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  • Unemployment Rate Dips in May

    The unemployment rate edged down slightly last month. With employment growing by 431,000, the unemployment rate went from 9.9% in April to 9.7% in May, according to data released by The Department of Labor this morning. Not startling changes, but it the figures do present a better employment picture than a year ago. Here's a look at the unemployment rate and payroll employment from the Bureau of Labor Statistics : Here's the latest on two areas we have been trying to track--marginally attached, and discouraged workers: About 2.2 million persons were marginally attached to the labor force in May, unchanged from a year earlier. (The data are not seasonally adjusted.) These individuals were not in the labor force, wanted and were available for work, and had looked for a job sometime in the prior 12 months. They were not counted as unemployed because they had not searched for work in the 4 weeks preceding the survey. Among the marginally attached, there were 1.1 million discouraged workers in May, up by 291,000 from a year earlier. (The data are not seasonally adjusted.) Discouraged workers are persons not currently looking for work because they believe no jobs are available for them. The remaining 1.1 million persons marginally attached to the labor force had not searched for work in the 4 weeks preceding the survey for reasons such as school attendance or family responsibilities. Read the BLS report here . And though it came out before the latest unemployment figures, Motoko Rich had an interesting and relevant article in the New York Times about how the actual employment picture may be rosier than the statistics are showing. Rich profiles several people who have recently worked to enter the labor force again, after giving up some months ago. Read A Jobless Rate Still Unaffected by New Hiring here .

  • More Jobs in April, But Unemployment Rate Rises to 9.9%

    The number of jobs went up by 290,000 last month. But the unemployment rate also rose, according to data released by The Department of Labor this morning. The unemployment rate had been at 9.7% from January through March, but is now at 9.9%: Here's the latest on marginally attached, and discouraged workers: About 2.4 million persons were marginally attached to the labor force in April, compared with 2.1 million a year earlier. (The data are not seasonally adjusted.) These individuals were not in the labor force, wanted and were available for work, and had looked for a job sometime in the prior 12 months. They were not counted as unemployed because they had not searched for work in the 4 weeks preceding the survey. (See table A-16.) Among the marginally attached, there were 1.2 million discouraged workers in April, up by 457,000 from a year earlier. (The data are not seasonally adjusted.) Discouraged workers are persons not currently looking for work because they believe no jobs are available for them. The remaining 1.2 million persons marginally attached to the labor force had not searched for work in the 4 weeks preceding the survey for reasons such as school attendance or family responsibilities. Read the BLS report here .

  • Unemployment Benefits and Unemployment Duration

    Not only do more people lose their jobs during a recession, but the duration of unemployment also always increases, according to Rob Valletta and Katherine Kuang of the San Francisco Fed . The number of Americans unemployed for six months or longer reached an all-time high last year. And Valletta and Kuang have analyzed whether the availability of unemployment insurance has a significant impact on how long people remain unemployed. For our specific test, we look at the increase in unemployment duration observed as the UI extensions were introduced and renewed in 2008 and 2009. We use the "expected unemployment duration" concept from Valletta (2005), which yields a monthly measure of the typical completed duration of unemployment for an individual who becomes unemployed in a particular month, based on the distribution of individual unemployment spells for the current and prior months. This measure more accurately reflects the overall duration of unemployment spells and changes in duration over time than do the average and median duration series published by the BLS, which are tallied from incomplete spells measured at the time each survey is conducted. Figure 2 Unemployment duration by reason (through December 2009, three-month moving average) Note: Authors' calculations from CPS microdata (seasonally adjusted). The solid vertical line indicates the recession start; the dashed lines indicate effective dates for UI extensions (through 12/09). Figure 2 displays the resulting unemployment duration series for job losers and leavers/entrants from 2005 through the end of 2009. The vertical lines identify the start of the recession and the dates for the initiation and renewal of the extended UI benefits programs. Unemployment duration rose slightly in the early phase of the recession and then increased sharply after extended UI benefits became available, reaching a high of about 35 weeks in mid-2009 before declining back to about 30 weeks by the end of the year. Notably, the increase in expected duration was similar for job losers, the group that is eligible for UI benefits, and leavers and entrants, who are ineligible. The similar increase in duration for the UI eligible and ineligible groups suggests that extended UI had only a limited impact on unemployment duration. As of the fourth quarter of 2009, the expected duration of unemployment had risen about 18.7 weeks for job losers and about 17.1 weeks for leavers and entrants, using the years 2006-2007 as a baseline. The differential increase of 1.6 weeks for job losers is the presumed impact of extended UI benefits on unemployment duration. It is straightforward to translate this increase in unemployment duration into an effect on the unemployment rate, based on their proportional relationship and adjusted for the share of job losers in overall unemployment, which was about 67% in December 2009. The implied increase in the unemployment rate is quite small, slightly less than 0.4 percentage point, indicating that without UI extensions, the measured unemployment rate would have been 9.6% in December 2009 rather than the observed 10.0%. Read Extended Unemployment and UI Benefits here .

