September 2012- Real Unemployment Story In Three Charts

October 10, 2012

The  single point in time, monthly headline unemployment rate is a not very useful leading indicator for people in the precision machining business. If anything it confuses people by its jumps and the fact that it indicates both people who found jobs AND people who quit looking in despair.

The following three charts give you a more useful idea about what the unemployment situation in the United States really look like.

14.7% U-6 Total unemployment / underemployment

As we have discussed before, the U-6 rate is the more honest and encompassing indicator of the unemployment situation. It counts the total unemployed plus all marginally attached  workers. (Marginally attached is Economist-speak for “part time employed because I can’t find full-time work that suits me.”

Civilian labor force participation rate- in decline for 12 years

If anyone has anything good to say about what this CIVPART chart indicates, I’d love to hear it. And so would a bunch of recent college graduates  currently unable to pay off their student loans.

While the population grows, the opportunities to work have not. More and more people are increasingly dependent on fewer and fewer people who are employed.

Note: BLS reports that the long term unemployment rate was little changed in September at 4.8 million, accounting for 40.1% of the unemployed.

The one oasis of employment that I know of is in the precision machining industry. Our shops are looking for talented people to operate our computer numerically controlled machine tools. If you can perform high school math and are comfortable with computers, you should consider a career in precision manufacturing.

Check it out here.

BLS LONGTERM

U6RATE

CIVPART

EMRATIO  58.7%, seasonally adjusted.

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