Sunday, September 20, 2009

Estimating U-6 Labor Underutilization

by the Sandwichman
U-3: Total unemployed, as a percent of the civilian labor force (official unemployment rate).

U-6: Total unemployed, plus all marginally attached workers, plus total employed part time for economic reasons, as a percent of the civilian labor force plus all marginally attached workers.
It turns out that there are some 2008 annual data on part-timers and marginally attached workers that enable the reconstruction of a U-6 for 18-24 year olds. In 2008 there were 1,036,000 16-24 year olds working "part time for economic reasons" and 1,733,000 16-24 year olds "marginally attached" to the labor force. Added to the 2,830,000 officially unemployed, they bring the total of labor force underutilization in 2008 to 5,599,000 for a U6 rate of 24.3%. The U-3 rate for 2008 was 12.8%.

Assuming a constant ratio between U-3 and U-6 over time suggests a current (August 2009) U-6 rate for 16-24 year olds of 34.4%. Alternatively, assuming a constant percentage point margin between the two measures gives 29.6%. A third method, using the ratio of current U-3 to current U-6 for the general population yields an estimate of 31.5%.

1 comment:

daniel said...

I’m just share my views from top to bottom as I see them.
I feel this is a good simply because its consistent with how the user is used to seeing the comment form and filling out information in general. Filling out the name and email wont take me much time, and if you really wanted to go ahead and type the comment first, you can do so, not really that big of a work around.

part time worker