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Commentary

Unpacking the June Unemployment Report

Last Friday, while most of America recovered from a long day of stars and bars reverie, the latest indication that the American economy is not in recovery dropped in the form of the June unemployment report. In a new commentary for Reason.org, I break down the numbers, which were not bad, but not good:

Official unemployment (U3) was unchanged at 7.6% from May to June. However, the more accurate measure of unemployment (U6) that includes workers who have recently been dropped from the labor force actually increased dramatically from 13.8% to 14.3%. In relative terms, that is a movement not seen in many, many months.

The nearby chart shows this increase in the U6 as out of step in recent months. But that is not the only thing to take away from the report. Consider also that both the labor force participation rate and the employment population ratio (which we discussed last month) technically improved by a tenth of a percentage point in June compared to May. But don’t get too excited — as the next figure shows both measures are still terribly low. Bureau of Labor Statistics data has a pretty high margin of error and a 0.1 percentage point shift is statistically insignificant. In practical terms the numbers remain the same as the last few months.

For the full analysis check out the commentary here.

Also see Adam Millsap’s discussion of D.C.’s recent bone headed choice to kill off job creation.

Anthony Randazzo

Anthony Randazzo is director of economic research for Reason Foundation, a nonprofit think tank advancing free minds and free markets. His research portfolio is regularly evolving, and he maintains a wide interest in economic policy at both a domestic and international level.

Randazzo is also managing director of the Pension Integrity Project, which provides technical assistance to public sector retirement system stakeholders who are seeking to prevent pension plan insolvency. His research focus on the national public sector pension crisis has a dual focus of identifying the systemic factors that cause public officials to underfund pension obligations as well as studying the processes by which meaningful pension reform can be accomplished. Within the Project he leads the analytics team that develops independent, third party actuarial analysis to stakeholders considering changes to public sector retirement systems.

In addition, Randazzo writes about the moral foundations of economic theory, and is currently developing research on the ways that the moral intuitions of economists influence their substantive findings on topics like income inequality, immigration, or labor policy.

Randazzo's work has been featured in The Wall Street Journal, Forbes, Barron's, Bloomberg View, The Washington Times, The Detroit News, Chicago Sun-Times, Orange-County Register, RealClearMarkets, Reason magazine and various other online and print publications.

During his tenure at Reason he has published substantive research on housing finance, financial services regulation, and various other aspects of economic policy at the federal level. And he has written regularly on labor economics, tax policy, privatization, and Turkish-U.S. political and economic issues.

Randazzo has also testified before numerous state and local legislative bodies on pension policy matters, as well as before the House Financial Services Committee on topics related to housing policy and government-sponsored enterprises.

He holds a multidisciplinary M.A. in behavioral political economy from New York University.

Follow Anthony Randazzo on Twitter @anthonyrandazzo