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Friday, August 3, 2012

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

The numbers below are outdated.  For current reports, click either of the links above.

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

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

What was the unemployment rate at peak?  10.0%
What is today's (July 2012's) unemployment rate?   8.3%

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?  Obama caused the unemployment rate to rise?  (Continue reading; the answer  is below.)
  •  What Was the Unemployment Rate When Bush Took Office?  How high did it rise?  (The answer is also below.)  
The following chart shows unemployment in three month intervals:

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 July 2012, the "official" unemployment rate in seasonally adjusted numbers is at 8.3%, with 12,794,000 (out of a labor force of 155,013,000) unemployed and actively looking for work.  142,220,000 people are working now.  (Last month 142,415,000 were working.  This is a decrease of 195,000 people working in seasonally adjusted numbers.)  The unemployment rate  increased by one tenth of a percent as unemployment increased by  45,000 and as 150,000 people left the labor force in July.  (We have 1,655,000 more people in the labor force than we did in July 2011 and we have 2,770,000 more people employed than we did in July 2011.)  (The unemployment rate has now decreased .6% since October 2011 and has decreased .8% since July 2011 .) 
  • In unadjusted "raw" numbers the unemployment rate is now 8.6%, an increase of .2% since June, but a decline of .7% since July 2011, a year ago.  In "raw" real numbers, 13,400,000 (out of a labor force of 156,526,000) are unemployed and actively looking for work.  143,126,000 are working now in "raw" numbers unadjusted for seasonal variation.  (This is a decrease of 76,000 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 8.3% today.   12,049,000 were officially unemployed back then, and 12,794,000 are unemployed today.  
  • Using nonseasonally adjusted numbers, the unemployment rate was already 8.5% when Obama took office, and it is 8.6% today.   13,009,000 were officially unemployed in "raw" numbers back then, and 13,400,000 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.  ALL numbers of people who are unemployed, working part-time, or who want work have come down significantly over the past year to 18 months.


  1. Regarding the analogy of the fire department: you certainly would blame the fire fighters if over half of them stood around and did nothing or got in the way of those trying to help.

    1. That would be the Republican Congress, right?

    2. All I can say is thank you middle Molly.

    3. Middle Molly, you don't sound so middle. Thank you for the statistics though. I really do appreciate them and hope that whoever is elected will turn this economy around so that our children's children will not have to pay off the debt that we created. Thanks again.

    4. The spending is the only thing keeping demand up. I know that if I got laid off it would really suck if the government told me "We can't pay you your unemployment because we didn't get enough revenue due to the lack of jobs. Bottom line: Spending cuts now = Less money in consumer hands = Less goods and services purchased = More job loss. Now this is all ok if you believe it's best to let the economy hit rock bottom and let it find its own way back up but just remember there was no end in sight to the great depression until painful spending started for the war effort....I am in the middle also and believe in cuts to pork and supply side investment(trickle down) but there is a time for it. When the economy is strong and everyone's working with lots of money to spend, tax cuts to the upper portions of society does expand businesses and create growth because people have the money to buy the products of the expansions. Right now trickle down does not work. Businesses have over two trillion in capitol just setting there and their not going to hire and expand if people aren't going to purchase the extra goods being produced. We have to keep as many people working as possible and every cent of spending cuts now will directly slow our economy down even more. Hopefully if spendings cuts do happen after elections our economy can handle it.

  2. Thank you Molly, I find your stats right on and yes, very middle of the road. Harder to find good facts these days, and that was enlightening. keep up the good work.. Mike...

  3. Middle Molly should change her name to The Left of Middle Molly.

  4. I found this a very good and informative site. I believe it was your true intent to be honest and I hope that that truly is the case. It is hard to find unbiased information these days. Although, I do think your bias is apparent, I believe you tried not to let it affect your information (I hope I'm correct in that). That being said, I want you to know that I am NOT a democrat nor am I for Obama for many, many more reasons than what is discussed here. I was very interested to see that you cite the housing crash as the basis or beginning of the economic problems that we are experiencing today. I agree but I suspect not for the same reasons as you. I remember when it was happening and what it was all about and how many speculated that what we are experiencing today would most definitely occur if we continued in the vein we were going, and they were right, it did happen. One thing I know and would like you to know, is that it wasn't the Republicans (though, they were not innocent) that initiated it but rather Bill Clinton and the democrats. Just check it out by doing a search for “The National Homeownership Strategy: Partners in the American Dream” you will see it was his plan which he vigorously promoted. It continued on in the Bush administration often times with Democrats standing in the way of it changing. Although, it was touted as a good thing, it really was a strategy to bring our economy down and break us from within. Bill Clinton is not the saint many democrats think he is but rather, he is part of a wider scheme to bring socialism into this country and bring us under governmental control. First they throw out a few bread crumbs and when we enter the trap they take it from there. Don't give up your American rights or believe unrealistic promises that cannot be kept. Keep your eye on the Constitution and what IT stands for. That is where our strength lies. If we give up those rights little by little under the guise of "political correctness" then one day we will look up and they will ALL be gone and the American Dream and freedom will be over!! I realize there are no PERFECT choices for president BUT we must go for the ones that strongly support the Constitution and defend America on all counts. They will be our BEST choices in the long run. This is the best country in the world and it is based on our Constitution. We do make mistakes but the Constitution is like a plumbline which keeps bringing us back to center. Don't lose sight of it. We have no rights without it. God Bless you and God Bless the United States of America!!


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.