
part-time workers who want to be full-time. These underemployed workers are in
addition to the unemployed, discouraged, and marginally attached workers above.
As of December 31, 5.0%
of the labor force (approximately 10,020,474 individuals) are considered
underemployed, which is down from 5.4% last quarter.
Labor
Force Participation and Adjusted Unemployment
Labor Force Participation (LFP) is
unchanged from last quarter and remains historically low at 63.6%
(also from the Bureau of Labor Statistics).
Ideally, LFP should be rising. When LFP falls, that means people are leaving
the labor force but, while not working, will not be counted as unemployed.
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Labor Force
Participation is an important factor in determining unemployment because it
affects the denominator of the official unemployment calculation. You may have
heard news reports where 100,000 jobs were lost, yet the unemployment rate
remained unchanged. This is the effect of labor force participation.
Obama’s Unemployment Adjusted for
Labor Force Participation = 9.8%
It’s possible to
adjust unemployment by equalizing the labor force participation rate over time.
The following chart shows the U3 and U6 unemployment rates adjusted for the
labor force participation rate at the time when President Obama was inaugurated
(65.6% in Q1 2009).
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If the labor
force participation rate were the same as when President Obama entered office,
true unemployment this quarter would be 9.8% instead of 7.8%. Additionally, the
real rate of U6 adjusted for LFP would be 16.4%.
===
*Individual
counts are based on a current population of 315,109,241 (Census Bureau)
And according to Christina Romer's own projections, the unemployment rate wasn't supposed to go over 8% even with those larger participation rates.
ReplyDeleteYou used charts, H.R., so the left can ignorne your reporting of the facts accordingly. :)
ReplyDeleteHeathen and Paine, I consider myself part of the "true left" (and I'm not an Obama apologist, because he certainly isn't a liberal). Giving your analysis a cursory overview, I certainly don't dispute your conclusions.
ReplyDelete"Keep in mind that the 7.8% unemployment rate (U.3) that is headlined by the financial media does not include discouraged workers who have ceased to look for jobs. The government’s U.6 rate includes workers who have been too discouraged to seek work for less than a year. This rate of unemployment is 14.4%, almost twice the U.3 rate that the media prefers to report.
In 1994 the US government defined out of existence unemployed Americans who have been discouraged from finding work for more than a year. John Williams estimates the long term discouraged workers. When his estimate is added to the U.6 measure, the US unemployment rate stands at 23%, three times the reported rate."
Once the Right acknowledges that a coup d'etat has been in the making for decades, and is becoming more apparent with each passing day -- whether Democrat or Republican at the helm -- we'll all be better off.
When are you going to face the truth? America is now a corporatocracy. Until you understand and acknowledge this, along with your fellow conservatives, our slide toward oblivion will only accelerate -- no matter which wing of the Corporatist Party is running the show.
I'm still waiting for a real jobs plan from Obama and the Democrats (as opposed to efforts such as the past stimulus which caused unemployment to increase, and more recent proposed efforts which go to increase the power of labor unions and thus cause more people to be fired and more industry to flee the country).
ReplyDelete