September Unemployment: A Closer Look

October 5, 2012

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 The Trend In Employment Underutilization

While the Bureau of Labor Statistics (BLS) report documented that there were about 12.1 million Americans unemployed,4 that number only provides a glimpse toward understanding conditions in the labor market.

The BLS has a broader measure of total labor underutilization (U-6), often referred to as the rate of “underemployment.” This measure includes the total unemployed, plus those who have given up looking for work, and those who are working a part-time job but want full-time work. The alternative measure essentially looks at the percentage of the civilian labor force that would choose to have a full-time job if economic conditions were more positive. By that definition, today there are 23 million Americans still looking for work.  In January 2009, that figure was 22 million. In that same period, the U-6 rate has jumped from 14.2 to 14.7 percent5.

Additionally, when looking at the number of individuals employed, from January 2009 until today, there are 61,000 fewer individuals employed6.

 

The Time it Takes to Find a Job

The struggle for unemployed Americans to find jobs has become significantly more difficult for those individuals who are facing long-term unemployment. Out of the 12.1 million individuals looking for work, 3.4 million of them have been out of work for over a year and are still looking7. For all unemployed individuals, the average amount of time spent from time of unemployment until being hired in a new position has nearly doubled since 2009, rising from 19.8 weeks to 39.8 weeks8.

Individuals experiencing 8 to 9 months of foregone income can suffer from severe economic hardships, so it shouldn’t be surprising that a record number of Americans are receiving food stamps. As of the end of August 2012, nearly 47 million Americans were on food stamps. Additionally, it was recently reported that nearly 1 in 6 Americans were living in poverty in 2011, the highest rate in two decades9.

 

A Closer Look at the September Numbers10

  • Total nonfarm payroll employment rose by 114,000.
  • Unemployment rate: 7.8 percent
  • Total unemployed: 12.1 million
  • Total underemployed (unemployed, underemployed, or stopped looking): 14.7 percent
  • Total underemployed: 23.2 million11
  • Total stopped looking (marginally attached): 802,000
  • Long-term unemployed: 4.8 million

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  1.  Bureau of Labor Statistics. Labor Force Statistics from the Current Population Survey. January 2009. http://data.bls.gov/timeseries/LNS14000000 and Bureau of Labor Statistics. Labor Force Statistics from the Current Population Survey. September 2012. http://bls.gov/news.release/pdf/empsit.pdf
  2.  Bureau of Labor Statistics. Calculated by taking the sum of the Unemployment level (http://data.bls.gov/timeseries/LNS13000000), the Persons Working Part Time for Economic Reasons (http://data.bls.gov/timeseries/LNS12032194), and the Marginally Attached to the Labor Force (http://data.bls.gov/timeseries/LNU05026642) from January 2009. Accessed October 5, 2012.
  3.  Associated Press. US Jobless Rate Falls to 7.8 pct, 44-month low. October 5, 2012. http://finance.yahoo.com/news/usjobless-rate-falls-7-123110416.html
  4.  Bureau of Labor Statistics. Labor Force Statistics from the Current Population Survey: Unemployment Level. Accessed October 5, 2012. http://data.bls.gov/timeseries/LNS13000000
  5.  Bureau of Labor Statistics. Labor Force Statistics from the Current Population Survey: Alternative Measure of Labor Underutilization U-6. Accessed October 5, 2012. http://data.bls.gov/timeseries/LNS13327709
  6.  Mercatus. BLS Employment Numbers in Perspective. http://mercatus.org/publication/bls-employment-numbers-perspective
  7.  Bureau of Labor Statistics. Household Data A-35. Unemployed total and full-time workers by duration of unemployment. September 2012. http://www.bls.gov/web/empsit/cpseea35.pdf
  8.  Bureau of Labor Statistics. Labor Force Statistics from the Current Population Survey: Average Weeks Unemployed. Accessed October 5, 2012. http://data.bls.gov/timeseries/LNS13008275
  9.  Bloomberg. Rich-Poor Gap Widens to Most Since 1967 as Income Falls. September 12, 2012. http://www.bloomberg.com/news/2012-09-12/u-s-poverty-rate-stays-at-almost-two-decade-high-income-falls.html
  10.  All data presented here unless otherwise noted is sourced from: Bureau of Labor Statistics. Employment Situation - September 2012. October 5, 2012. http://www.bls.gov/news.release/pdf/empsit.pdf
  11.  Bureau of Labor Statistics. Calculated by taking the sum of the Unemployment level (http://data.bls.gov/timeseries/LNS13000000), the Persons Working Part Time for Economic Reasons (http://data.bls.gov/timeseries/LNS12032194), and the Marginally Attached to the Labor Force (http://data.bls.gov/timeseries/LNU05026642) from September 2012. Accessed October 5, 2012.

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