[ale] Off topic - And now, unemployment

[Robert Reese]

Hello Sparr,

Sunday, July 11, 2010, 11:55:00 PM, you wrote:
> http://en.wikipedia.org/wiki/Unemployment#United_States_Bureau_of_Labor_Statistics

> http://www.bls.gov/news.release/empsit.t15.htm

> U3 is the official "unemployment rate", around 10%. U6 is the
> statistic that actually matters to those of us who need a job, and is
> around 17% right now.


Good catch and links, Sparr.  That's pretty much what I was taught so long ago in Macroeconomics... wikipedia proved useful this time. :)

The only issues I have are the percentages BLM has for their U4, U5, and U6 figures: they are (in my experience, research, and not-so-humble opinion) wild- at ss guesses and grossly underestimated - especially U5 and U6.  BLM does try to accommodate discouraged (not 'disgruntled' - mea culpa) workers and underemployed workers, among others, but the definitions they use are narrow yet vague.  When probed deeply, it becomes quickly apparent that the BLM has neither the resources nor the technical ability to accurately gauge these numbers and leads them to guesstimate.  U3 is the last number that can be estimated to an acceptable degree of accuracy (as measured by most people) and is the number the media uses each night, as you pointed out.  That is, U4, U5, and U6 get progressively more difficult to quantify or measure, and thus progressively erroneous.

Simply, the government does try to figure out the true unemployment, but they just aren't capable of doing it well enough.

Thanks for the useful links; the wikipedia article does a great job of explaining, correcting, and, of course, expanding on what I wrote.

Cheers,
Robert~