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Before this seven-week stretch of 33.5 million initial jobless claims, there were already 7.1 million unemployed Americans as of March 13. When those figures are combined, it equals more than 40 million unemployed, or a real unemployment rate of 24.9%.

Fortune Magazine, May 7th

Question

Is the unemployment rate 24.9% as of March 2020, including those that quit searching for work?

Oddthinking
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Travis Wells
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    The traditional definition of "unemployment rate" is based on the number of people who are looking for a job but can't find one. This definition is less than useful right now, since many people who have lost their jobs aren't bothering to look -- they know nobody's hiring. – Mark May 08 '20 at 02:40
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    A reminder: [We don't need political snark here.](https://skeptics.meta.stackexchange.com/questions/3858/sorry-but-we-dont-care-about-your-political-opinions) There are plenty of places on the Internet where it is welcomed. – Oddthinking May 08 '20 at 04:37
  • @Mark I disagree that no one is hiring. There are plenty of businesses that need extra workers right now in industries that are unusually stressed (health care, delivery services, grocery stories, cleaning companies, etc). Now, whether people are aware of that, the number of new jobs is >= to the number of displaced jobs or if the people displaced are under/over qualified is another story. – PC Luddite May 08 '20 at 04:58
  • @Mark About time people use the dictionary definition. – Travis Wells May 08 '20 at 05:28
  • @PCLudditte Why would I lose a $20 hour job and look for a $10 hour job? – Travis Wells May 08 '20 at 05:34
  • @PCLuddite From experience, it's really hard for me to even land a job at Walmart or even Burger King. And, I'm a young college student with no criminal history. It took me 4+ months of job seeking. I leave the discussion here unless it's moved to chat. – Travis Wells May 08 '20 at 05:40
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    @TravisWells that is to my second point about the type of jobs available and more or less what I meant when I said "under/over qualified". There are plenty of service jobs available, but they're low paying and often higher risk. Apologies if I sounded insensitive. Obviously raw numbers don't really convey the human element in the overall crisis. – PC Luddite May 08 '20 at 06:03
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    As noted in an answer, "real unmeployment rate" is a technical term. Since it is used in the quote, should it also be used in the title and the question? – GEdgar May 08 '20 at 14:24
  • Does this answer your question? https://www.bbc.com/news/business-52591262?at_custom3=BBC+News&at_medium=custom7&at_custom4=42EF42DC-912C-11EA-9A41-BF6C96E8478F&at_campaign=64&at_custom1=%5Bpost+type%5D&at_custom2=facebook_page&fbclid=IwAR0az_LxDR4Q0eY2wyoZ2Gfokx9sW-Op8SdgHbKczen9czbMApkdgLmNvd4 – DJClayworth May 08 '20 at 14:40
  • @Mark: But for those who have recently lost a job, many are likely eligible for unemployment benefits (particularly since those benefits have been increased), but AFAIK that only applies if they continue to look for a job in some sense. Thus I'd expect that this large group *would* generally be included in the labor force, and hence in the unemployment rate. Am I missing something? – Nate Eldredge May 08 '20 at 15:51
  • @PCLuddite, check the recent archives for any newspaper, and you'll see reports of large-scale layoffs in the health-care industry: people are postponing the routine and elective procedures that make up the bulk of the industry's work. Cleaning companies are also laying people off, because the demand for in-home and in-office cleaning is greatly reduced due to work-at-home requirements. Gig delivery is up, but it's only partially absorbing the losses from Uber and Lyft; large-scale delivery is down (the US Postal Service is on the verge of bankruptcy, for example). – Mark May 08 '20 at 21:10
  • @NateEldredge, in an attempt to reduce unemployment fraud, almost every benefits program has some mechanism to require the job search to be potentially productive -- that you're not just spamming out applications to the first dozen listings in the classifieds. For people in the hospitality industry, that's an impossible standard to meet right now: my local Craigslist, covering a metropolitan area of a half-million people, had 30 job listings posted yesterday, and almost all of them were for skilled trades. – Mark May 08 '20 at 21:29
  • @Mark I'm aware of the news and am not suggesting that industries aren't struggling or people are not being laid off or furloughed. However, jobs exist. They're just not the same jobs, number of jobs or quality of jobs. – PC Luddite May 09 '20 at 04:38
  • @PCLuddite, in a strict sense, yes, jobs exist. But it's hard to say that there are "plenty of businesses" hiring. My local Craigslist, for example, got 30 posts for job openings last Thursday in a metropolitan area of a half-million. Of those, 21 were for skilled positions (CDL, electrician's license, senior/management position, etc.), and two were obvious scams, leaving only seven job openings for people switching industries. Or if you prefer official statistics, the latest job report shows losses or trivial growth (<500 jobs) in every sector except general-merchandise stores. – Mark May 09 '20 at 19:10
  • @Mark Half a million is considered to be a major city. With 30 job listings out of 500,000, that's pitiful. – Travis Wells May 10 '20 at 20:34
  • Note: Joe Biden's website makes the claim [The unemployment rate is higher than it was in the Great Recession.](https://joebiden.com/build-back-better/). – Rebecca J. Stones Jul 21 '20 at 03:46

1 Answers1

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This was a close estimate, but for May not for March. The official term "real unemployment" includes "marginally attached" workers among the unemployed--those who have stopped looking for work in the last 12 months. So if they quit looking for work more than 12 months ago, they're not counted in the labor force. In any event, the current real unemployment rate announced this morning (May 8) is 22.8%.

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Consistent with this, the labor force participation rate has recently been dropping near or below the long-term average of 60.2%.

Brian Z
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    "those that quit searching for work" are sometimes called "discouraged workers" and I think the BLS tracks them too, for a while, but [separately](https://books.google.com/books?id=q5S1uMWg-WUC&pg=PA163&lpg=PA163) from the unemployment figure. But the quoted claim didn't even say these discouraged workers should be included, that was the OP's addition. – Fizz May 08 '20 at 18:00
  • CNN has a bit of a "for dummies" breakdown (of the latest BLS figures, mostly U3 and U6) https://edition.cnn.com/interactive/2020/05/business/april-jobs-report-unemployment-rate/ "people who want a job but haven’t searched in the last 12 months" are an extra 6.9m on top of U6 according to that. – Fizz May 08 '20 at 18:38
  • @Fizz Good point, I missed that right in my own source. Cleaned up my answer a bit accordingly. – Brian Z May 08 '20 at 18:50
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    Frankly, I'm a bit unsure CNN hasn't messed up here https://economics.stackexchange.com/questions/36518/under-what-bls-line-do-people-who-want-a-job-but-haven-t-searched-in-the-last-1 – Fizz May 08 '20 at 18:53
  • Actually the CNN math is correct albeit it wasn't straightforward where the 6.9m figure came from (table A-38 in BLS). – Fizz May 08 '20 at 19:02
  • This is slowly making more sense and I have made more edits, thanks again @Fizz. – Brian Z May 08 '20 at 19:15