Friday, March 04, 2011

Duration of Unemployment, Unemployment by Education, Diffusion Indexes

by Bill McBride on 3/04/2011 01:35:00 PM

By request, here are a few more graphs ...

Duration of Unemployment

Unemployment Duration Click on graph for larger image in graph gallery.

This graph shows the duration of unemployment as a percent of the civilian labor force. The graph shows the number of unemployed in four categories: less than 5 week, 6 to 14 weeks, 15 to 26 weeks, and 27 weeks or more.

In general, all four categories are trending down. The less than 5 week category appears to be back to normal (fits with the initial weekly claims data).

Unemployment by Education

Unemployment by Level of EducationThis graph shows the unemployment rate by four levels of education (all groups are 25 years and older).

Unfortunately this data only goes back to 1992 and only includes one previous recession (the stock / tech bust in 2001). Clearly education matters with regards to the unemployment rate - and it appears all four groups are now trending down.

Diffusion Indexes

Employment Diffusion Index This is a little more technical. The BLS diffusion index for total private employment was at 68.2 in February, the highest level since May 1998. For manufacturing, the diffusion index decreased to 64.2.

Think of this as a measure of how widespread job gains are across industries. The further from 50 (above or below), the more widespread the job losses or gains reported by the BLS. From the BLS:
Figures are the percent of industries with employment increasing plus one-half of the industries with unchanged employment, where 50 percent indicates an equal balance between industries with increasing and decreasing employment.
The level of both indexes was a clear positive in the February employment report.

What we want is a large number of high paying jobs added each month, spread across many industries. What we got was some improvement in jobs added, although not high paying jobs - but fairly widespread.

Best to all

Here are the earlier employment posts (with graphs):
February Employment Report: 192,000 Jobs, 8.9% Unemployment Rate
Employment Summary and Part Time Workers, Unemployed over 26 Weeks
Employment Graph Gallery

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