  • A Good Friday Jobs Report

    There are still roughly 15.0 million unemployed Americans. The jobless rate remains at 9.7%. The number of discouraged workers--Americans who have stopped looking for work because they believe there are no jobs--is still climbing and has now reached 1.0 million. And the number of marginally attached workers--still looking for work but not counted among the unemployed because they did not search for a job in the past month--is now up to 2.3 million. And yet, for people looking for good news, any good news, on the jobs front, March was a good month. Take a look at the far right of the below charts: Today's report from the Labor Department showed that the US Economy gained 167,000 jobs last month. Not a lot, but a positive turn nonetheless. Read the jobs report from the Bureau of Labor Statistics here .

  • Unemployment Holds at 10%

    The Department of Labor released its first jobs report of the year this morning, and the December figures show the number of unemployed down 85,000 for the month and the rate of unemployment holding at 10.0%. The number of Americans unemployed for 27 weeks or longer-- long term unemployed --rose to 6.1 million in the month, according to the Bureau of Labor Statistics . And an additional 2.5 million Americans are now marginally attached to the labor force --they had not searched for work in the previous four weeks and do not count in the overall unemployment numbers . That's up from 578,000 in December, 2008. Read the BLS report here .

  • 'Surprising Drop' in Unemployment

    The Department of Labor has released the unemployment numbers for November, and the top-line data shows a "surprising drop" in unemployment, as the AP put it . The total number of unemployed dropped slightly to 15.4 million, and the unemployment rate is now at 10.0 percent (charts from the Bureau of Labor Statistics): If the slight drop in the unemployment rate is good news, some of the internal data remains grim. 5.9 million of the 15.4 million unemployed are "long term unemployed"--that is, they have been out of work for at least 27 weeks. That's up 293,000 over October's statistics. And the number of marginally attached workers is now at 2.3 million. Marginally attached workers are people who had looked for work in the last year, but not in the last 4 weeks. They are not counted in the unemployment rate. And 861,000 of the marginally attached workers qualify as "discouraged workers"--individuals who are not currently looking for work because they don't believe there are any jobs. Read the report from the Bureau of Labor Statistics here .

  • Growing Percentage of Americans Unemployed for 27 Weeks or Longer

    The scariest graph of the Halloween weekend came from Mark Thoma at Economist's View : Please share your thoughts on the striking percentage of long-term-unemployed Americans and what it means for the economy going forward by clicking on comments .

  • Cleveland Fed Paper Looks at Employment Inflow and Outflow Rates

    We know unemployment continues to rise. We don't know whether the rate of unemployed workers is going up because more and more people are losing their jobs, or because those out of work are staying out of work longer. Murat Tasci and Kyle Fee of the Cleveland Fed wanted to know whether it matters: This distinction could be important because each of these causes could result in a different set of problems for the labor force. Long-term unemployment, for example, might lead to a deterioration in workers’ general or occupation-specific skills, which would reduce their productivity if they ever do find jobs. An economy in which 10 percent of the labor force was unemployed for three months and 90 percent was unemployed for one month would have the same unemployment rate as one in which 10 percent of the labor force was permanently unemployed all year round, but the implications for human capital would be quite different in each scenario. To understand how much each of these factors contributes to a rise in the unemployment rate, we looked at inflows into unemployment (job separation rate) and outflows from the unemployment pool (job finding rate) for all postwar recessions. In general, we found that as the economy enters a downturn, separations start rising and unemployment durations start getting longer (job findings decrease). After some adjustment in terms of employment by firms, separations usually start to fall before the unemployment rate peaks. What accounts for most of the subsequent rise in the unemployment rate is the longer unemployment durations of those who are still unemployed. Once the economy finally starts recovering, durations get shorter as firms create new jobs and absorb some of the unemployed. Read The Incidence and Duration of Unemployment over the Business Cycle here .

