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Saturday, June 08, 2013

Graphs for Duration of Unemployment, Unemployment by Education and Diffusion Indexes

by Calculated Risk on 6/08/2013 06:25:00 PM

Yesterday on the employment report:
May Employment Report: 175,000 Jobs, 7.6% Unemployment Rate
Employment Report Comments and more Graphs

A few more employment graphs by request ...

Duration of Unemployment

Unemployment Duration 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.

The general trend is down for all categories, but only the less than 5 weeks is back to normal levels. 

The 6 to 14 weeks category declined to 1.7%, the lowest since May 2008, but this is still above the "normal" level of under 1.5%.

The long term unemployed is at 2.8% of the labor force - the lowest since May 2009 - however the number (and percent) of long term unemployed remains a serious problem.

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 generally trending down.

Although education matters for the unemployment rate, it doesn't appear to matter as far as finding new employment (all four categories are only gradually declining).

Note: This says nothing about the quality of jobs - as an example, a college graduate working at minimum wage would be considered "employed".

Diffusion Indexes

Employment Diffusion Index The BLS diffusion index for total private employment was at 59.8 in May, up from 55.6 in April.

For manufacturing, the diffusion index increased slightly to 45.7, up from 45.1 in April.

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.
Job growth for total private employment was fairly widespread in May.   This is a good sign for the economy.  However, for manufacturing, more companies were decreasing employment than adding jobs again in May.