Real Unemployment Rate Hits 16.8%

Tyler Durden's picture

As markets digest the worse, yet somehow better, than expected 9.7% unemployment, the real state of the labor market is much worse, as indicated by the U-6 number, which has hit a recent record of 16.8% on a seasonally adjusted basis. As a reminder, the "U-6 represents total unemployed, plus all marginally attached workers, plus total employed part time for economic reasons, as a percent of the civilian labor force plus all marginally attached workers." In other words, in reality the U.S. labor market is likely about as bad as Spain in terms of undoctored jobless data.

And while pundits were touting the inflection point in June when U-6 hit 16.5% and started to retrace, the most recent monthly data has crashed yet another green shoot in the great propaganda game.

Source: BLS

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MinnesotaNice's picture

Arggghhh... did you have to insert that picture... I got the same feeling as when Kathy Lee Gifford pops up in Robo's postings... I think a the Romer picture should be a 3 point ding on your license to insert pictures on ZH  :-)

John Self's picture

Oh, it's a payoff all right.

pooplagrande's picture

Okay...can someone provide more info on this "woman"? She freaks me out every time I see her...everything is so cheery and rosey and smiley. I keep thinking she is going to pull an apple pie out of a hat.

Problem Is's picture

If Summers is Moe, Geithner is Larry and Bernanke is Curly... then Romer is Shemp.

TumblingDice's picture

I can't see anything behind those eyes.

Sqworl's picture

look at the size of this Cow, she ate whole stimulas...

MinnesotaNice's picture

ROTFLMAOWTIME... oh my gosh Squworl... I am usually really kind and tolerant of everyone's differences (and you of all people know that)... but that was really pretty funny... 

Sqworl's picture

The only difference here is that it takes 9,000 calories of protien to maintain that body.  I consume 1,100.  do the math, how much money does it take to feed the cow?  Its no different that having an obese Surgeon General...

It's friday and im in one of my somber moods with all this constant bs coming at me from all angles.  This is where I come to unload and make you laugh..x

Steak's picture

I'm from GA, the land of the side-hustle.  On top of that I have some very enterprising friends who have started and folded businesses before as part of this whole side-hustle culture.  Nobody I know even in the most peripheral sense has started a new business or hired anybody new in the past 6 months or longer.  Well actually I take that back, I know some people in Cali who are getting into the legal marijuana trade, but thats the extent of it :-) 

So yeah, I concur wholeheartedly that this whole b/d charade is quite the load of bull. 

nopat's picture

As a fellow Ramblin' Wreck and current ATLien, I concur.  If new-immigrant entrepreneurialism is any indication of economic health, it's been dead for about a year and a half.  Fortunate for us they aren't in the statistic anyway, or else we'd really be screwed!  Oh wait...

The only thing keeping the lights on in Atlanta right now is the fact that we're hubs for a lot of companies that staff some pretty stout folks, and even that's starting to errode.  All the GMAT and GRE shelves at B&N/Borders are suspiciously empty.

thegreatsatan's picture

because no one at CNBC is willing to ask any tough questions of any Obama admin mouthpiece. really, what do you expect from the TMZ of "business news"

Anonymous's picture

She has incompetent smile, not happy at all.

Anonymous's picture

Many of her economic papwers embrace Marxism. Why do you think she has the job?

Anonymous's picture

If I go gambling with $1,000, and the first day I lose $500, the next day I lose $300, that means I am on the right path, right? LOL

ShankyS's picture

That 16% number is also the number of US citizens that have a brain. Except that percentage is falling. 

che's picture

household survey 392k jobs lost
b/d model 112k jobs fudged
49k jobs downard revision for the last 2 months
workweek hours flat (these will have to go up way before employment improves)

wages are up according to the release, but that reflects 11% minimum wage hike in July
teenage unemployment 25.5%
very poor

Anonymous's picture

Birth death adjustments to keep the Hopium bubble going for those that don't look into the reality behind the spin and propaganda headlines

Fish Gone Bad's picture

We let another employee go last week. We have now futuresized the company by 40%.

