Augmented Unemployment Rate
From Barry Ritholtz at the Big Picture, a note on the "augmented unemployment rate" that shows a decline to about 8.5%. Here is some info about this number, according to Barry:
So what good does this statistic do us? If anything, it seems like it was more out of whack back then. And as I recall, back in 1996, the only concern was that the unemployment rate was getting too low. Greenspan kept watching the Employment Cost Index looking for inflation which never really arrived. If this means that unemployment is roughly equivalent to late 1996, then things aren't really that bad now.
Even using the widest measure of unemployment that BLS has, the U-6 which equals: "Total unemployed, plus all marginally attached workers plus total employed part time for economic reasons, as a percent of all civilian labor force plus all marginally attached workers", it is still roughly equivalent to where we were back in the 1996 time frame.
From Barry Ritholtz at the Big Picture, a note on the "augmented unemployment rate" that shows a decline to about 8.5%. Here is some info about this number, according to Barry:
"The Augmented Unemployment Rate includes the discouraged, the underemployed, the part timers. For anyone concerned with the macro impact of the labor pool as consumers, this number is for you. It also provides a more accurate detail as to the health of the Job market."Reporting on these statistics seems like this seem to be a bit of a reach for me, like trying to find the bad in an otherwise pretty good unemployment number. I can understand having a statistic that incorporates this type of data, but why now? Just eyeballing Barry's graph, it looks to me that where we are now is equivalent to mid to late 1996. And if you look at mid to late 1996, the unemployment rate was between 5.1 - 5.5%.
So what good does this statistic do us? If anything, it seems like it was more out of whack back then. And as I recall, back in 1996, the only concern was that the unemployment rate was getting too low. Greenspan kept watching the Employment Cost Index looking for inflation which never really arrived. If this means that unemployment is roughly equivalent to late 1996, then things aren't really that bad now.
Even using the widest measure of unemployment that BLS has, the U-6 which equals: "Total unemployed, plus all marginally attached workers plus total employed part time for economic reasons, as a percent of all civilian labor force plus all marginally attached workers", it is still roughly equivalent to where we were back in the 1996 time frame.
