Unemployment
I'm just wondering at what point do the unemployment numbers become a real problem.
It now stands at 7.2%, which is the worst it's been since I've been an adult. It's also got to be at least 2% worst than this time last year. Correction, it's 2.3% worst than one year ago.
And if I understand the situation correctly, underemployment (you have a job but you'd prefer one that's full-time instead of 32- hours a week) has risen about as much as unemployment. That means perhaps 5% of the country is earning less (sometimes far less) than they did at the same time last year.
All that said, 7% unemployment is not bad by most historical standards (5% is often considered to be a fundamental base level caused by job transitions/turnover rather than people being out of work for prolonged times). I'm more concerned what happens when these numbers get high enough that they really start amplifying recessionary trends we are already experiencing. Foreclosures were high this summer, but unemployment was under 6% then. What happens when unemployment hits 8%+ this summer?
Tim, you might consider linking to that Bureau of Labor Statistics chart I pointed to on the main page or something. In 2008, the unemployment statistics didn't really matter that much, but 2009 looks like a different story.
It now stands at 7.2%, which is the worst it's been since I've been an adult. It's also got to be at least 2% worst than this time last year. Correction, it's 2.3% worst than one year ago.
And if I understand the situation correctly, underemployment (you have a job but you'd prefer one that's full-time instead of 32- hours a week) has risen about as much as unemployment. That means perhaps 5% of the country is earning less (sometimes far less) than they did at the same time last year.
All that said, 7% unemployment is not bad by most historical standards (5% is often considered to be a fundamental base level caused by job transitions/turnover rather than people being out of work for prolonged times). I'm more concerned what happens when these numbers get high enough that they really start amplifying recessionary trends we are already experiencing. Foreclosures were high this summer, but unemployment was under 6% then. What happens when unemployment hits 8%+ this summer?
Tim, you might consider linking to that Bureau of Labor Statistics chart I pointed to on the main page or something. In 2008, the unemployment statistics didn't really matter that much, but 2009 looks like a different story.
Comments
I suppose it depends on how you measure unemployment. Shadowstats has it near 18%. U6, the broadest measure of unemployment, has it closer to 14%. Plus the data just came out and has a long history of being consistently revised upward, so U3 (Official inflation) may already be at 9%.
Realistically, we're already to the point where unemployment is having a visible effect on the economy. Retail sales didn't plummet just because credit was pulled out. Some of that was people losing their jobs, or holding off on purchases since most companies are talking about layoffs.
The scary thing is, the local big names haven't really even begun to layoff yet. Boeing is supposed to announce sometime around the beginning of February, and rumors are still flying around MS.
Also, rose, underemployment is not generally used to describe less-than-40 hour work weeks. For most purposes that's simply considered a part-time job, which counts the same as a full-time job for unemployment calculations even if the worker is making vastly less money.
Where underemployment is more typically used is for people working a job outside their field of expertise, typically at a lower wage. I know a fair number of automotive engineers who are working part/full-time jobs doing odds and ends. The statistics show them as employed, but they're making a fraction of their engineering salary. Underemployment also covers seasonal workers.
Improved that for you.