The U.S. Bureau of Labor Statistics (BLS) released the newest unemployment data for June 2015 on the first Thursday of July (rather than Friday due to the holiday). According to the BLS, the current “Seasonally Adjusted” Unemployment Rate for June is 5.3% down from May’s 5.5%. The BLS reported the “Unadjusted” Unemployment Rate is 5.5% which is lower than January’s 6.1% equal to last October’s unadjusted 5.5% but up from April’s 5.1%. See Current Unemployment Chart and Job Growth Stalls, Labor Participation at 38-Year Low for more information. The BLS issued their “preliminary estimates” for the employment situation for the month of June 2015. The report states 142.589 million jobs reported. That’s up 455,000 from May. But at the same time they revised the numbers for May down by 58,000 making the real gain (compared to the numbers they reported last month) 397,000. See Current Employment Commentary for more information.
Historical Employment Levels Compared to Recessions
In addition to the number of jobs from 1939 through the present this chart shows the recessions shaded blue as per the official description of a “recession” by the National Bureau of Economic Research (NBER). Although during some periods which are classified as official recessions the unemployment rate didn’t skyrocket generally, recessions correspond pretty well to declines in employment (i.e. increased Unemployment). This is especially true since unemployment is one of the factors NBER uses to determine whether there is an official recession. But theoretically if all the other factors line up employment could remain steady and the economy could be in a recession. See Employment During Recessions for more information. In this chart we compare employment vs. unemployment in an effort to get a more complete picture of the employment situation. Normally, you would think that they should simply be the inverse of each other. Flip one over and you have the other. But the U.S. Bureau of Labor Statistics (BLS) actually uses two entirely different surveys to calculate them. And the current chart shows several anomalies in the data. See Current Employment vs. Unemployment Chart.
Created by economist Arthur Okun, the misery index combines two simple data sets that determine how difficult life is for the average citizen but during the 1960’s when it was created the index was actually at historically low levels.
The two factors it uses are inflation and unemployment. High levels of price inflation (rapidly rising prices) will cause households to have difficulty affording the basic necessities while high unemployment will leave a high percentage of households without any income at all. High combined levels will cause havoc throughout the economy and a high level of distress, discomfort and political unrest. See Misery Index.
U3 vs. U6 Unemployment
The Bureau of Labor Statistics (BLS) uses six different measures of unemployment i.e. U-1 through U-6. This chart compares the commonly used U-3 unemployment with the broader U-6 rate. You may notice that when unemployment rises the gap between U-3 and U-6 generally increases. For instance, the difference was only 2.7% in October 2000, when unemployment was at the lowest levels on this chart. At that point, U-3 was 3.6% and U-6 was 6.3%. But at the peak of unemployment in January 2010 U-3 was at 10.6% but U-6 shot all the way up to 18% for a difference of 7.4%. More…
How can the unadjusted unemployment go in one direction while the adjusted unemployment rate go in the other? Seasonal adjustment is a statistical technique which eliminates the influences of weather, holidays, the opening and closing of schools, and other recurring seasonal events from economic time series. This permits easier observation and analysis of cyclical, trend, and other nonseasonal movements in the data. So in theory removing these fluctuations makes the data easier to compare from month to month and in practice it looks somewhat like a moving average smoothing out the peaks and valleys. So let’s look at how seasonally adjusted data compares to unadjusted unemployment data on a chart.
What is the “Real” Unemployment Rate?
Often there is mistrust of government numbers so the Gallup survey people began doing their own survey on unemployment rates back in 2010, in an effort to determine the True Unemployment Rate. We compare their results with the results the BLS publishes in this chart. Thus we see that the Gallup numbers are usually higher than the BLS numbers with the BLS numbers consistently presenting a rosier picture. See: BLS vs. Gallup Unemployment Rates. See Also:
- Monthly Historical Unemployment Rates from 1948 through the present.
Can't find what you are looking for? Search our site below: