Jobs are Going, Going...GONE!

Unemployment is in the eye of the beholder. This chart depicts three views of the unemployment rate in the U.S. over the past fifteen years. The rosiest scenario, naturally, is the line in red (so-called U3), which shows unemployment currently running at a little over 6%. U3, however, does not count workers laid off in the past year who have become too discouraged to look for a new job. Add those workers into the mix, and you get the U-6 calculation (in gray) of almost 12%.

Now, there is another segment of the labor pool, those discouraged workers who have been jobless for more than one year. These the Labor Department simply ignores. Youz guys don't exist. Add them back in, and now you're talking 16% unemployment (blue). With this figure likely surpassing 20% in 2009, get ready for more talk about the Next Depression.

In the River Valley, baseline unemployment has climbed past 8%, and the news is getting worse. The region's biggest employer, the NewPage coated-paper mill in Rumford, has just announced nearly a month of downtime for its #15 machine. Beginning December 8, at least 250 workers will be temporarily laid off--nearly one-fourth of the mill's workforce.

[update, December 5:]
This morning brought the Labor Department's monthly employment report, and the numbers are abysmal. 533,000 jobs were lost in November, the largest monthly slide since 1974; the loss in October was revised from 240,000 to 320,000. The total for 2008 now stands at 1.9 million jobs lost. The "official" unemployment rate (for what it's worth) ticked up from 6.5% in October to 6.7% last month.