Unemployment (U.S.)

newratings.com  10 hrs ago  Comment 
TAIPEI (dpa-AFX) - Taiwan's jobless rate remained unchanged for the third straight month in May, in line with expectations, figures from the Directorate General of Budget and Statistics, or DGBAS, showed Monday. The seasonally adjusted...
Financial Times  Jun 19  Comment 
After years of buoyant job creation, unemployment soars, while inflation rises and economy slows
Clusterstock  Jun 19  Comment 
A reader asked about the relationship between initial unemployment claims and monthly payroll employment. And if claims are so low, does that mean a surge in employment gains? There is definitely a general relationship as shown in the first...
Yahoo  Jun 19  Comment 
Unemployment rates rose in 25 U.S. states last month, driven higher in many cases by more people who began looking for work but didn't immediately find jobs. Rates fell in 9 states and Washington, D.C., ...
Market Intelligence Center  Jun 18  Comment 
This Thursday morning’s Initial Unemployment Claims number came in at a surprisingly low 267K, the lowest in nearly fifteen years. The market often reacts negatively to such good economic news, but the timing today was fortuitous, given...
MarketWatch  Jun 18  Comment 
The number of jobless workers seeking U.S. unemployment benefits fell again in mid-June and stood near a 15-year bottom, reflecting the steady pace of hiring across the nation and the unusually low level of layoffs. Initial jobless claims in the...
Yahoo  Jun 18  Comment 
The number of people seeking unemployment benefits fell last week, evidence that layoffs remain at unusually low levels and the job market is moving closer to full health. Weekly applications for jobless ...
Clusterstock  Jun 18  Comment 
WASHINGTON (Reuters) - The number of Americans filing new claims for unemployment benefits fell more than expected last week, pointing to a tightening labor market. Initial claims for state unemployment benefits dropped 12,000 to a seasonally...
Wall Street Journal  Jun 18  Comment 
Market Intelligence Center  Jun 18  Comment 
MarketWatch  Jun 18  Comment 
The number of people who applied for U.S. unemployment benefits fell by 12,000 to 267,000 in the seven days from June 7 to June 13, keeping initial claims near a 15-year low. Economists polled by MarketWatch had expected claims to total a...
Clusterstock  Jun 18  Comment 
Initial jobless claims tumbled last week. Claims fell 12,000 to 267,000, the lowest level since the week ended May 9. Economists had forecast that claims for unemployment insurance fell slightly to 277,000 last week from 279,000 the prior...




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This article is about unemployment in the U.S. To read more about unemployment in other countries, see Unemployment (disambiguation).

Unemployment and employment are closely watched economic indicators. A low rate of unemployment often raises inflation fears, due to potential labor shortages. High unemployment raises fears of recession. Strong job growth means prosperity. Job losses, recession. The chart to the right shows the annual unemployment rate from 1948 through 2007.

In looking at unemployment and employment there is ample room for confusion. Two separate and distinct measures of unemployment are often reported in the media, as well as two separate and distinct measures of employment. Each indicator has value, but must be understood correctly. All four are reported by the Bureau of Labor Statistics (BLS).

Unemployment

  • The “Unemployment Insurance Weekly Claims Report” is often cited in the press, with a focus on “initial claims” for benefits. An increase or decrease is popularly taken as a portent of the direction of the economy. A seasonally adjusted insured unemployment rate is also reported weekly. This measure of unemployment is not equivalent to the unemployment rate that is reported on a monthly basis by the BLS for several reasons: (1) Not all persons are covered by Federal or State unemployment insurance programs. (2) Some who are covered don’t file claims. (3) Some are still unemployed when their benefits run out and they drop out of the program.
  • A broader unemployment rate is estimated on a monthly basis by the BLS. The data that form the basis for the unemployment rate are gathered through a monthly survey of 60,000 households. This is called the Current Population Survey (CPS). The reference period is the week that includes the 12th day of the month. This is the unemployment rate that is used when economists and market analysis look at trends over time. Note that both measures of unemployment are revised annually, resulting in changes in previously reported unemployment rates.

Definitions and Discussion

The unemployed are defined by the BLS as “persons aged 16 years and older who had no employment during the reference week, were available for work, except for temporary illness, and had made specific efforts to find employment sometime during the 4-week period ending with the reference week.”

The unemployment rate is the number of unemployed as a percent of the labor force. The labor force consists of employed and unemployed persons. It is sometimes called the “civilian labor force” because it excludes people in the armed forces.

The size of the labor force varies over time due to economic conditions and changes in the number of working age people. When the economy is strong more people are apt to look for work and the size of the labor force swells. This could drive up the unemployment rate even when employment is growing. On the other hand, when jobs are scarce some people give up looking for work, which can result in a decline in the unemployment rate even as the economy weakens.

As the Baby Boom generation retires the size of the labor force might shrink, although a strong flow of young people into the labor force (the “Echo Boom” generation) and immigrants have the potential to keep the size of the labor force high enough. Many Baby Boomers may also delay the age at which they retire.

Illegal immigration is a complicating factor in the estimation of the number of employed and unemployed in this country. This “shadow labor force” is not well accounted for.

Employment

  • In the CPS (the survey of 60,000 households) each employed person is counted only once, even if he or she holds more than one job. Excluded are persons whose only activity consisted of work around their own house (painting, repairing, or own home housework) or volunteer work for religious, charitable, and other organizations. The employed include paid employees and those who work in their own business
  • The BLS also conducts the Current Employment Statistics (CES) survey of 390,000 business establishments. It yields a detailed breakdown of employment, hours and earnings for all major industrial sectors (except agriculture) and subgroups each month. When analysts talk about change in manufacturing jobs, for example, they are referring to the CES survey. The CES says nothing about unemployment.

The two surveys show different levels of employment and employment growth and have on occasion been contradictory due to the different samples and survey methodologies.

Unemployment Rate Since 1948
Unemployment Rate Since 1948
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