Anonymous's picture

It's also important to note the increasing spread between the U3 (official) and U6 numbers over time. Starting from Jan '99, the spread between U3 and U6 has averaged 3.95%. For August, the spread is now 7.1%, matching its max value last seen in March. The amount of marginally attached and 'forced part-time' workers has grown steadily since early 2008.

KeyserSöze's picture

 Here is a nice chart...facts are a bitch (once again)

http://www.trivisonno.com/withholding-taxes-chart

 

 

Ivanovich's picture

An old boss of mine once said "don't confuse the issue with facts."  It's likely he was speaking about the market.

KeyserSöze's picture

That must have been cool to work at the White House...

mtremus's picture

This U6 number will hit 25% in the not to distant future and stay there for a very long time.

Anonymous's picture

Unemployment not important folks, please consider:

Spain rallies 20% despite collapsing economy & 18.5% unemployment!

http://www.marketwatch.com/story/with-highest-jobless-rate-spain-rallies...

asdf's picture

LOL

 

"We believe that the market has missed the simple fact that the unraveling of the Spanish market is structural and likely to far outlast the current macro-economic crisis," said Bienenstock.

Daedal's picture

T-i-i-i-i-me is on our side, yes it is.

Look, anyone who has taken history class in high school 'learned' about the Great Depression, and how Hoover (who was incorrectly defined as a free-market capitalist) was always quoted as saying that "The worst is over".

 

The exact same absurdities are propagated from the mouth of Dennis Kneale to the door step of the White house. It'll take a few more years for people to realize the truth. Don't forget, many people were in denial about their tech stocks, just like many people are in denial about their house values -- give it a few more years of unemployment numbers that refuse to contract, and that's when most people will see more clearly.

mtremus's picture

Exactly.  Nasdaq peaked at 5000 9 years ago.  Where is it today.

Anonymous's picture

Don't you mean T-i-i-i-i-my is on our side?

SWRichmond's picture

Is something going on with Deutsche Bank?

SWRichmond's picture

rumors (?), no substantiation; a German-speaking poster on another forum has cut-and-pasted concerns from an unknown German forum, no links, I can't confirm.  I thought I'd poke the assembly here and see if anything was known.

Cheeky Bastard's picture

i did the same thing with Banco Santander yesterday and got a nice feedback from Steak and PM; and someone mentioned that ING might go down. They also provided me with some link and data to verify my concern. But; lets speculate; we know Austrian banks are exposed to Eastern Europe; and most of the leverage came from German banks. It would not surprise me one bit if DB was in trouble. If you find out anything else; please post; I'm browsing trough some Spanish financial  forums in search for information concerning Banco; but haven't found nothing worth posting here.

Miles Kendig's picture

CB - I would like to get your read on a stab at this one. 

Is there a potential disruption in what I refer to as the great circle route of liquidity washing.  After all, many of the institutions that have been swirling in the mill are all players in this.  If I had a better understanding in deciphering open source data I would look at potential impingements coming from Russia (regardless of the Monaco flash for appearances), the rest of CCE as you suggest (with Sweden now at a negative rate, redirection?), potentially the Latin American narco flows (now that the US & Colombia have a pact in hand) and with the collapse in side flows from Africa.  Are there issues emerging with China's inability to maintain PSI on these lines, especially with the talk of China looking to re-no some of their commodity swaps?

I cannot but help thinking that somewhere along this 4-6 trillion pipeline there are issues developing.  Hence the ripple effects as the disrupted flow hits various "pumping stations".  Anyone with an understanding of flow & vibration harmonics in large liquid pipeline engineering considerations please chime in.

Sqworl's picture

News from Monaco friends...Russians no longer allowed to buy.  They inflated everything and  can no longer pay their bills.  Dubai is bust and no longer subsidizing.  It's a ghost town except for residents and tourist and even that has dropped off.

Cannes is experiencing sever downturn in festivals and conferences which has been the butter to the baguette.  Its global.. 

thegreatsatan's picture

Didn't you get the memo, its "Funemployment" not unemployement.

TumblingDice's picture

HA! That's rich. And a very useful trend IMO, although I am sure I am yet to fully grasp the implications.