  • Unemployment at 9.7%

    The US moved closer to an official unemployment rate in double figures last month. The Department of Labor announced this morning that another 466,000 jobs were lost in August, bringing the unemployment rate to 9.7%. Here's a look at the two-year trend, from the Bureau of Labor Statistics : The unemployment rate for adult men passed the double digit mark last month, and now is at 10.1%. And the negative trend in discouraged and marginally-attached workers continued. From the BLS release: About 2.3 million persons were marginally attached to the labor force in August, reflecting an increase of 630,000 from a year earlier. (The data are not seasonally adjusted.) These individuals were not in the labor force, wanted and were available for work, and had looked for a job sometime in the prior 12 months. They were not counted as unemployed because they had not searched for work in the 4 weeks preceding the survey. Among the marginally attached, the number of discouraged workers in August (758,000) has nearly doubled over the past 12 months. (The data are not seasonally adjusted.) Discouraged workers are persons not currently looking for work because they believe no jobs are available for them. The other 1.5 million persons marginally attached to the labor force in August had not searched for work in the 4 weeks preceding the survey for reasons such as school attendance or family responsibilities. So if recovery is indeed beginning, it is clear that it is a jobless one. Read the report here .

  • Inside the Employment Numbers

    The Labor Department released monthly unemployment numbers this morning, and there seem to be some good signs for the economy. The headline: nonfarm payrolls declined by 247,000 in July. That's the smallest drop in 11 months. Unemployment held steady at 9.4%. Not a pretty number, but at least for the moment, the leveling off shown below is welcome for the economy: This does not mean an end to the threat of 10% or greater unemployment, as the Wall Street Journal 's Brian Blackstone writes: Despite the surprising dip in the unemployment rate, a double-digit rate is still possible in the next few months. Not only does the economy have to stop contracting to add jobs, it needs to grow around 2.5% consistently just to keep up with new entrants into the labor force. Even if the economy does expand in the 3% range this quarter, as some economists expect, few expect that type of growth to be sustained given the headwinds consumers still face from stagnant incomes and lost housing wealth. Looking inside the numbers, there are some negative figures that continue to haunt. The number of marginally attached workers is now at 2.3 million, and the number of long-term unemployed--out of work for 27 weeks or more--is now at 5.0 million. But there is are some details that could represent more positive news to come. Average hourly earnings are up 3 pennies--to $18.56. And the average workweek grew 0.1 hour. A tiny figure, to be sure, but it is the first rise in that statistic since last August. If employers are increasing hours, that could be a sign that they are more confident moving forward. Read the Bureau of Labor Statistics release on the job numbers here .

  • June Jobless Numbers: Unemployment now 9.5%

    The national unemployment rate is now up to 9.5%. The Labor Department reported job loss statistics for June this morning. Monthly job losses totaled 467,000. That's a siginficant improvement from earlier this year, when monthly job losses neared 700,000, but it is much higher than most economists expected--the DowJones Newswire Survey of economists predicted 350,000 jobs shed during the month . All told, as the Wall Street Journal points out, the economy has lost 6.5 million jobs since the start of the recession at the end of 2007. The health care sector saw an increase of 21,000 jobs, but otherwise losses last month were spread across just about every other sector: Employment in manufacturing fell by 136,000 over the month and has declined by 1.9 million during the recession. Within the durable goods industry, motor vehicles and parts (-27,000), fabricated metal products (-18,000), computer and electronic products (-16,000), and machinery (-14,000) continued to lose jobs in June. Since the recession began, employment in motor vehicles and parts has declined by 335,000, or about one-third. In June, employment in construction fell by 79,000, with losses spread throughout the industry. Since the start of the recession, construction employment has fallen by 1.3 million. Mining employment fell by 8,000 in June, about in line with the average monthly decline since its recent peak in October 2008. Employment in the professional and business services industry declined by 118,000 in June. This industry has shed 1.5 million jobs since an employment peak in December 2007. Within this sector, employment in temporary help services fell by 38,000 in June; this industry has lost 848,000 jobs since the start of the recession. The number of Americans classified as "marginally attached to the labor force," or "long term unemployed" continues to rise as well. 2.2 million Americans are now marginally attached to the labor force, and 4.4 million qualify as long term unemployed. And Planet Money pulls out another negative statistic: As of June, the average job search was clocking in at 24.5 weeks . That's compared to 22.5 in May. So we have almost the same rate of joblessness, but it's taking longer to replace a job that's been lost. Read the Bureau of Labor Statistics release on the jobs data here .