Many media outlets cite the official unemployment rate—the Bureau of Labor Statistics’ U-3 unemployment rate—when reporting on the recovery in the jobs market. This rate stood at 5.0 percent in December 2007 (the first month of the recession) and rose to a high of 10.0 percent in October 2009; it has since fallen to 5.5 percent. Relative to its peak, the unemployment rate has made up 90 percent of the ground lost between December 2007 and October 2009. However, there are good reasons to think that the unemployment rate overstates the degree of recovery in the job market. We are presenting a series of five measures that provide insights on employment and unemployment that aren’t captured by the official unemployment rate. One such measure is discussed here.
Long-Term Unemployment as a Percentage of Total Unemployment
Long-term unemployment as a percentage of total unemployment shows us the share of unemployed Americans who have been out-of-work for 27 weeks or more.
Quantitative measures of the jobs market like the official unemployment rate and the employment-to-population ratio (EPOP) are useful ways of understanding changes in the rates of unemployment and employment, respectively. But even if those measures are completely accurate, they do not tell us much about what it is like to experience unemployment. Long-term unemployment—unemployment lasting 27 weeks or more—increased as a percentage of total unemployment during the recession and has yet to recover. Together with our measure on involuntary part-time employment, this measure of long-term unemployment gives us more evidence that purely quantitative measures of the labor market overstate the degree of recovery in the jobs market.
Employment Recovery Watch
- December 2007 Long-Term Unemployment Percentage: 17.4 percent
- Peak: In April 2010, long-term unemployment peaked at of 45.5 percent of all unemployment.
- February 2015 Long-Term Unemployment Percentage: 31.1 percent
- Percent Recovered: 51.2 percent