Unemploy-MAN-rate is worse than the Unemploy-WOMAN-rate

Mark Perry reports on why the unemployment rate for men in this great recession is notably higher than the unemployment rate for women.

30 years of Unemployment Data

This morning I wanted to look at the last 30 years of unemployment rate data. As you can see below from the chart from the bureau of labor statistics, there have been essentially 6 different peaks of unemployment during the last three decades.

What I wanted to compare was the trough-to-trough paths of unemployment rates during different recessionary periods (See Chart below).
Click on Chart for a Clearer Image

There are a few items of interest to me:

1) Typically, the unemployment rate rises faster and quicker than what it falls.

2) The worst unemployment seen in the last 3 years was 10.8% in late 1982 (Red Line)---And it took over 6 years for the unemployment rate to drop to cyclical lows in 1989.

3) The current recession (Green Line) has seen the quickest, steepest increase in unemployment of any of the six past cycles during the last 30 years. In 26 months, the unemployment rate has increased 5 percentage points. The previous cycle ranged from 1.6 percentage points to 3.6 percentage point increase in 26 months, with an average of 2.3 percentage point increase. That means that this recession has seen the unemployment rate increase 2x's the average rate during the first 26 months.

The chart below shows The Change In Unemployment Rate for the same cycles---since the chart above shows the actual unemployment rate, it's difficult to gauge the change in unemployment rate. The chart below more clearly shows that this recession has seen unemployment rates jump quicker than an other recession in the past 30 years and is just a few basis points away from being a bigger increase than what was seen in the early 1980's.

And you can rest assured that with the additional layoffs coming from GM, Chrysler and their dealers, the unemployment rate will cross 10% and be worse than the recession of 25 years ago.

Click on image for a bigger chart

1 in 6 American Workers Unemployed or Underemployed

The Bureau of Labor Statistics today reports that the unemployment rate was at 9.4%. This is the first time in 27 years that the unemployment rate has been since August 1983.
Click image for a larger chart

The U6 unemployment rate, which includes people working part-time jobs even though they'd rather be working full time, has risen by 0.6 percentage points in the month to 16.4%---That means that 1 out of every 6 American workers are either out-of-work or working part time jobs even though they want to work full time.

Since the start of the recession in December 2007, the number of Americans unemployed have increased by 7 million! You can read the entire jobs report here.

California's Unemployment Insurance Fund could be $18 Billion underfunded

The SF Gate reports that the state of California could see it's unemployment insurance system run an $18 billion deficit by 2010.

The state currently taxes employers ~$434/employee per year to fund the unemployment insurance trust fund---this calculation hasn't changed since the mid 1980's even though the average weekly payout to the jobless has increased to a maximum $450 per week of unemployment benefit.

The state which has already run into issues with balancing its books will defiinitely see legislators debate this issue---Either raise taxes on employers, cut benefits to the jobless, or both.

Tennessee Increases the Unemployment Insurance Tax by $100+/employee

According to Forbes, the state of Tennessee is going to be raising the taxes that imposes on employers in order to fund the state's unemployment insurance program.

The average tax per employee will rise by ~$108/year, as the tax rate is increased 0.6 percentage points and taxable wages are increased from $7,000/year to $9,000/year---However there is a provision to lower the tax once the unemployment trust fund crosses $900 million.