Alternative measures of unemployment

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Besides the official unemployment rate that is the topic of news each month, the Bureau of Labor Statistics (part of the U.S. Department of Labor) tracks and publishes five other series. These are called alternative measures of labor underutilization.

BLS defines the six measures as follows, along with the seasonally adjusted value for February 2014:

  • U-1, persons unemployed 15 weeks or longer, as a percent of the civilian labor force, 3.5%
  • U-2, job losers and persons who completed temporary jobs, as a percent of the civilian labor force, 3.5%
  • U-3, total unemployed, as a percent of the civilian labor force (this is the definition used for the official unemployment rate), 6.7%
  • U-4, total unemployed plus discouraged workers, as a percent of the civilian labor force plus discouraged workers, 7.2%
  • U-5, total unemployed, plus discouraged workers, plus all other marginally attached workers, as a percent of the civilian labor force plus all marginally attached workers, 8.1%
  • U-6, total unemployed, plus all marginally attached workers, plus total employed part time for economic reasons, as a percent of the civilian labor force plus all marginally attached workers, 12.6%

As the above definitions indicate, U-3 is the “official” or most often mentioned unemployment rate. Those who fit the profile of U-4, U-5, or U-6 are called “discouraged workers.” In particular, those in category U-6 are called “involuntary part-time workers.” The rate for this category, 12.6 percent, is 1.88 times the level of U-3, the official unemployment rate.

Alternative measures of unemployment in the United States, from Bureau of Labor Statistics
Alternative measures of unemployment in the United States, from Bureau of Labor Statistics

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