Real March Unemployment Rate: 11.6%

Today, we got the laughable news that the unemployment rate declined even as those not in the labor force grew by over 660,000, while the total civilian non-institutional population grew by just 167,000 to 244,995, meaning the actual labor force declined by 496,000. Which is precisely the issue: fudging the labor force participation rate is how the Obama administration has managed to maintain the myth the economy has grown under his leadership for the past 4+ years.

It hasn't, and in fact if one renormalizes for the recent long-term average participation rate of 65.8%, one gets a very different number. How different? A difference that is now at a record compared to what is reported. As the chart below shows, a "renormalization" process indicates a massive and record 4% difference between the reported unemployment rate of 7.6%, and what the real unemployment rate is assuming normal growth of the labor force, which in March was 11.6%, up from 11.3% in February, and the highest since August 2012 when it was 11.7%. More importantly, as the real unemployment chart shows, the economy has not improved by one bit since 2009! Read more >>

Fake +290K Payrolls "Added", Real Number Is 36K

290K of which census was 66k and Birth Death was 188k. Hurray -the economy added a real 36k in jobs in April. Still, we are curious how the Chairman will not be forced to discuss tightening after this B/D adjustment inspired number (188K in April B/D, 81K in March). And in the meantime, headlines will read Unemployment back to 9.9%, and Underemployment back to 17.1%. Record jittery market bounces than calms down again. More...

The Real Job Loss Pain Number Is 54%

businessinsider.com
A March survey from Pew shows just how broad the unemployment pain has been felt. When you hear of 10% unemployment, you might imagine 1/10th of Americans experiencing extreme financial stress from the recent recession.

Yet given the unemployment rate's odd methodology whereby it drops people who stop looking for work out of the data, and the fact that American households usually have more than one person, the real 'pain' number is 54% -- over half of American households felt the direct impact of job losses:

Pew Research:

A majority now says that someone in their household has been without a job or looking for work (54%); just 39% said this in February 2009. Only a quarter reports receiving a pay raise or a better job in the past year (24%), while almost an equal number say they have been laid off or lost a job (21%).

Basically, if your household didn't experience un- or under-employment, then you are in the minority. Moreover, as shown above, fully 70% of American households experienced one of the serious financial problems above. Basically, the vast majority of American households was hit extremely hard.

17.9 Percent Real Unemployment

Image via Wikipedia

17.9 Percent Real Unemployment - How Solid is the Recovery?
Simon Maierhofer
The unemployment picture painted by today’s jobs report headlines is much rosier than reality. Still, they were enough to provide a serious pop for stocks. What are the real numbers and will reality seriously ding the market?

How do fish get caught? They open their mouth. How do investors get ensnared or misled? They believe in non-existent phenomenon like a “jobless recovery.”

Surprising as it is, for nearly a year, investors have shrugged off mounting jobless claims and rising unemployment as an ingredient that is not really required for an economic recovery.

In reality, real unemployment is at 17.9%, 0.1% short of last month’s all-time high. Yes, 17.9%! This is the official number reported by the Bureau of Labor Statistics (BLS).

The BLS publishes different sets of data on a regular basis. The main focus tends to be on the U-3 unemployment rate (currently 9.7%, seasonally adjusted).

U-3 is the “official” unemployment rate and illustrates total unemployed persons as a percentage of the civilian labor force. Another category – U-4 – includes unemployed workers plus discouraged workers. A discouraged worker is someone who’s available to work but has stopped actively seeking for work.

U-5 unemployment includes the number of unemployed workers, plus discouraged workers, plus marginally attached workers. A marginally attached worker is someone who is able and willing to work but is not actively seeking work.

U-6 is as close to the real unemployment figure as government reporting gets. This number includes unemployed workers, plus discouraged workers, plus marginally attached workers, plus workers that are forced to work part-time because they are not able to find a full-time job.

According to the Bureau of Labor Statistics, the number of U-6 unemployed workers is 17.9% (not seasonally adjusted – 16.8%, an all-time high). More...

“Real” unemployment rate in US is 22%

Image via Wikipedia

layofflist.org
The media and government officials often tout the unemployment rate using the official, or U3 rate, which stands at 10.2% for October. While 10.2% unemployment is certainly bad enough – it’s the highest rate nationally excluding 1983s 10.8% - it pales when compared to the U6 unemployment rate. First let’s discuss the differences between U3 and U6 measures.

