Why does the government have 6 unemployment rates? Economist Gary Hoover sees the U-6 unemployment rate as a 'canary in the coal mine'.
The Bureau of Labor Statistics measures varying aspects of “labor underutilization” categorized as U-1 through U-6. When the March jobs report comes out in early April, Marketplace will note the new unemployment rate at the top of its newscasts, and what the Bureau of Labor Statistics describes as the official unemployment rate — identified as U-3 in the jargon of the agency’s statisticians.
The U-3 unemployment rate was 4.1% in February, up from 4% in January.
But buried in the monthly jobs report are five more unemployment rates, labeled U-1 through U-6. They measure various aspects of what the BLS calls labor underutilization. As of February, those rates ranged from 1.5% (U-1) all the way up to 8% (U-6).
Six rates to measure joblessness may seem like a lot. But they tell different stories about the labor market and whether it’s working for American households.
Take, for example, 25-year-old Aurora Azbill from Dayton, Ohio. She turned her passion for theater into a profession.
“I build costumes,” she said.
Azbill moved to New York City two years ago with a theater-tech degree and soon landed a job in a shop making costumes for movies, cruise ship theatricals and Broadway shows.
“While I had a 9 to 5, if Broadway is not doing any cast changes, nothing’s opening, hours get cut,” said Azbill. “I would walk in in the morning, my boss would be like, ‘Sorry girl. Like, we don’t have any work for you, you can go home. Maybe I’ll see you in two weeks.’”
When this happened, she’d try to find short-term freelance gigs to tide her over.