Next thing you know the funempoyed are going to abandon the monetary system altogether. *crosses fingers*

FoolMeTwice's picture

I am sick of reading *extreme* arguments. Maybe the employments numbers are fudged, so the other extreme has to be true!

The truth lies somewhere in between. What defines civilian labor force? Households moving from two income to single income will result in high unemployment number.

What I am intersted in is the %age of household unemployed. In 1930s mainly the men worked. One person loses job and whole household lost the bread earner. So to what extent that is happening now? I wanna know that number.

ghostfaceinvestah's picture

When households depend on both incomes to maintain their lifestyle, does it much matter?

Anonymous's picture

Tyler wrote: "In other words, in reality the U.S. labor market is likely about as bad as Spain in terms of undoctored jobless data."

Another aspect where Spain and the USA are parallel is their respective stock markets' recoveries off the March bottoms. The ^IBEX, which is the Spanish equivalent of the DJIA, is up 66.9% from its 2009 bottom.

I have lived in Spain and we are there often. The Spanish economy is characterized by structural under and un-employment. Onerous labor laws discourage employers from hiring traditional full time employees, and a massive swath of 20-40 years olds are part-time workers, while 50 years olds are considered washed up. Once a woman hits 35, she is considered over the hill. Basically, it's a worker's nightmare and those who have jobs are underpaid. Still, their home prices managed to appreciate like 800% from 2000 through 2005, and have only modestly corrected (like 3%).

Apparently, the worse shape your economy is in, the more bouncy your stock market gets. What a mess.

Anonymous's picture

Tyler wrote: "In other words, in reality the U.S. labor market is likely about as bad as Spain in terms of undoctored jobless data."

Another aspect where Spain and the USA are parallel is their respective stock markets' recoveries off the March bottoms. The ^IBEX, which is the Spanish equivalent of the DJIA, is up 66.9% from its 2009 bottom.

I have lived in Spain and we are there often. The Spanish economy is characterized by structural under and un-employment. Onerous labor laws discourage employers from hiring traditional full time employees, and a massive swath of 20-40 years olds are part-time workers, while 50 years olds are considered washed up. Once a woman hits 35, she is considered over the hill. Basically, it's a worker's nightmare and those who have jobs are underpaid. Still, their home prices managed to appreciate like 800% from 2000 through 2005, and have only modestly corrected (like 3%).

Apparently, the worse shape your economy is in, the more bouncy your stock market gets. What a mess.

Anonymous's picture

Just imagine what the unemployment number would look like if Mugabe Jr. hadn't saved 500 million jobs.

Regards,
Nancy Pelosi

Problem Is's picture

Nice picture... Geithner on the left, Summmers on the right, Brenanke in the middle.

As for marginally attached by U3:

1.If you run out of unemployment benefits, you are marginally attached. You are no longer counted as unemployed by U3.

Are you any less unemployed?

2. If you are unemployed and there are no jobs in your occupation to apply for in your area, you are marginally attached and therefore not unemployed by U3.

Examples: Construction workers. In imploded bubble markets there is virtually no construction work. But construction workers often travel out of area or out of state looking for work. By this definition they are not unemployed by U3.

These questions are asked in the 60k monthly survey done by BLS as a factor in determining U3.

Are they any less unemployed?

We won't even get into the highly flawed birth/death ratio model that adds jobs from the small business market that supposedly were missed by other methods of BLS data. Bush used it to add a record 1.7 million phantom jobs to the 2007 totals. Obama is on pace to top that in 2009. In a typical month any where from 90k to 1.3 million job losses are subtracted from the totals because of supposed job creation in small businesses that could not be found in any hard data...

Like all of the above methods, what a great way to under report job losses or over report job creation for political gain...

Why doesn't the BLS use IRS payroll data streaming in monthly? Hard data? A good, often asked question by statisticians that goes unanswered...

The American public is so math deficient they could not understand a graph, statistic or ratio if you hit them in the head with it.

Anonymous's picture

http://www.calculatedriskblog.com/2009/09/unemployment-stress-tests-unem...

and now it is worse than the worst case scenario for the banks but still the banks share prices go up after all, they will just get more money from the fed anyway.

