A total of seven states have passed the 10% unemployment rate as the Jobless Slump Spreads.
The number of U.S. states with a jobless rate exceeding 10 percent almost doubled in February as the worst employment slump in the postwar era spread.
Nevada, North Carolina and Oregon last month joined the four other states that had previously climbed above 10 percent, according to Labor Department data released today in Washington. Michigan, at 12 percent, remained the state with the highest unemployment rate, followed by South Carolina at 11 percent and Oregon at 10.8. California and Rhode Island bring the total number of states to seven.
Forty-nine states and the District of Columbia registered increases in the unemployment rate last month, led by Oregon, North Carolina and New Jersey, the Labor Department said. Nebraska was the only state to post a decrease after the rate jumped the prior month.
“It’s something we’re not accustomed to seeing in this country,” said Mark Vitner, a senior economist at Wachovia. “Double-digit unemployment rates are simply un-American.”
Expect The Situation To Get Worse
Un-American or not, expect the situation to get much worse. The “official” unemployment rate is currently 8.1% and poised to head higher.
Please consider Table A-12 as shown in Jobs Contract 14th Straight Month; Unemployment Rate Soars to 8.1%.
Table A-12 is where one can find a better approximation of what the unemployment rate really is. Let’s take a look
click on chart for sharper image
The official unemployment rate is 8.1%. However, if you start counting all the people that want a job but gave up, all the people with part-time jobs that want a full-time job, all the people who dropped off the unemployment rolls because their unemployment benefits ran out, etc., you get a closer picture of what the unemployment rate is. That number is in the last row labeled U-6.
The government is reporting 8.1% but a far better approximation is 14.8%. Many economists expect the “official” number to hit 10%. If and when that happens where will U-6 be?
U-6 minus U-3
The pattern is pretty unmistakable. In one year the official unemployment rate rose from 4.8 to 8.1 (3.3) while U6 rose from 9.0 to 14.8 (5.8).
Assuming U3 hits 10%, U6 is likely to be approaching 20%. How bad Michigan, California, Nevada, North Carolina, Oregon, South Carolina, and Rhode Island are by then is anyone’s guess.
These are depression level statistics.
Mike “Mish” Shedlock
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