U6 is the broadest measure of unemployment in the civilian labor force in the U.S. economy and includes those who need work but have given up the search, and those who have taken part-time jobs while still seeking full time employment. In February, that figure rose by 0.6% to 16.0%. The seasonally-adjusted U3 figure is the one typically reported in the media and does not include those who have given up and those who have been forced into part-time work.
This morning, it was announced that payrolls shrank by 651,000 jobs and that unemployment (the U3 figure) had risen to 8.1%. But this data is a curious mish-mash of data from two separate surveys. The job loss figure is generated by the “Current Employment Statistics” (CES) program, a survey of 150,000 businesses and government agencies. But the 8.1% unemployment figure comes from the “Current Population Survey,” a monthly survey of households, conducted by the Census Bureau.
The latter survey shows that the ranks of the unemployed grew by 851,000 in February, with the number of jobs shrinking by 351,000 while the work force grew by 498,000. (I can’t explain why there’s a discrepancy of 2,000. Perhaps a matter of rounding.) Normal labor force growth is about 150,000 per month, so nearly 350,000 people who were on the sidelines jumped back into the job market in February. (See http://www.bls.gov/cps/ for more info.)
And yesterday it was reported that, once again, the number of weekly first-time unemployment claims in the previous week was about 650,000, a rate that’s held steady for weeks now. That’s an annual rate of approximately 24%, or one out of every four workers, losing their job.
These are truly horrible numbers. One of my 2009 predictions, made back in November of last year, was that unemployment would top 10% this year. At the time, no economist was predicting such high numbers, and few are today. But with unemployment rising by 0.5% per month, it would only take four more months of such data to get there. It’s beginning to look like a sure thing to me. President Obama had better do something about the trade deficit fast.