Recently the mainstream press and pundits gushed over the apparently falling unemployment rate. After all, the official unemployment rate fell by 0.2 percentage points to 8.3 percent. Total private job gains were 257,000.
But the numbers can be deceiving; statistics such as those showing the length of average unemployment, the labor force participation rate and civilian employment-population ratio reveal a slightly different picture of the health of the economy.
A chart that offers a fuller context for unemployment is the one below. The chart shows how many people (approximately 15 million) are unemployed, marginally employed and forced to work part time by a lack of full time jobs.
The average length of unemployment is 40 weeks. If we look at what this means in comparison to all the other recessions in the last five decades, we can see in the chart below that we are at historic and unprecedented highs in terms of the average length of unemployment.
The number of civilians unemployed for 27 weeks or more is at nearly 6 million; again a record number. At the height of the 1980 recession, only 3 million were unemployed for 27 weeks or longer.
The statistics above reflect that millions of jobs have been lost. The chart of the total nonfarm jobs below shows that we're still not anywhere near the job levels before the beginning of the recession.
Many workers can't find full time work, as the chart below indicates. Again, these are numbers not seen in a decade.
Aside from historic highs of average length of unemployment, the millions of lost jobs and the fact that a record number of workers can't find anything more than part-time work, another key indicator of the health of the job market is the labor force participation rate. This number has been falling, meaning that more and more people are simply dropping out of the work force.