When we hear what the unemployment rate is we only hear about those whom have been actively looking for the last 4 weeks. This does not included those who have settled in underemployment, gave up, looking for more hours etc. This is referred to as the U3 unemployment rate. The rate we should actually be concerned with is the U6 rate.
According to the Department of Labor:
The U6 unemployment rate counts not only people without work seeking full-time employment (the more familiar U-3 rate), but also counts “marginally attached workers and those working part-time for economic reasons.” Note that some of these part-time workers counted as employed by U-3 could be working as little as an hour a week. And the “marginally attached workers” include those who have gotten discouraged and stopped looking, but still want to work. The age considered for this calculation is 16 years and over.
The Bureau of Labor Statistics measures employment and unemployment (of those over 16 years of age) using two different labor force surveys conducted by the United States Census Bureau (within the United States Department of Commerce) and/or the Bureau of Labor Statistics (within the United States Department of Labor) that gather employment statistics monthly. The Current Population Survey (CPS), or “Household Survey”, conducts a survey based on a sample of 60,000 households. This Survey measures the unemployment rate based on the ILO definition. The data are also used to calculate 5 alternate measures of unemployment as a percentage of the labor force based on different definitions noted as U1 through U6:
U1 : Percentage of labor force unemployed 15 weeks or longer.
U2 : Percentage of labor force who lost jobs or completed temporary work.
U3 : Official unemployment rate per ILO definition.
U4 : U3 + “discouraged workers”, or those who have stopped looking for work because current economic conditions make them believe that no work
is available for them.
U5 : U4 + other “marginally attached workers”, or “loosely attached workers”, or those who “would like” and are able to work, but have not looked for
work recently.
U6 : U5 + Part time workers who want to work full time, but cannot due to economic reasons.
I believe that this is the rate we should be looking at; in January 2000 the U6 rate was 7.1. Since June 2008 the rate has not been below 10% the highest was 17.3% in December 2008.
These are very scary numbers, especially for those 50 and older. These are the people who have been expressing to me their concerns about ever finding another full time job.