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Friday, July 6, 2012

What Was the Unemployment Rate When Obama Took Office (June 2012 update)

The following numbers are outdated.  Current numbers can be found at one of the links above.

What was the unemployment rate when Bush left office and Obama was inaugurated? 7.8%

What was the unemployment rate at Obama's first full month in office (February 2009)?  8.3%

How high did it go?  10.0%

What is today's (June 2012's) unemployment rate?   

How many people were looking for work when Obama was inaugurated, how many were working?  And how many people are looking for work and how many are employed now?
  • What Caused the Rise in Unemployment When Obama Took Office?  Did Obama caused the unemployment rate to rise?  (The answer  is below)
  • What Was the Unemployment Rate When Bush Took Office?  How high did it rise?  (The answer is also below.)  
Keep reading!


    The Unemployment Rate When Obama Took Office:
    • For the record, when Obama took office in January 2009, the "official" unemployment rate in seasonally adjusted numbers was 7.8%, with 12,049,000 people reporting themselves as unemployed and actively looking.  142,187,000 people were working in January 2009.*  (These numbers are adjusted slightly since original publication as the Bureau of Labor Statistics updates its numbers.  The original January 2009 unemployment rate reported by the BLS in February 2009 was 7.6%)  
    • In "raw" numbers not adjusted for seasonal variance, the unemployment rate was 8.5% with 13,009,000 people reporting themselves as unemployed and actively looking for work.  140,436,000 people were working in numbers not adjusted for seasonal variance.

    The Unemployment Rate at its Peak: 
    • At the "trough" (bottom in terms of jobs) of the recession in late 2009/early 2010, the "official" unemployment rate in seasonally adjusted numbers climbed to 10.0% in October 2009 with 15,421,000 people (out of a labor force of 153,822,000) reporting themselves as unemployed.   138,401,000 were working in October 2009; however, the lowest number of people working was reported in December 2009, when 137,792,000 people (in seasonally adjusted numbers) were working.    
    • In "raw" numbers not adjusted for seasonal variance, the unemployment rate reached a peak of 10.6% in January 2010 with 16,147,000 (out of a labor force of 152,957,000) reporting themselves as unemployed and actively looking for work.  Only 136,809,000 were working (in "raw" unadjusted numbers) in January 2010.

    The Unemployment Rate Now:
    • Now, in June 2012, the "official" unemployment rate in seasonally adjusted numbers is at 8.2%, with 12,749,000 (out of a labor force of 155,163,000) unemployed and actively looking for work.  142,415,000 people are working now.  (Last month 142,287,000 were working.  This is a increase of 128,000 people working in seasonally adjusted numbers.)  The unemployment rate  stayed exactly the same as unemployment increased by  29,000 and as 156,000 people entered the labor force in June.  (We have 1,754,000 more people in the labor force than we did in June 2011 and we have 3,030,000 more people employed than we did in June 2011.)  (The unemployment rate has now decreased .7% since October 2011.) 
    • In unadjusted "raw" numbers the unemployment rate is now 8.4%, an increase of .5% since May, but a decline of .9% (one-half of a percent) since June 2011, a year ago.  In "raw" real numbers, 13,184,000 (out of a labor force of 156,385,000) are unemployed and actively looking for work.  143,202,000 are working now in "raw" numbers unadjusted for seasonal variation.  (This is an increase of 475,000 people working since last month.)

    To Summarize the Unemployment Rate Now Compared to When Obama Took Office:
    • Using seasonally adjusted numbers, the unemployment rate was 7.8% (and rising quickly) when Obama took office, and it is 8.2% today.   12,049,000 were officially unemployed back then, and 12,749,000 are unemployed today.  
    • Using nonseasonally adjusted numbers, the unemployment rate was already 8.5% when Obama took office, and it is 8.4% today.   13,009,000 were officially unemployed in "raw" numbers back then, and 13,184,000 are officially unemployed in "raw" numbers now.
    What Was the Unemployment Rate When Bush Took Office in January 2001?
    • In seasonally adjusted numbers, the unemployment rate was 4.2% when Bush took office in January 2001.  6,023,000 people were officially unemployed at that time.    
    • In nonadjusted "raw" numbers, it was 4.7% when Bush took office in January 2001.  6,647,000 people were unemployed in "raw" numbers at that time.  
    • The adjusted unemployment rate went up to 6.3% by June 2003, and then it began to decrease.  That's an increase of 2.1% in 29 months.  That's a relative increase of 50% in 29 months before it turned down.  
    • It went down to 4.4% in late 2006 and again in May 2007, and then began to increase, reaching 7.8%, an increase of 3.3% by the time Bush left office. That's a relative increase of 75% in 20 months.      
    • The unemployment rate went from 7.8% when Obama took office and 8.3% during Obama's first full month in office to the peak of 10.0% discussed above before it turned down.  That's an increase of 2.2%.   That's a relative increase of 28% in 9 months before the unemployment rate turned down.
    • The following chart compares and contrasts the relative increase in the unemployment rate under Bush and Obama during their first 42 months (from inauguration until July of their respective fourth years in office).  The rate under Obama jumped up further in his first year in office, but came down more quickly.  Under both presidents, the unemployment rate comes down and goes up in any 3-6 month period.   

    What Caused the Rise in the Unemployment Rate When Obama Took Office?  Why has the Unemployment Rate Increased Since Obama Took Office?

    These are questions I have received in my email, and I thought I would answer these questions here. just mentioned, the unemployment rate was on its way up with a bullet starting in early 2008. The unemployment rate was 4.4% in mid 2007 before the full impact of the housing crash hit the labor market. Employment in construction hit a max in mid 2006 and had already started down by mid 2007, but most other employment sectors were not impacted. But by late 2007, the entire economy was starting to feel the impact of the housing crash. In a year and a half, from June 2007 until January 2009, the unemployment rate went from 4.4% to the 7.8% discussed above. 

