Federal Reserve Economic Data

How many people are unemployed? Before answering this question, you need to define unemployment. The Bureau of Labor Statistics offers six definitions, conveniently labeled U-1 through U-6, that are increasingly inclusive. What they have in common is they measure some aspect of labor underutilization. U-1 counts only those who have been unemployed for at least 15 weeks, which is usually (but not lately) a little longer than the average duration of an unemployment spell. Hence, this excludes short-term unemployment. U-2 uses a somewhat different concept: the percentage of those who are unemployed because they have lost a job or completed a temporary job. Some of them may be included in U-1. So U-2 counts workers in a precarious situation in the labor market, as they are more likely to find an unstable or unsatisfying job. U-3 is the traditionally reported unemployment rate, which counts people who are able to work, ready to work, and have looked for work in the past four weeks. U-4 takes U-3 and adds those who would like to work but have stopped looking—the so-called discouraged workers—because they believe there are no jobs for them. U-5 takes U-4 and adds those who are marginally attached to the labor market: those who, for any reason, are no longer searching for work. Finally, U-6 includes all of the above plus those who are working part-time but would prefer to work full-time.

How this graph was created: Go to the Alternative measures of labor underutilization release table (A-15) from the Bureau of Labor Statistics’ Employment Situation release. Select all (seasonally adjusted) series and click “Add to Graph.”

Suggested by Christian Zimmermann