Hidden unemployment. Many Americans not counted in unemployment rate

Discussion in 'Economy' started by zzzz, Nov 8, 2010.

  1. zzzz
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    zzzz Just a regular American

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    The hidden unemployment is 1.2 million now. These are people who have quit looking for work but want to work. They are not included in the unemployment rate issued by the government. So in reality the unemployment rate is close to 10.3%. And this does not include the 1.4 million people who were in school or had family responsibilities and did not look for work in the last 4 weeks. Some of these people will be reentering the workforce at some future time. So if you add these people in the percentage it would approach 11.2%.

    According to the article once the economy begins to improve and more jobs become available these people will reenter the job force and keep the unemployment rate high because they will be counted then. There are differing opinions about how much impact as some economists believe the baby boomers that are retiring will compensate for this.

    I think that with the decrease in individual wealth of the baby boomers that they will need to work longer thereby offsetting for a few years the decreasing younger workers entering the workforce. A lot of retired people are below the poverty level now and with the increase in health care costs more will follow. We also have to allow for the influx of foreign workers coming into the workforce, especially if an amnesty program is put in for illegal’s.


    1.2 million people want a job but aren't looking | jconline.com | Journal and Courier

    Employment Situation Summary
     
  2. pinqy
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    pinqy Gold Member

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    To be precise, it's people who have looked sometime in the previous 12 months, aren't looking now, say they are available to work, but aren't looking because they don't believe they'd be successful. Including them, the UE rate would be 10.4% But since they've never been included in the count, that 10.4 is kind of meaningless unless you compare it to months that also include them.

    [qutoe]And this does not include the 1.4 million people who were in school or had family responsibilities and did not look for work in the last 4 weeks. Some of these people will be reentering the workforce at some future time. So if you add these people in the percentage it would approach 11.2%. [/quote] 11.1% is the official number.

    These aren't "hidden." They're tracked and available in the Employment Situation Report. They're excluded because they're not participating in the labor market and are only potential, not actual, sources of labor.

    Yep...as they start looking, but before they're successful, they'll raise the UE rate. Economists take a look at that because rising unemployment due to people re-entering the labor force is a positive sign (just as a drop in the UE rate due to people leaving the labor force is a negative sign).
     
  3. Norman
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    Norman Gold Member

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    I think even government has many measures, broader and less broader.

    The 9.5% is not too broad. The broadest is listed at shadowstats.org. They also have their own measures that is even broader and it sums to 22.5%.
     
  4. pinqy
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    pinqy Gold Member

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    BLS has 5 other measures of "underutilization:
    U-1 Persons unemployed 15 weeks or longer, as a percent of the civilian labor force

    U-2 Job losers and persons who completed temporary jobs, as a percent of the civilian labor force

    U-3 Total unemployed, as a percent of the civilian labor force (official unemployment rate)

    U-4 Total unemployed plus discouraged workers, as a percent of the civilian labor force plus discouraged workers

    U-5 Total unemployed, plus discouraged workers, plus all other persons marginally attached to the labor force, as a percent of the civilian labor force plus all persons marginally attached to the labor force

    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

    Persons marginally attached to the labor force are those who currently are neither working nor looking for work but indicate that they want and are available for a job and have looked for work sometime in the past 12 months. Discouraged workers, a subset of the marginally attached, have given a job-market related reason for not currently looking for work. Persons employed part time for economic reasons are those who want and are available for full-time work but have had to settle for a part-time schedule. Updated population controls are introduced annually with the release of January data.

    These have been in place since 1994. Shadowstats takes the U-6 and adds about 5 million more people on (he claims it's the number who would be marginally attached if there were no time limit) even though that makes the number far more than those who say they want a job, let alone those who are actually available to work.
     

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