    That's why we say that Obama inherited a rapidly-increasing unemployment rate. Why did it continue to rise after Obama took office? It takes a while for any government policy to take effect. Both TARP, the bank bailout signed by Bush in late 2008, and ARRA, the stimulus signed by Obama in February 2009, needed time to take effect, and that simply did not happen immediately. How long does it take to turn around the proverbial aircraft carrier vs. a speed boat? However, even though it took 9 months for the unemployment rate to max out (see below) and start decreasing, the rate of increase slowed down by June 2009.

    We can also think of the analogy of a fire: If a building is burning down, the fire department is called. It takes time for the fire department to put out the fire; it takes time for the fire to cool; it takes times for the debris to be hauled away. Only then can rebuilding start. And you certainly don't blame the fire department or the people who clean up the debris for the fire, do you? 

    The question, "What Caused the Rise in the Unemployment Rate After Obama Took Office?" really makes no sense... The unemployment rate was rising rapidly before Obama took office, and it took a few months for policies to kick in and stem the job bloodbath. A better question would be "What Caused the Rise in the Unemployment Rate Starting in 2007?" The answer to that would be the housing crisis and the resulting crisis in banks and lending institutions. But that is outside the scope of this article.

    What sources are you using for the unemployment data?

    All of my employment number reports and graphs are based on monthly reports and data published by the Bureau of Labor Statistics. Monthly numbers reports are based on the monthly Employment Situation Report and Database tables published at the website.
    The Employment Situation report includes month over month and year over year jobs numbers. 

    The database tables that I use for the numbers here are: 
    1. Employment Level LNS12000000 (Seasonally adjusted) & LNU12000000 (Unadjusted).
    2. Unemployment Level LNS13000000 (Seasonally adjusted) & LNU13000000 (Unadjusted).
    3. Unemployment Rate LNS14000000 (Seasonally adjusted) & LNU14000000 (Unadjusted). 
    You can find these tables by searching for these table numbers at the BLS website. My analysis is taken from the monthly BLS data copied to an Excel spreadsheet every month. I calculate detailed percentage increases/decreases, 3 month numbers, 2011 to date numbers, and I compare jobs numbers to those at the time of Obama's inauguration and at the "trough" of the recession.

    Updated 6/16/2012:  Someone left a comment:
    "The one thing none of these reports show nor do any of the Government reports, and that is the number of independent contractors that are unemployed or the number of unemployed that the benefits have run out and they gave up on trying. These added in would make these numbers on the reports look miserable."
    Both groups of people, the independent contractors, and the unemployed without benefits who are still actively looking for work ARE included in these numbers and are part of the reported unemployed.  ALL numbers of people who are unemployed, working part-time, or who "want work but haven't looked for work in the past month for some reason" have come down significantly over the past year to 18 months. 


    1. I think Clinton's policies that led to bad loans and bank problems are the #1 cause of our problems now.

    2. Anonymous, I would suggest that you get your head out of the right wing blogs, get your eyes away from Faux news, and get your ears away from right wing talk radio. The situation that led to the crash is very complex, but blaming it on Clinton is absurd.

    3. This comment has been removed by a blog administrator.

      1. "Stupid"... is an insulting word. Therefore I have elected to delete your comment. "Any comments that are in anyway insulting, caustic, or intentionally inflammatory will be deleted without notice."

    4. Lots of adjusting going on. I suppose that if you look at it long enough you can make anything work in your favor.

    5. Why do Republicans continue to say that 23 million Americans are out of work if your nu,beers suggest 12 million? Where are they getting that number from?

      1. It's an issue of definitions.

        Which of these groups of people would you consider unemployed other than people actively looking for work?
        People who are discouraged and have not looked for work for over a month? People who haven't looked for work for over a year? 16 year old high school kids who want to get a part-time job after school?

        Someone who says they want a job but they haven't applied anywhere, spoken to anyone, or made any phone calls about employment for the past month?

        People who haven't looked for work in the past month because they are ill? People who haven't looked for work for the past month because their car has died? People who are working part-time but want a full-time job?

        People who are retired? People who are home with young children?

        The constant definition of unemployment, the one that has been used for decades under both Republican and Democratic administrations, is that someone has to be actively looking for work, at least one resume, one application, one interview or contact, within the past four weeks to be considered officially "unemployed".

        There are alternate numbers of unemployment that include some of the groups I have listed, but they have ALWAYS been considered "alternate". The Republicans don't want to give Obama credit for anything, so they have now pivoted away from the usual and constant definition of unemployment to one of these alternate definitions of unemployment.

        And the "official" definition of unemployment does include 16 and 17 year olds who are looking for a part-time job after school. Of the 12,800,000 people officially looking for work, 2,000,000 of them are looking for part-time jobs. Of those 2,000,000, 500,000 are high school aged kids looking for part-time work during school. Another 300,000 are college aged kids looking for part-time work. If we didn't count these part-time kids, the unemployment rate would be 7.8%.

        But it's best to stick to calculations like this that are tried and true.

    6. I appreciate the time and effort you have put in doing the research and then passing it along to free thinking people. I have researched the same figures you have stated on here and they are factual.

    7. yes.. thank you..


    I appreciate intelligent comments and questions, including those that are at odds with anything posted here. I have elected not to screen comments before they are published; however, any comments that are in any way insulting, caustic, or intentionally inflammatory will be deleted without notice. Spam will also be immediately deleted.