What Percentage of the Unemployed Get Benefits?

(Note:  Updates for May 2012 in progress at end of article.)

The percentage of the "official" unadjusted unemployed for March 2011 who were getting benefits as of the week of March 12, 2011:  62.37%.  (8,770,443 out of 14,060,000).


The percentage of the "unofficial" unemployed for March 2011 who were getting benefits as of the week of March 12, 2011 is much lower:  30.19%.  (8,770,443 out of 29,047,000).


The number of people receiving benefits in March is taken from the Department of Labor's Unemployment Weekly Claims Report which includes the week of March 12.  This is a non-seasonally adjusted figure.  I use the March 12th figure as this is the week on which the monthly unemployment figures are based.  


The "official" unemployment number is the non-seasonally adjusted number for the month of March 2011, also from the BLS (Bureau of Labor Statistics) monthly situation report.   I explain my alternate unemployment figure of 29 million here, in another blog entry. 


A few comments on these numbers:


1.  Many people think that the unemployment rate only includes those who are getting benefits.  These figures should make it very clear that this isn't so.  Over one-third of the "official" unemployed (those who have looked for work in the past 4 weeks) are not getting benefits.  There is no connection between benefits and who is counted as unemployed.  (Explained here:  How the Unemployment Rate Is Calculated.) 


2.  It is highly unlikely that any new or re-entering workers are getting benefits.  In March 2011, there were 4,362,000 unemployed in these two categories (unadjusted).  Also, 657,000 said that they had quit their jobs vs. being laid off.   Most quitters do not qualify for unemployment benefits.  Therefore, the total of those entering, re-entering, or who quit their last jobs (but have looked for work in the past 4 weeks) is 5,019,000.


3.  That leaves 9,041,000 "officially" unemployed who have been laid off, most of whom probably qualify for benefits.  As only  8,770,443 people were getting benefits in mid-March, there are still at least 300,000 unemployed people who aren't getting benefits.  This is complicated by the fact that there are 8,737,000 part-time workers, some of whom are eligible for unemployment benefits depending on the state in which they live and how many hours they are working.


In summary:  There are hundreds of thousands, probably millions of people out there, who are unemployed because they were terminated, who are actively looking for work or who "want work", and who are not receiving any benefits.  The lowest number of people unemployed (because they were terminated), actively looking for work, and not receiving benefits is 300,000.  The highest number of people unemployed (because they were terminated), who "want work" and may or may not be actively looking for work, and who are not receiving benefits is somewhere around 6,521,000.    (That's 15,291,000 terminated minus  8,770,443 receiving benefits.).


As we watch the numbers of people receiving benefits go down every week, there is no obvious way of telling how many of these people are excluded from the numbers of those who are no longer receiving benefits because they have found employment and how many have exhausted all benefits (the much-maligned 99ers).  The number is somewhere between 300,000 and 6,521,000.  And, of those who have found employment, we know that 8,737,000 are working part-time because they can't get full-time work.  Those are still huge numbers!

Updates for May 2012 (in progress):

The percentage of the "official" unadjusted unemployed for March 2011 who were getting benefits as of the week of March 12, 2011:  62.37%.  (8,770,443 out of 14,060,000).

The percentage of the "unofficial" unemployed for March 2011 who were getting benefits as of the week of March 12, 2011 is much lower:  30.19%.  (8,770,443 out of 29,047,000).

The lowest number of people unemployed (because they were terminated), actively looking for work, and not receiving benefits is 300,000.  The highest number of people unemployed (because they were terminated), who "want work" and may or may not be actively looking for work, and who are not receiving benefits is somewhere around 6,521,000.    (That's 15,291,000 terminated minus  8,770,443 receiving benefits.).

Monthly Unemployment Report for March 2011

June 2012 unemployment rate and jobs numbers will be released Friday, July 6th.  Check back then!

Latest employment and unemployment reports can be found HERE!

The following report is for March 2011.   For current numbers, click on the link above. 

Unemployment Rate Continues to Decline, but....

The mainstream headlines express excitement about the new job numbers: "Stocks move higher as jobless rate falls", "Unemployment rate falls again as Job Growth Picks Up."

Two things are true: First, there are over a million more people who are reporting that they are working this March since last March. In fact, there are 900,000 more people who are reporting that they are working since February, just a month ago. Those are unadjusted numbers, not accounting for usual seasonal variations in the job market.

Seasonally adjusted "official" unemployment rate at 8.8%, unadjusted "official" at 9.2% but.....

In adjusted numbers, there are 900,000 more people working since March 2010, and 300,000 more working since February 2011.  The mainstream unemployment rate now stands at 8.8%, down from 9.7% a year ago.  The mainstream unadjusted rate now stands at 9.2%; it is usually about .5% to .7% higher than the adjusted rate. 

