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Thursday, February 16, 2023
In 2022, the broadest measure of labor underutilization, designated U-6 (which includes the unemployed, workers employed part-time for economic reasons, and those marginally attached to the labor force), was 6.3 percent in Kentucky, not significantly different from the 6.9-percent rate for the nation, the U.S. Bureau of Labor Statistics reported today. Regional Commissioner Victoria G. Lee noted that 4 of the 6 alternative measures of labor underutilization in Kentucky were significantly lower than the rates recorded a year ago. Nationally, all six measures had significant decreases over the year. (See table 1. The Technical Note at the end of this release provides additional information on the reliability of estimates.)
The official concept of unemployment, U-3 in the U-1 to U-6 range of measures, includes all jobless persons who are available to take a job and have actively sought work in the past 4 weeks. In Kentucky, 3.8 percent of the labor force was unemployed, as measured by U-3 in 2022, compared to the national rate of 3.6 percent. (See chart 1.) (The official measure of unemployment in states is derived using a statistical model that incorporates data from the Current Population Survey [CPS] and other sources, and this model-based estimate can differ from the direct CPS estimate discussed here.)
Kentucky had 77,700 unemployed residents in 2022 according to the CPS. In addition, there were 35,700 workers who were employed part time for economic reasons (also known as involuntary part time). These individuals were working part time because of slack work or business conditions or because they were unable to find a full-time job. (See chart 2.) Nationwide, there were 3.93 million individuals working part time for economic reasons in 2022.
In 2022, the number of individuals considered to be marginally attached to the labor force in Kentucky was 16,900. People marginally attached to the labor force are not working, but indicate that they would like to work, are available to work, and have looked for work at some time during the past 12 months, even though they had not searched for work in the 4 weeks preceding the survey for reasons such as school attendance or family responsibilities. In the United States, the number of people marginally attached totaled 1.48 million in 2022.
Discouraged workers, a subset of the marginally attached, are persons who are not currently looking for work because they believe no jobs are available for them. In 2022, there were 3,600 discouraged workers in Kentucky, accounting for 21 percent of the marginally attached in the state. The U-4 measure, which adds discouraged workers to the number of the unemployed (expressed as a percentage of the labor force plus the number of discouraged workers), was 4.0 percent in Kentucky, compared to the 3.9-percent rate for the nation.State comparisons
In 2022, 13 states had rates significantly lower than those of the U.S. for all six measures of labor underutilization, while 5 states had rates higher than those of the U.S. for all six measures. (See table 2.)
The U-4 rate includes discouraged workers; thus, the difference between U-3 and U-4 reflects the degree of would-be job-seeker discouragement. At the national level, the difference between U-3 and U-4 was +0.3 percentage point in 2022. No state had a noteworthy difference between these two measures.
The U-5 rate includes all people who are marginally attached to the labor force, and U-6 adds those who are involuntary part-time workers. Therefore, the larger the difference between U-5 and U-6, the higher the incidence of this form of "underemployment." In 2022, 49 states and the District of Columbia had significant differences between their U-5 and U-6 rates. California had the largest gap (+3.4 percentage points), followed by Hawaii (+3.1 points) and Colorado and New York (+3.0 points each). At the national level, the difference between U-5 and U-6 was +2.4 percentage points.
Measures of labor underutilization saw more prevalent declines in 2022 relative to 2021, reflecting continued improvement in the national labor market. Thirty-four states and the District of Columbia had significant declines in all six measures over the year. For each measure, between 37 states and the District (U-6) and 48 states and the District (U-1) showed significant improvement over the year. The largest U-6 decline occurred in Nevada (-4.6 percentage points), followed by Hawaii (-4.4 points) and California (-4.2 points). Seven other states had U-6 rate declines of at least 3.0 percentage points. No state had an over-the-year rate increase in any measure.
The U.S. Bureau of Labor Statistics (BLS) produces six measures of labor underutilization based on Current Population Survey (CPS) data. Monthly, the BLS publishes these six measures for the United States in the Employment Situation news release. (See www.bls.gov/news.release/empsit.t15.htm.) State estimates, presented as 4-quarter averages, are provided each quarter on the BLS website. (For the most recent data see www.bls.gov/lau/stalt.htm.)
The official concept of unemployment (as measured in the CPS) is equivalent to the U-3 in the U-1 to U-6 range of measures. The other measures are provided to data users and analysts who want more narrowly (U-1 and U-2) or broadly (U-4 through U-6) defined measures.
The unemployment rates (U-3) in this release are derived directly from the CPS, because this is the only source of data for the various components of the alternative measures. As a result, these U-3 measures may differ from the official state annual average unemployment rates. The latter are estimates developed from statistical models that greatly improve the reliability of the top-side labor force and unemployment estimates. Those models, developed by the Local Area Unemployment Statistics (LAUS) program, incorporate CPS estimates, as well as input data from other sources. The model-based estimates are accessible through the LAUS home page at www.bls.gov/lau/home.htm.
The alternative measures for states are analyzed on a 4-quarter average basis in order to increase the reliability of the CPS estimates, which are based on relatively small sample sizes at the state level, and to eliminate seasonality. Due to the small state sample sizes, neither monthly nor quarterly statewide data from the CPS satisfy BLS publication standards. The analysis in this release is written with respect to statistical significance testing at the 90-percent confidence level for rate differences with respect to the U.S., sequential gaps in rates, and over-the-year changes in rates.
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|2021 (percent)||2022 (percent)||Percentage change, 2021–22||2021 (percent)||2022 (percent)||Percentage change, 2021–22|
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 (official concept of unemployment) (1)
U-4 Total unemployed plus discouraged workers, as a percent of the civilian labor force plus discouraged workers (2)
U-5 Total unemployed, plus discouraged workers, plus all other persons marginally attached to the labor force, as a percent of the civilian labor force plus all persons marginally attached to the labor force (2)
U-6 Total unemployed, plus all persons marginally attached to the labor force, plus total employed part time for economic reasons, as a percent of the civilian labor force plus all persons marginally attached to the labor force (2)
Note: An asterisk indicates that the over-the-year change is statistically different at the 90-percent confidence level.
District of Columbia
Note: See table 1 for definitions of measures. Statistical significance results at the 90-percent confidence level for rate differences between states and the U.S., for sequential gaps in state rates, and over-the-year changes are available at www.bls.gov/lau/stalt.htm.
Last Modified Date: Thursday, February 16, 2023