According to the Bureau of Labor Statistics (BLS) the U3 measure is described as “total unemployed, as a percent of the civilian labor force (official unemployment rate).” Now let’s take a look at the BLS U6 measure: Total unemployed, plus all marginally attached workers, plus total employed part time for economic reasons, as a percent of the civilian labor force plus all marginally attached workers.

When including marginally attached workers and those forced to work part-time instead of full-time we have a national unemployment rate of 17.5%, which is nearly 70% higher than the U3 rate of 10.2%. That’s a dramatic increase from the normally quoted U3 unemployment rate, but even U6 fails to provide the actual percentage of people who are, or may be considered unemployed.

John Williams discusses alternative unemployment data sets at his Shadow Government Statistics site. Their service, in part, “exposes and analyzes flaws in current U.S. government economic data and reporting.” Once those flaws are included in the unemployment calculation – called the SGS Alternate - the unemployment rate reaches 22%. Shadow Government Statistics gives the following reason for SGS Alternate measure: “The SGS Alternate Unemployment Rate reflects current unemployment reporting methodology adjusted for SGS-estimated “discouraged workers” defined away during the Clinton Administration added to the existing BLS estimates of level U-6 unemployment.”

To clarify why the discrepancy between U6 and the SGS Alternate rate of 22%, I contacted the BLS and received the following answer to my question about the change in discouraged worker designation during the Clinton Administration:

“(P)rior to 1994 persons were not asked whether they had searched for work recently. If they gave one of the five “discouraged worker” reasons for not looking for work in the past 4 weeks, they were assumed to have “given up” the search for work, although they weren’t asked when they had last looked. As a result of the greater specificity introduced in 1994, the number of discouraged workers was cut approximately in half, from about 1.1 million in 1993 to 500,000 in 1994.”

About 600,000 people were removed from the unemployment calculations in 1994, so if you merely add those 600,000 to the current U6 number, the rate of unemployment would be much higher than 17.5% and would more accurately be reflected in the SGS Alternate unemployment rate of 22%.

The BLS now offers the U6 measure of unemployment for states. An example is New York’s U6 rate averages 13.4% for the period fourth quarter of 2008 through third quarter of 2009 at: Alternative measures of labor underutilization by state. So making the simple assumption that the SGS Alternate data is, on a national level, about 4.5% higher than U6, the unemployment rate in New York is closer to 17.9%, and that’s being conservative since the current unemployment rate is higher than the average presented at the BLS.

When nearly 1 in 5 eligible New York workers are either unemployed or underemployed, we are made aware of the brutal state of employment. Maybe it’s time to spend more money on job creation, instead of pumping billions of dollars into the coffers of banking bonus babies and corrupt banks and institutions that were made too big to fail by two presidential administrations more concerned about campaign money than taxpayer needs.

A sliver of good news, according to John Williams, is that during the Great Depression the SGS Alternate measure of unemployment would likely be near 34%. Let’s hope our elected “representatives” don’t aim for those lofty unemployment levels.

If you would like to follow my Examiner.com posts, they are located at Rochester Unemployment Examiner’s Articles.

“When plunder becomes a way of life for a group of men living together in society, they create for themselves in the course of time a legal system that authorizes it and a moral code that glorifies it.” – Frederic Bastiat (1801-1850)

Six Unemployed For Every Job

According to MarketWatch:
The number of open U.S. jobs fell 50% over the past two years to a seasonally adjusted 2.4 million in July, the lowest in the brief history of the data, the Labor Department reported Wednesday.

The job-opening rate fell to a record-low 1.8% in July.

Job openings track the demand for labor, the flipside of the unemployment rate, which measures the supply of labor. Read the full government report.

In July, there were 6.05 unemployed people for every job opening, according to the most recent data on labor turnover. In December 2007, when the recession began, there were 1.72 unemployed people for every job opening.

The number of workers hired in July was little changed at 4.06 million, while the number of workers separated from their jobs was little changed at 4.29 million. The hires rate rose to 3.1%, while the separations rate remained at a series-low 3.3%.

In the past 12 months, hires have fallen 13.9%, while separations are down 12.8%.

Layoffs were little changed in July at 2.3 million, while 1.7 million people quit their job. Layoffs have increased 15% in the past year, while quits are down 32%.

In the 12 months ending in July, hires totaled 51.3 million, and separations totaled 56.6 million, with a net job loss of 5.3 million.