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Real U-3 Unemployment Rate: 11.6%

Posted By yihan On May 4, 2012 @ 9:06 am In Money Watch | Comments Disabled

Zero Hedge [1]
Friday, May 4, 2012

Propaganda unemployment rate: 8.1%; Real unemployment rate: 11.6%. Reason for difference: organic growth of labor force which grows alongside the broader population. Don’t be confused by cheap explanations on TV why the labor force should be declining (especially with ZIRP meaning pre-retirement workers have to stay in the labor force ever longer to supplant their meager fixed income): the widely accepted definition of the labor pool, that used by the CBO and all other government forecasting agencies,assumes a 90,000 growth in the labor force every month as it has to keep in line with the growth of the US population! The implication is simple: using a real labor force participation rate long-term average of 65.8%, the real unemployment rate in April was 11.6%, based on the 5.4 million additional workers that should be counted as part of the U-3 which then means that the real number of unemployed is not 12.5 million but 17.9 million, which in turn implies a 11.6% unemployment rate in the US. This also means that the spread between the propaganda, and the real number is now 3.5%: the most it has been since the early 1980s.

Real U 3 Unemployment Rate: 11.6% Real%20Unemployment%20Rate 0 [2]


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URLs in this post:

[1] Zero Hedge: http://www.zerohedge.com/news/real-u-3-unemployment-rate-116

[2] Image: http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2012/05/Real%20Unemployment%20Rate.jpg

[3] Labor Force Participation Rate Drops To Fresh 25 Year Low, Adjusted Unemployment Rate At 11.7%: http://www.prisonplanet.com/labor-force-participation-rate-drops-to-fresh-25-year-low-adjusted-unemployment-rate-at-11-7.html

[4] Persons Not In Labor Force Who Want Job Now Jumps To All Time Record; Real Unemployment Rate At 12.8%: http://www.prisonplanet.com/persons-not-in-labor-force-who-want-job-now-jumps-to-all-time-record-real-unemployment-rate-at-12-8.html

[5] Real Unemployment Rate 14.6 Percent in October: http://www.prisonplanet.com/real-unemployment-rate-14-6-percent-in-october.html

[6] Real US unemployment rate at 16 pct: Fed official: http://www.prisonplanet.com/real-us-unemployment-rate-at-16-pct-fed-official.html

[7] The “Real” Unemployment Rate Jumps To 17.1%: http://www.prisonplanet.com/the-real-unemployment-rate-jumps-to-17-1.html

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