February Employment Situation
Once again, the headline unemployment number for February, which droped from 9.0% to 8.9%, hides much weakness in employment, despite the 193k new payroll jobs. Indeed, the BLS’ own U-3 unemployment rate, which is calculated in a similar fashion to mine, increased from 9.8% to 10.4%.
For my methodology, the numbers look like this:
Civilian noninstitutional population: 238,851,000
Historical participation rate: 66.2%
Proper labor force size: 157,641,660
Actually employed: 138,093,000
Actual unemployment rate: 12.4%
At the end of the day, we need another 8 million new jobs to bring us back to full employment.
The current labor participation rate is 64.2%.
So if one wants to go with how the government is calculating unemployment one has to assume that about 2% of the labor force is never going to get their jobs back.
Chart pr0n #1
http://www.zerohedge.com/article/labor-force-participation-rate-remains-25-year-low-642-birthdeath-adjustment-112000
Chart pr0n #2
http://www.zerohedge.com/article/civilians-not-labor-force-hits-all-time-record
#2 is the scary one. While a demographics crunch is expected in the form of retiring baby boomers, it really hasn’t materialized. When it does, things will get much, much worse. We could very well end up with a highly unemployed work force being depended on for funding the welfare state. That is kinda hard to do without a job.
Actually, the current labor force participation rate is 63.9%.
BLS says 64.2%
http://data.bls.gov/pdq/SurveyOutputServlet?data_tool=latest_numbers&series_id=LNS11300000
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But the point is still valid. A lower labor participation rate is driving unemployment down. This hints at structural problems in getting people back to work.
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You’re using the seasonally adjusted rate. I don’t.
Gallup’s take on unemployment.
http://www.gallup.com/poll/146453/Gallup-Finds-Unemployment-Hitting-February.aspx
The short version:Â Unemployment is 10.3% and under employment is 19.9%.
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Wait ’til the $4 +++ gasoline kicks in.
Inflation will shoot up…economic activity will nose-dive.
Good thing the CPI doesn’t include energy. People might think they were paying more otherwise!
/facepalm
Dale, you have been great posting the real unemployment rate each month. Any chance you might graph your measurements against the official report numbers? Thanks
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It’s hard to believe unemplyment within this country is so high. I wonder how recent events (including Japan and the uprisings within the Middle East) will effect us in the long run.