Good Job News - U-6 Down Nearly 2 Percentage Points

The U-6 Unemployment Rate Since 1994. FRED Chart by FR Bank of St.
Louis. The rate fell in December to 11.1 percent, not seasonally adjusted.

The year 2014 is the best for U.S. job growth in 15 years. The BLS announced today growth of 252,000 U.S. jobs in December plus a total of 50,000 jobs added as adjustments to prior two months. Continuing the November pattern, job growth in December was strong in professional and business services, construction, food services and drinking places, health care, and manufacturing.

The unemployment rate in December was the lowest in six years, down to 5.6 percent from 5.8 percent. A rate that falls below 6 percent is ordinarily a warning of inflationary pressures, and like a Greek statue the Federal Reserve remains poised to reduce its efforts to stimulate the economy through low interest rates. However, wages remain depressed, economic problems in Europe are a drag on future growth, and the bond-market rooms of the global financial casino - where the smartest players are rumored to hang out - don't seem to worry about a rise in long-term interest rates.

Alternative measures of unemployment and labor utilization show improvement, especially U-6, which fell 1.9 percentage points between December 2013 and December 2014. (Jason Furman, Chairman of the President's Council of Economic Advisers, this morning, in his comments on the data from The White House, shows a 1.8 percent drop, presumably because the White House is working with more precise data.) This suggests a significant drop in those employed involuntarily part-time, for economic reasons, another sign of a cyclical recovery.

Alternative Measures of Unemployment and Labor Utilization

Measure	Not seasonally adjusted			Seasonally adjusted
	Dec. 2013	Nov. 2014	Dec. 2014	Dec. 2013	Aug. 2014	Sept. 2014	Oct. 2014	Nov. 2014	Dec. 2014
U-1 Persons unemployed 15 weeks or longer,  % of the civilian labor force	3.5	2.7	2.5	3.6	2.9	2.8	2.8	2.7	2.6
U-2 Job losers and persons who completed temporary jobs, % of the civilian labor force	3.5	2.7	2.8	3.5	3.1	2.9	2.8	2.9	2.8
U-3 Total unemployed, % of the civilian labor force (official unemployment rate)	6.5	5.5	5.4	6.7	6.1	5.9	5.7	5.8	5.6
U-4 Total unemployed plus discouraged workers, % of the civilian labor force plus discouraged workers	7.0	5.9	5.8	7.2	6.6	6.3	6.2	6.2	6.0
U-5 Total unemployed, plus discouraged workers, plus all other persons marginally attached to the labor force, % of the civilian labor force plus all persons marginally attached to the labor force	7.9	6.8	6.7	8.1	7.4	7.3	7.1	7.1	6.9
U-6 Total unemployed, plus all persons marginally attached to the labor force, plus total employed part time for economic reasons, % of the civilian labor force plus all persons marginally attached to the labor force	13.0	11.0	11.1	13.1	12.0	11.7	11.5	11.4	11.2
NOTE: Persons marginally attached to the labor force are those who currently are neither working nor looking for work but indicate that they want and are available for a job and have looked for work sometime in the past 12 months. Discouraged workers, a subset of the marginally attached, have given a job-market related reason for not currently looking for work. Persons employed part time for economic reasons are those who want and are available for full-time work but have had to settle for a part-time schedule. Updated population controls are introduced annually with the release of January data. Source: BLS.