U.S. unemployment at 15.8% according to wider measure

Yesterday, Minnesota Public Radio highlighted a measure of unemployment (called the U-6 by the Bureau of Labor Statistics) that gives a more comprehensive picture of unemployment than the more widely reported unemployment rate. It also reveals a bleaker employment outlook for workers. As Minnesota Department of Employment and Economic Development analyst Steve Hine said in the MPR story: “The U-6 measure shows the extent of the hard times. This has been an incredibly deep recession.”

The official measure of national unemployment (called the U-3 by the Bureau of Labor Statistics) stands at 8.9% as of April 2009 (in Minnesota, it’s 8.1%). The trouble with the official U-3 unemployment statistic is that it only counts unemployed people who are looking for a job. That leaves out at least two important groups of people:

  • Those who are “underemployed” – people who want to work full-time but can only find a part-time job. Although many people working part-time do so voluntarily, the underemployed are those working part-time involuntarily – they could and want to be contributing more. That translates into millions of people whose labor is being underutilized.
  • Those who are “marginally attached workers” – people who are no longer looking for work. These could be people who couldn’t find work and gave up looking, or people who have a barrier (like child care or transportation) that prevents them from getting work.

The U-6 unemployment measure counts the unemployed, underemployed and marginally attached workers. This more comprehensive measure puts national unemployment at 15.8% – significantly higher than the official unemployment rate.

Unfortunately, the state of Minnesota does not measure the more comprehensive U-6 statistic at the state level.  MPR reported that the Governor vetoed a measure that would have allowed the state to collect this more comprehensive employment information, saying it duplicates data already supplied by the federal government.

But Minnesota has historically had a much different employment trend than the U.S., and it’s a shame we won’t track the more comprehensive story of unemployment here in Minnesota. Meanwhile, if you want to know the real national picture of unemployment and lost economic potential, look at the U-6 statistic.

-Katherine Blauvelt

About Katherine Blauvelt

Katherine Blauvelt served as the Minnesota Budget Project’s policy analyst from 2007 to 2009.
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One Response to U.S. unemployment at 15.8% according to wider measure

  1. Joe Grimmes says:

    Well, U6 unemployment statistic is interesting. Now at 16.7 %, September 2009. But 35 million people on food stamps is even more interesting. Or nearly 11% of the total US population in poverty.

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