Unemployment Measures

When the Bureau of Labor Statistics (BLS) issues their monthly labor report, the headlines quote an unemployment rate and the number of jobs gained in the past month.  In addition to those headline numbers, a newspaper article may cite a Civilian Participation Rate, the number of long term unemployed, discouraged workers, etc.  To the casual reader, all of these numbers swirl around, making it difficult to see a clear picture.  Below is a pie chart breaking down the approximately 313 million people of the U.S. into various segments. (Click to enlarge in separate tab)

When you read about the Civilian Non-Institutional Population, it is all the people in the country except for those who are under 16, in the Armed Forces, a nursing home or prison.   A better term might be “non-restricted”, i.e. those who are, by definition, free to choose whether they want a job or not.  “Persons not in the labor force combined with those in the civilian labor force constitute the civilian noninstitutional population 16 years and over. (There is no upper age limit.)”  (BLS Source )

This population number becomes the divisor (the bottom number of a fraction) for the Civilian Employment Population Ratio (EMRATIO), which calculates the percentage of employed people to the Non-Institutional Population.

When you read “Civilian Labor Force” that means “”The sum of the employed and the unemployed constitutes the civilian labor force” (BLS Source)

When you read about the unemployment rate, this is the U-3 employment rate.

Sometimes you will read about the “true” or “real” unemployment rate, although often the speaker or author can not define what is “true” or “real”, showing a lack of knowledge about the various employment rates.  What they are usually referring to is the U-6 unemployment rate, which includes discouraged workers and those who are working part time because they either can not find a full time job or business is slow and their hours are reduced.

A casual reader of American History will remember the WPA, a government project that put up to three million people to work during the 1930s.  Projects included the Hoover Dam, Grand Coulee Dam, the Lincoln Tunnel linking Manhattan and New Jersey, Carlsbad Caverns, the Great Smoky Mountains National Park and public buildings throughout the U.S.  But who knew that a large part of the unemployment report itself was a WPA project begun in 1940? (BLS Source)

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