5/2/12

The truth about unemployment

Click to edit Master subtitle style MONEY GAME BUSINESS INSIDER

There are 154 million workers in the U.S.

148% increase over past 60 years Inflation adjusted-GDP has grown 510% to $13T over same period Total population has grown 102% over same period

Sources: BLS, BEA and Census Oct. 2011 Data

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The unemployment rate was 9.0% in October 2011

7.4% of those not counted in labor force, want a job now Congressional Budget Office predicts 8.9% rate at year end CBO forecasts 5.3% and 5.2% unemployment rates five- and ten-years out, respectively

Source: St. Louis Federal Reserve

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9% unemployment equates to roughly 14 million Americans

The number of jobless Americans has remained above 13.5 million even after the recession officially ended in 2009

Source: St. Louis Federal Reserve

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The decline in employment is unprecedented in recent recessions

8.4 million jobs were lost following the 2008 recession 65% of companies polled by McKinsey reduced head count to maintain profits over the past three years 24% of those firms offshored work to cut expenses

Source: McKinsey & Co., Bureau of Labor Statistics

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Education remains a key determiner of whether youll be unemployed

Number of unemployed Americans by education:

Less than High School: 1.6 million High School: 3.6 million Some College: 3.1 million Bachelors or Higher: 2.1 million

Source: Bureau of Labor Statistics

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fewer skills have been shedding jobs, compounding problems

Take retail: the National Retail Federation expects seasonal hires to be level with last year at ~500,000, representing little growth

Source: McKinsey & Co., Bureau of Labor Statistics

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Unemployment is much worse for blacks and Hispanics

Unemployment as of October 2011:

Black: Hispanic: Asian: White:

14.3% 11.4% 7.3% 7.6%

Source: Bureau of Labor Statistics

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Regionally, difficulties persist in Pacific and South Eastern states

Areas associated with foreclosures have been particularly hard hit as the construction and housing industries stall Unemployment Rate December 2010

Source: McKinsey & Co., Bureau of Labor Statistics

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have come in states with strong energy industries, like Texas

The BLS reports that two-thirds of metro areas, or 249 regions, saw unemployment decline in September

12 Month Net Change in Unemployment Rate Through Sept. 2011 (seasonally adjusted)

Map by Eric Platt/Business Insider; Source: Bureau of Labor

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saw unemployment rates decline, including California, Florida and Michigan

Americans unemployed in the Midwest have had tremendous difficulty as turnover and job creation are increasingly slow

Unemployment Rate as of September 2011

States with highest unemployment:

1. 2. 3. 4. 5.

Source: Bureau of Labor Statistics

Nevada: 13.4% California: 11.9% Michigan: 11.1% D. of Columbia: 11.1% South Carolina: 11.0%

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Average length of unemployment has surged

Job creation has kept relative pace with the number of new additions to the labor force, keeping unemployment stagnant Mean duration of unemployment is currently 39 weeks 52% of unemployed Americans have exhausted federal benefits

ean Duration of Unemployment (In Weeks)

20 19 18 17 16 15 14 13 12 11 10

Source: St. Louis Federal Reserve, Bureau of Labor

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increased, but remains below the earlier part of the decade

3.5 million jobs posted this September was the highest in three years
Low set in July 2009 with 2.1 million openings

Source: St. Louis Federal Reserve

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corporate profits are at a record high, even as employment remains weak

S&P 500 components have reported third quarter net income of $207 billion, according to data provided by Bloomberg

Source: St. Louis Federal Reserve

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increased to $19.64, or 34% over the past decade in the private sector

At the same time, the average work week returned to 2001 levels of 34.0 hours. In 2009, the average week fell to 33.1 as companies laid off and furloughed employees

Source: St. Louis Federal Reserve

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Retail and hospitality professionals make the least

Source: Bureau of Labor Statistics

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jobless claims are close to their best levels since the crisis began

Last week, 390,000 new claims were submitted Four week moving average declined by 5,300 to 400,000

Source: St. Louis Federal Reserve

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The bad news, the total civilian participation rate is on a deep decline

58.4% of Americans are employed, the lowest percentage of the population at work since October 1983

Source: St. Louis Federal Reserve

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The so-called real unemployment rate is closer to 16%

In October 2009, a record high under-employment rate was set at 17.4% The Census Dept. estimates 46.2 million Americans were living in poverty in 2010, up from 43.6 million in 2009

Source: St. Louis Federal Reserve

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Youth unemployment is particularly bad

At the end of August, 18.1% of Americans aged 16 to 24 were counted as unemployed California alone has 545,000 unemployed youth 43% of young adults are not satisfied with their current level of employment

Source: St. Louis Federal Reserve

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getting less and less of the overall pie as income to GDP continues to fall

Wage and salary disbursements hit an all-time high of $6.7 trillion this year As a percentage of GDP, it declined to 44%, close to the all-time low set last October

Source: St. Louis Federal Reserve

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4.2 unemployed workers competing for every job opening

Thats on a decline, but still above the 2.8 average over the past decade and above 2 the number many economists note is needed for a healthy job market

Source: St. Louis Federal Reserve

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