Alternative Measures of Unemployment: U-6

The BLS data series that gets most of the press is the headline unemployment rate, or U-3 (seasonally adjusted). With the structural changes in the economy which would seem to result in undercounting issues in how U-3 is calculated, many folks have started giving U-6 some attention(U-6 casts the net very broadly, in particular folks who are involuntarily part time).

This plot is based on U-6 unadjusted, the year over year percent change in the value - so if the value in July, 2007 was 5% and then the value in July, 2008 was 6% this would be a 20% increase on this plot - declines in the unemployment rate would be a negative value. On a rate of change basis, we are where we were at around September, 2001 only with a U-6 value that is 10.8%(7/2008) instead of 8.2%(9/2001). The Federal Funds rate in 9/2001 started the month at 3.5%, ended the month at 3% on the way to 1%...

Riddle me this...

I have links below to source the material but here is one that might have kept the Sphinx whole...

The nominal GDP growth for 1Q2008 was $119.6 billion, represented as a real annualized GDP growth rate of 0.9%.

The nominal growth for 2Q2008 was $105.7 billion, represented as a real annualized GDP growth rate of 1.9%.

A nominal decline QoQ of 11.6% is equal to a real annualized QoQ increase in rate of 111% - that is some change in deflator kids! Can anyone clearly define what state change occurred to make that kind of change in the deflator? Anyone? Buehler?


http://www.bea.gov/newsreleases/national/gdp/gdpnewsrelease.htm
GROSS DOMESTIC PRODUCT: Second Quarter 2008 (Advance)
[snip]
Current-dollar GDP
Current-dollar GDP -- the market value of the nation's output of goods and services -- increased 3.0 percent, or $105.7 billion, in the second quarter to a level of $14,256.5 billion. In the first quarter,current-dollar GDP increased 3.5 percent, or $119.6 billion.
[snip]

http://www.bea.gov/newsreleases/national/gdp/2008/tech208a.htm
Technical Note Gross Domestic Product, Second Quarter of 2008 (Advance), July 31, 2008
[snip]
Real GDP
Real GDP increased 1.9 percent (annual rate) in the second quarter (that is, fromthe first quarter to the second), following an increase of 0.9 percent (revised) inthe first quarter.
[snip]

Real Estate Loan Delinquency Rates - CHGDEL update on rate of change

This is another bit of Fed data, though this is from the main FRB web site. This update is looking at the rate of change of the percent of real estate loans that are delinquent on a year over year basis...so if we go from 2% to 4% YoY that would be a 100% rate of change.

What we see is continued acceleration from the very low base we started from - the question is once this has been underway for awhile when will it start to slow down? If we get to 6% and a year later the rate is 9% that would be 50% on the plot, the rate of delinquency won't actually be improving until the line goes under the 0% baseline.

The Employment Spread Trade - CIVPART - EMRATIO update

What has happened in the last quarter is a continuation of the trend of a wider spread between the civilian participation rate (CIVPART from FRED) and the employed ratio of the population (EMRATIO again courtesy of FRED).



I am curious if there is a secular change in the works, as the spread since about 1980 has bottomed at a lower point in each expansion until the latest one...maybe related to the reduction in labor force participation by women that is occuring (no value judgement there, just the observation).

Modern American Patriots!

This video of citizens in action is downright INSPIRING!http://www.youtube.com/watch?v=EUpQ_EJMdGs

Local Minima in the CIVPART-EMRATIO Spread (with thanks to the St Louis Fed -I like FRED!)

Here is another look at yet more data suggesting that we are indeed entering a recession - just in case the most recent new claims report has you questioning whether that is the case or no - I welcome speculation on the explanatory side of this...

I got to fiddling around with data series from FRED, the St Louis Fed online data source and got curious about the spread between the CIVPART series, which is the labor participation rate, and the EMRATIO series, which is the employed as a percent of the population. I eyeballed the recession bands and layered them in, I need to learn how my infoporn hero CR does his recession bands... in any case, it seems whenever this spread is coming off of a local minima we are going into a recession, period. How much and how long... quien sabe?

One more unnecessary recession indicator post

Well today we had the third job loss month in a row, with some material revisions to the previous two months numbers - downward - which got me curious about the FRED plots from the St Louis Fed...

Here is the USPRIV, which is from the same source and plots the total of all private sector employees % change year over year:


Here is the UNEMPLOY series plot of the % change over year ago - we have just breached a level that appears to be associated with recessions when coming from a bottom in the unemployment rate - there is one time we reached it back in the late '60s without a breach that did not result in a recession...take a look and draw your own conclusions.

Seems to me the question now, as so many others have also posed is which mix of short/long and shallow/deep are we going to have with this recession? Talk amongst yourselves.