Unemployment rate: 9.4% but expected to go up further as of this writing (August 31, 2009) even though it dipped slightly from 9.5% not too long ago. Actually there are seven different unemployment rates! Don't let the media fool you.
No matter what the rate, people who want to work and cannot find a job translates into an economy that needs further growth.
The official unemployment rate is U-3 but the comparisons for U-1 through U-7 are available (back to 1948), even though the measures of unemployment were redesigned in 1994. U-6 in 1994, for example, was 10.9% versus the 6.1% U-3 measure.
As you move from U-1 through U-7 more and more people are included in the numbers of unemployed so it is important to compare data consistently from each time period . Here is the .pdf describing the unemployment rate calculations:
http://www.bls.gov/opub/mlr/1995/10/art3full.pdf
Since 1948, the measures are, indeed, consistently measured from time period to time period.
Although, some might argue that U-6 is a more appropriate measure (because it includes people looking for work, people who have given up and those working part-time who would like to be working full-time, etc.), you would have to compare U-6 of 2009 to U-6 of 1983-4.
For example, you would find that the unemployment rates really are about the same during the early '80's (in the high 14% to low 15% range in the early eighties) as U-6 is now in 2009. In addition, U-3 (the most commonly used measure because it is a more realiable way to calculate it - let's face it, how do you know if someone working part-time really wants a full-time job?) is 9.4% today and we were in a similar situation in the eighties.
More research data if you are interested at this website:
http://data.bls.gov/PDQ/servlet/SurveyOutputServlet
If the 15.8% (at the end of April for U-6 which actually went down to 14.8% by the end of May even though U-3 continues to climb and is now at 9.4%) is comparable to a 15% rate in 1983-4, then it is not as “scary” as it is often portrayed in the media and some workshops I have attended. Whether you say the unemployment rate is 9.4% (U-3 measure) or 14.8% (U-6 measure), the 2009 time period still compares closely to the 1983-1984 time period.
An Introduction
Hi. Welcome to BourGroup and my blog. Phil
Phil Bour is a CERTIFIED FINANCIAL PLANNER(tm) professional since 2004, a Magna Cum Laude college graduate and an accounting professional for over 35+ years. I love numbers, statistics and economic history.
I am also an Enrolled Agent (EA) to represent taxpayers before the Internal Revenue Service and to prepare tax returns.
"Phil"osophy: I believe that you can manage your money on your own (not necessarily through individual stock selection but through mutual funds, ETF's and other solutions) once you receive some one-time, professional guidance. Why pay annual fees when there may be little added value? For additional information, first read the "An Introduction" label at the left. Then move on to others.
Phil Bour is a CERTIFIED FINANCIAL PLANNER(tm) professional since 2004, a Magna Cum Laude college graduate and an accounting professional for over 35+ years. I love numbers, statistics and economic history.
I am also an Enrolled Agent (EA) to represent taxpayers before the Internal Revenue Service and to prepare tax returns.
"Phil"osophy: I believe that you can manage your money on your own (not necessarily through individual stock selection but through mutual funds, ETF's and other solutions) once you receive some one-time, professional guidance. Why pay annual fees when there may be little added value? For additional information, first read the "An Introduction" label at the left. Then move on to others.