The real unemployment rate – October 2019
Bottom Line: There’s a lot more to the employment report than just a couple of headline numbers. The last several months has proved the value of not overreacting to any one employment report. Especially when we’re already at the lowest unemployment rate in 50 years. Weaker reports might mean that hiring is really slacking off, or it might mean that the labor market is so tight it’s hard for employers to hire when they’re looking to do so. Throughout the first half of 2019, when we saw weakness in hiring it was generally the later. Friday’s employment report, wrapping up the third quarter of 2019 presented a picture of a strong economy that’s continuing to deliverer unprecedented opportunity.
First, the headline stuff.
- Unemployment rate 3.5% - down .2%
- +136,000 jobs
- Positive revisions from past months totaling +45,000 jobs
Top industries for hiring:
- #1 Healthcare
- #2 Professional and business services
- #3 Government
Important takeaways:
- The lowest unemployment rate since December of 1969
- Factoring in the positive revisions the real number was a solid +181k jobs
Now for the real unemployment rate once underemployed, long-term unemployed and marginally attached people are accounted for:
- Actual: 6.9% down from 7.5% in 2018
Other takeaways:
1. The real-unemployment rate continues to decline to near record low levels – Lowest since December of 2000.
2. Those unaccounted for in the base unemployment rate include 7 million Americans (1.3 million long-term unemployed, 4.4 million are underemployed & 1.3 million are marginally attached to the workforce).
3. There are only two months in American history with a lower real unemployment rate