Secondly, the number of jobs reported by business has gone up by similar numbers: 1,300,000 new jobs "non-seasonally adjusted" between March 2010 and March 2011; 900,000 new in just the last month. In the "seasonally adjusted" buckets, there are 1,300,000 new jobs over the past year, with 200,000 new jobs reported over the past month.

More People are Returning to Work but........

O.K., O.K., this seasonally adjusted stuff sometimes makes it all sound like a shell game. But there are no two ways about it, more people are working this year than last, and more people are working this month than last. That's good, especially for those one million people who have found jobs over the past year.

In terms of unemployment, there are 1,600,000 fewer "officially" unemployed this month than there were a year ago and 500,000 fewer "officially" unemployed now than there were last month.

400,000 more people are now considered in the "civilian labor force" than a month ago, but there are still 600,000 fewer people in the "civilian labor force" than a year ago. Many of the people who left the labor force over the past two years to "sit it out" are are still sitting.

Alternate Employment Rate Falls to 18.2%

Last month, February, there were 29,580,000 people who were unemployed, underemployed or who "wanted to work", representing 18.6% as an alternate unemployment rate (unadjusted for seasonal variations). Let's compare that with March:

14,060,000 officially unemployed, 6,250,000 "want a job", and 8,737,000 part-time who want full-time. That adds up to 29,047,000 out of an "unofficial" civilian labor force of 159,272,000 for an "unofficial" unemployment rate of 18.2%. That is better than it was last month.

Let's be Cautious

So should we break out the champagne yet? Well, no, of course not. 29 million people is still a very large number of people who want work (or who want to work full-time) and aren't doing so. And we need to remember that this number doesn't include people who are working temp jobs and people who have returned to work at much lower rates of pay.

Also, of those 29,000,000 only 8,770,443 people are receiving unemployment benefits. (This number from the DOL weekly report.)  We have no idea who the people are who aren't receiving unemployment benefits.  Some are certainly new grads entering the market, some are people re-entering the job market, and some are most certainly 99ers.  But there is no breakdown or accounting of those who are unemployed but not receiving any unemployment benefits.

As Paul Krugman mentions, the "participation rate" (the number in the civilian labor force compared to the total civilian non-institutional population) is low and it has gone down over the past year. It appears to be stuck now, at 64.2% over the past three months. The employment population ratio (ratio of people employed compared to the number of people in the civilian non-institutional population as a whole) appears to have bottomed out at 58.5%, but it is now stagnant.

Interestingly enough, it is not an increasing number of people over 65 who are contributing to this lower number in the participation and employment-population ratios; in fact, the participation rate and the employment-population rate in the over-65 age cohort (of those who are not disabled) has actually increased over the past year, from 22.1 to 22.6% and from 20.6 to 21.2% respectively. The employment population ratio for those age 16 to 64 not disabled has edged up slightly.

But the participation and employment-population ratios of the disabled have gone down over the past year, and the unemployment rate for this group has continued to go up. One can surmise that, as it continues to be harder for those who are disabled to find work, they are more likely to leave the labor force.

The number of people working part-time for economic reasons (those can't find full-time work) dropped over the past year, but that number has ticked up by close to a 100,000 since February. It's unclear what that number may do long-term. We will just have to wait and watch.

Long-term unemployment

The most problematic statistics, however, are those related to long-term unemployment. The average duration of unemployment continues to climb with 45.5% of the unemployed out of work 27 weeks or longer for another new record.  This indicates that those who were laid off the earliest are having the most difficulty re-entering the work force. The average "official" unemployed person is now unemployed 39 weeks, also a new record. The numbers that reflect the status of the long-term unemployed just continue to go up, indicating that these people will be the last to be hired back to work.   6,161,000 people have been unemployed for more than 26 weeks, and that doesn't include those who are discouraged or "want a job" but haven't looked in the past four weeks.     

Deficits and the Future

We have deficit hawks who are insistent on cutting government jobs, and we have state governments who are struggling with staggering budget deficits. 

The biggest drop in employment in March 2011 was in the local government sector.  Local schools report a decrease of 9,200; other local government reports a decrease of 8,000.  We can expect more people who are laid off from government jobs to start hitting the unemployment rolls in the next few months.  The more government workers who are laid off, the more private sector workers may lose their jobs as the repercussions of this echo through the economy.

My deepest concern continues to be that, as people straggle (not rush) back into the workforce, we as a nation will forget that so many are still unemployed and that so many are working for much less than they were before all of this began. People will be relieved they have money to spend and, while they will still be cutting back to adjust to their new lower wages, they won't think very much about how we got into this mess and what it says about our country in general.

Watch for my analysis of breakdown by sector, the winners and losers of this month's employment roulette, in the next few days.