Released November 6, 2009
RALEIGH, N.C. -- The unemployment rate receives the most attention as an indicator of the health of the economy. In North Carolina, this rate has been above 10 percent for most of the year. Yet does the usually stated unemployment rate give the most complete picture of the job market?
Mike Walden, North Carolina Cooperative Extension economist in the College of Agriculture and Life Sciences at N.C. State University, responds:
"As in all things, there are lots of ways to measure a concept, and unemployment is no exception. The official unemployment rate - the one that's around 10 percent - has a fairly strict rule that determines whether people are counted as unemployed. Most importantly, they have to be actively looking for work. If they don't have a job, they have to be sending out resumes; they have to be going on job interviews. If they're not doing those things, they're not counted as unemployed.
The government actually does include folks who aren't actively looking for work in alternative unemployment rates. And so when we look at those, we see - as you might expect - that the 10 percent rate for North Carolina actually becomes higher. For example, if you include those folks who don't have a job but are not actively looking for work, that would add about 1.2 percentage points to our state unemployment rate.
And then there's another measure, which includes folks who are actually working; however, they're working part-time because they can't find full-time work due to the economy. If you add those folks to the unemployment rate, that would add six percentage points to the unemployment rate. So we would be looking at an unemployment rate in the state of around 16 percent. So as with many things, it depends on what you want to measure, but clearly, there are many different ways to look at unemployment, and as you move up the scale, you also move up the scale in terms of the rate."
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http://www.ncsu.edu/project/calscommblogs/news/archives/2009/11/economic_perspe_485.html
