The Department of Labor reported an unemployment rate of 5.9percent for September 2014, a decrease of 0.2 percentage point. It reported an increase of 248,000 nonfarm jobs over last month. Employment for July was revised upward from 212,000 to 243,000 jobs created, and August was revised up from 142,000 to 180,000.
The number of unemployed people in September was 9.3 million, a decrease from last month’s figure of 9.6 million.
More than five years after the recession ended, the unemployment rate remains above the 5.2 to 5.5 percent range that Federal Reserve officials consider the long-run average, according to the Wall Street Journal.
The number of long-term unemployed, those unemployed for 27 weeks or more, remains at 3.0 million, accounting for 31.9 percent of the unemployed. The share of the long-term unemployed increased 0.7 percentage point in September from 31.2 percent. During the 1980s, when our country faced a similar recessionary period, the proportion of long-term unemployed never exceeded 27 percent.
The “real” number of unemployed Americans is 18.6 million. These are people who are unemployed (9.3 million), want work but have stopped searching for a job (2.2 million), or are working part time because they cannot find full time employment (7.1 million).
In September, there were 2.23 million workers deemed marginally attached to the workforce who want work but were not counted as unemployed because they had not looked for a job in the last four weeks. This is an increase of 85,000 from last month’s count of 2.14 million workers.
The “real” unemployment or U-6 rate is 11.8 percent, down 0.2 percentage point from August. This is the total percentage of unemployed and underemployed workers.
In September, employment grew by 81,000 in professional and business services; 23,000 in health care; and 35,000 in retail trade. Employment in the federal government decreased by 2,000; decreased by 14,400 in local government, excluding education; and decreased by 9,300 in transit and passenger ground transportation.
Labor Force Participation
The labor force participation rate is 62.7 percent, down 0.1 percentage point from last month and the lowest level in more than 36 years. Labor force participation is down 0.5 percentage point year over year. Prior to the recession the rate stood at 66 percent.
If the labor force participation rate were the same as when President Obama took office, the unemployment rate would be 10.2 percent.
The share of American adults with jobs in September was 59.0 percent, an increase of 0.3 percentage point over the year, and little changed for the last six months. This is more than four percentage points below its pre-recession peak.
Wages
Also of concern to economists is the stagnant growth in wages. Average hourly earnings for all employees on private nonfarm payrolls fell by one cent to $24.53. Average hourly earnings have risen by 2.1 percent year-over-year.
September was the 62nd straight month that year-over-year hourly wage growth has been below 2.5 percent. Prior to the recession, wage growth routinely exceeded three percent.
