- A monthly report that shows the US unemployment rate is released by the Bureau of Labor Statistics (BLS) of the U.S. Department of Labor.
- The highest US unemployment rate was recorded in 1933, during the Great Depression.
- During the height of the Coronavirus pandemic in early to mid 2020, Nevada was hardest hit in the US, registering the highest unemployment rate at 30.1% in April and 25.3% in May.
Unemployment happens when a company goes through changes and decides to lay off employees or if employees quit and are yet to find employment. According to the official definition by the US Bureau of Labor Statistics (BLS) of the U.S. Department of Labor, people are classified as unemployed if they do not have a job, have actively looked for work in the prior 4 weeks, and are currently available for work.
A country’s unemployment rate is the percentage of the labor force that is unemployed and is used as an indicator of the economy’s health. When people are unemployed and remain without a job for an extended period, families lose wages and the country loses goods and services that could have been produced. Because there is a loss of income, these families will lose purchasing power thereby affecting businesses and causing further unemployment of other workers. The rate of unemployment usually rises as a result of things like recession, the introduction of new technology that may have introduced machines that replaced workers, or most recently a pandemic that shut down many industries causing mass layoffs.
If you are interested to learn more about unemployment, here are ten other things you may not know about it based on data by the US BLS.
10. A Monthly Report About The US Unemployment Rate is Released by The Bureau of Labor Statistics (BLS) of the U.S. Department of Labor
At the beginning of each month, the BLS releases the total number of employed and unemployed people in the US during the previous month. The report is published as a news release titled The Employment Situation, which includes graphs that plot figures showing the increase or decrease in employment or unemployment. It also includes a detailed explanation and some other important information about unemployment in the US like industries that lost the most number of jobs and those that have increased employment during the past weeks. At the end of the report, BLS includes a schedule of the release of the next report for those who want to keep track of the status of the country’s labor force.
9. Data About Unemployment is Collected Through The CPS
Many people think that the number of unemployed is determined by the number of people who apply for unemployment insurance (UI) benefits as part of the federal government programs, but using UI information can not be reliable since many are not eligible, some delay application, and others don’t apply at all. So the government instead conducts a monthly survey called the Current Population Survey (CPS) to collect data about unemployment in the country. This survey has been conducted every month in the US since 1940 and includes 60,000 households as a sample.
8. The Labor Force Survey Does Not Include People In Institutions
The number of employed and unemployed includes all people aged 16 and above but excludes people in institutions like a correctional facility or a residential nursing or mental health care institution. It also does not include all those in active duty in the Armed Forces.
The unemployment rate includes jobless people, those who are actively seeking work, and people who are available to take a job including workers who are waiting to be recalled after being temporarily laid off.
7. Total Unemployment Rates Are Higher During Certain Times Of The Year
According to the BLS, unemployment is higher in January and February, when it is cold in many parts of the country and work in agriculture, construction, and other seasonal industries are curtailed. Meanwhile, both employment and unemployment rise every June since at this time many students join the workforce looking for summer jobs during their school break. “The seasonal fluctuations in the number of employed and unemployed people reflect not only the normal seasonal weather patterns that tend to be repeated year after year but also the hiring (and layoff) patterns that accompany regular events such as the winter holiday season and the summer vacation season,” the BLS adds.
6. Unemployment Rate Differs From State to State
Under the BLS, the Local Area Unemployment Statistics (LAUS) program publishes a report showing the rate of unemployment and employment in 7,300 areas, including all states, counties, metropolitan areas, and cities of 25,000 population or more. It is important to study the rate of unemployment per state since these reflect local economic conditions. The LAUS also publishes news releases that indicate which states had the highest or lowest unemployment rate as well as figures reflecting nonfarm payroll employment.
5. The Highest US Unemployment Rate Was Recorded in 1933
The highest unemployment rate in the US reached a staggering 24.9% and was recorded in 1933 during the Great Depression. The latter was a severe worldwide economic crisis that happened in the 30s and lasted for 10 years. It is considered the longest and harshest worldwide recession in modern history.
In the US, the Great Depression started in October 1929 right after the stock market crashed. Over the next couple of years consumer spending dropped, there was a significant decrease in output from different industries, and eventually, companies that couldn’t keep up laid-off employees. It reached its lowest point in 1933 when an estimated 15 million Americans were left unemployed.
4. The US Maintained A Single Digit Unemployment Rate From 1941 to 1981, By 1982 It Cliimbed to 10.8%
After the Great Depression, the economy slowly made progress so much so that the US unemployment rates remained within a single-digit for many decades—from 1941 to 1981. But 1982 saw the first jump to a two-digit unemployment figure (10.8%) since 1941, a total of 12 million people in the US were jobless by the end of that year. This was the result of the 1981-1982 recession during which the manufacturing, construction, and auto industries were severely hit.
3. Unemployment Reached 10% During The Great Recession
Many economists believe that while the Great Recession started in 2008, the first signs that the US was headed towards that direction came as early as 2006 when housing prices began falling. Economic problems snowballed until the stock market crashed on September 29, 2008. At the height of the crisis housing prices fell 31.8 percent and in October 2019 unemployment rate reached 10%.
Rates improved slowly after 2009, steadily decreasing year by year until it reached a record low at a measly 3.5% during the US Goldilocks Economy of 2019.
2. The Coronavirus Pandemic Severely Affected The US Unemployment Rate, Nevada Was Hardest Hit
The deadly virus brought many economies to their knees, some industries were hardest hit, faced losses, and were forced to lay off hundreds if not thousands of people at the height of the pandemic. The lockdown meant to curb the spread of the virus, hurt many businesses especially small ones that were forced to shut down.
The earliest signs of the pandemic’s effect on the US unemployment rate came in March 2020 with a slight rise from 3.5% in February 2020 to 4.4 % the following month. But the steep climb, one of the steepest in recent records, came in April 2020 when it reached a staggering 14.7%. The hardest-hit industries were the hospitality, airline, and tourism industries.
Nevada had been hardest hit in all of the US registering the highest unemployment rate at 30.1% in April and 25.3% in May.
1. The US National Unemployment Rate Declined by 1.4% in May 2020
“The unemployment rate declined by 1.4 percentage points [at] 13.3 percent in May, and the number of unemployed persons fell by 2.1 million,” the BLS declared in its most recent report released on June 5, 2020.
The resumption of economic activity after easing restrictions caused a sharp increase in employment in leisure and hospitality, construction, education and health services, and retail trade according to the news release. “Among the major worker groups, the unemployment rates declined in May for adult men (11.6 percent), adult women (13.9 percent), Whites (12.4 percent), and Hispanics (17.6 percent),” the report added.