Can't fail, this is a riskless market now so forget shorting and just buy any junk you can

TumblingDice's picture

At the bar, people sometimes want to know about this "financial thing" and i indulge them. The first thing I point out is that all the statistics put out by the government are false. That one taes a while to fully sink in, because when they ask for the actual unemployment and I give them the 15% and now 16.8 U-6 figure they shake theire heads in wonderment.

"You can't just make shit up like that. That's way overboard."

"But if you count all the actually unemployed, including those who are no longer receiving unemployment enfits, then thats the number you end up with."

They go on to throw out a number in the 12% range to account for this becuase all of a sudden they're experts and then a light bulb blinks in their head that you have to measure unemplyment the same way you did during the Great Depression or else all this U-6 bullshit is just fearmongering. I mention Bill clinton's rule change on reporting and the conversation starts in earnest here. Next subject: mark to market and that gets people very very angry.

dot_bust's picture

I lost my job  in January when my employer did mass layoffs. Ever since then, I've been freelancing. Thank God I went nuts last year teaching myself CSS and Flash. Otherwise, I'd be shit out of luck. But, I'll tell you  one thing, the employment ads are crazy. They ask for a veritable laundry list of skills. My favorite is the one where they ask for CSS, JavaScript, XHTML, Flash, PHP, MySQL, 3DS Max, After Effects, SEO, and copywriting. What else? Why don't I stick the broom up my ass and sweep the floor?

Oh, and I forgot to mention, they were offering $30k - $40k.

Sqworl's picture

Unfortunately my friend, desperation sets in and people will work for minimum wage to feed their families.  I know several Ivy lawyers and bankers including seasoned professionals working as waiters in Major cities across the nation.

According to the architecture that is to frame the change of our once great nation.  They want it to collapse and seize it and socialise it.

They are well aware of how horrific unemployment and will only work to make it worse.  Look at our stock markets???

SWRichmond's picture

According to the architecture that is to frame the change of our once great nation.  They want it to collapse and seize it and socialise it.

They are well aware of how horrific unemployment and will only work to make it worse.

Yes.  Their actions drag out the pain, by preventing the cleansing wave of resets (defaults).  They are hoping desperation will bring people clamoring for a cultish government saviour, and are helping their biggest patrons use stolen taxpayer money to consolidate their empires.

Anonymous's picture

this administration is going to lie until we are all marching in the streets..........jobless recovery they all say with a big smile.............but they are losing their jobs too, just like our industry when there were only about 100 closed companies, the employed on the site were vicious that is until THEY WERE GONE TOO.

This is lava and it is going to hit all 50 states and hit people you know if not you directly. 20% UNEMPLOYMENT, WHAT DO YOU THINK THAT IS GOING TO DO TO THE FORECLOSURE NUMBERS.......

During the Depression NOT ALL PEOPLE LOST THEIR JOBS, but so many did that it wasn't pleasant for the ones still working.

This administration is WASTING IT'S TIME AND ENERGY TRYING TO MAKE A NAME FOR THEMSELVES WITH BRAND NEW SHINY PROGRAMS INSTEAD OF FIXING WHAT IS WRONG.

THAT STIMULUS BILL WAS PURE LEFT WING PAYBACK GARBAGE...........AND THE WORLD IS GETTING IT.........

GOODBYE OBAMA AND GOODBYE LYING DEMOCRATS AND FINALLY GOODBYE LYING STATE RUN MEDIA WHO ARE LOSING THEIR JOBS AS FAST AS OUR INDUSTRY DID...........

HOPE AND CHANGE HOPE AND CHANGE HOPE AND CHANGE

THAT EVIL BUSH WITH HIS 4% UNEMPLOYMENT AND HIS 14.5 STOCK MARKET AND TAX CUTS FOR EVERYONE...........EVIL EVIL MAN

REMEMBER 3 YEARS AGO ALMOST TO THE DAY WE TURNED OUR CONGRESS OVER TO THE DEMOCRATS............HOW'S THAT WORKING FOR US.............

Anonymous's picture

glad to know more people are finding out the truth