Patrick has already provided a good summary of the job report this morning: The situation isn’t good. I would add one more thing: A broader measure of unemployment reveals that the job market is worse shape than the official unemployment rate suggests.
I have mentioned in the past the most commonly reported unemployment rate – which now stands at 6.7 percent — is a very imperfect measure of the health of the labor market. It’s the number of people without jobs who are available to work and are actively seeking work in the four weeks preceding the survey as a percentage of the labor force (the sum of people in the economy who have a job or want one), but it doesn’t tell you anything about the people who have given up looking for work and the people who are employed but only on a part-time basis (i.e., underemployed).
Taking these factors under consideration, a better measurement of the health of our labor market is the U6 unemployment rate, which provides the broadest picture of the current labor situation. According to the new BLS data, the U-6 number now stands at 13.1 percent. It is nearly twice the official unemployment rate. As you can see here, it has slightly declined since the onset of the recession (and it stood at 13.2 percent in November) but is still significantly higher than pre-recession range of 8 percent to 9.3 percent from 2005 to 2007.
My colleague Jason Fichtner and I have updated our chart that looks at the different measures of unemployment. Here it is: