January 22, 2013

Official Unemployment vs Unemployment, marginal and Underemployment 1993 too 2012

How many times have you seen this kind of statement in the last few years? :  "The official unemployment rate cited by the government is 7.8% but the REAL unemployment rate is 14.4% if you include the underemployed."    Of course the underemployed and marginally attached workers are out there when the economy is good too.   When unemployment was 5% were people running around making sure we were all aware that the 'REAL' rate was 9.2%?   Not that I recall.

I pulled the numbers for a few years back off the BLS Table A-15 charts Here's a look at the official unemployment rate versus the larger rate including marginally attached and underemployed part time workers from 1994 to 2012 :

(click for larger size)

Those numbers are monthly seasonally adjusted figures for
U-3 Total unemployed, as a percent of the civilian labor force (official unemployment rate)
U-6 Total unemployed, plus all persons marginally attached to the labor force, plus total employed part time for economic reasons, as a percent of the civilian labor force plus all persons marginally attached to the labor force

As you can see in the chart the broader U-6 unemployment measure plus the marginally attached and underemployed workers is generally a few points higher than the simple unemployment measure.   The numbers are roughly proportional as well.    The marginal and underemployed number is around 60-80% of the unemployment number.


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