Alternative Measures of Labor Underutilization for States, 2011
January 31, 2012
In 2011, Nevada again reported the highest rate for all six alternative measures of labor underutilization (known as U1 through U6).
The U-3 is the official rate of unemployment and the measure most typically cited in news about the economy. The broadest measure of labor underutilization, called U-6, includes the unemployed, the marginally attached, and persons who are actually employed but who work fewer hours than they would like (sometimes referred to as underemployed.)
The six state measures are based on the same definitions as those published for the United States:
- U-1, persons unemployed 15 weeks or longer, as a percent of the civilian labor force;
- U-2, job losers and persons who completed temporary jobs, as a percent of the civilian labor force;
- U-3, total unemployed, as a percent of the civilian labor force (this is the definition used for the official unemployment rate);
- U-4, total unemployed plus discouraged workers, as a percent of the civilian labor force plus discouraged workers;
- U-5, total unemployed, plus discouraged workers, plus all other marginally attached workers, as a percent of the civilian labor force plus all marginally attached workers; and
- U-6, 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.
Nevada's rates ranged from a U-2 of 8.5 percent to a U-6 of 22.7 percent, including a U-3 of 13.1 percent. California had the second highest rate for all six measures, including a U-3 of 11.6 percent. The next highest U-3 rate, 11.1 percent, was recorded in Rhode Island.
North Dakota continued to record the lowest rates for all six measures, including a U-3 of 3.6 percent. Nebraska and South Dakota had the next lowest U-3 rates, 4.5 and 4.9 percent, respectively.
Nevada, Michigan, New York, and South Carolina had the largest gaps between their U-3 and U-4 rates, +0.9 percentage point each. The large gaps for these four states are a reflection of their relatively high degrees of would-be job-seeker discouragement. In contrast, North Dakota had the smallest gap between its U-3 and U-4 rates, +0.1 percentage point.
The larger the difference between U-5 and U-6, the higher the incidence of this form of "underemployment." California posted the largest gap between its U-5 and U-6 rates, +7.7 percentage points, followed by Nevada, +7.2 points. North Dakota registered the smallest difference between its U-5 and U-6 measures, +2.4 percentage points.
The largest range across U-1 and U-6 among states was posted by California, +14.1 percentage points, followed closely by Nevada, +14.0 points. The next largest spreads were reported in Michigan and Washington, +12.7 percentage points each. North Dakota had the smallest range across its alternative measures, +5.4 percentage points.
These data on alternative measures of labor underutilization are from the Current Population Survey. Find out more in "Alternative Measures of Labor Underutilization for States, 2011 Annual Averages."
Bureau of Labor Statistics, U.S. Department of Labor, The Economics Daily, Alternative Measures of Labor Underutilization for States, 2011 on the Internet at http://www.bls.gov/opub/ted/2012/ted_20120131.htm (visited December 22, 2014).