Quote:
Originally Posted by PR_Tom
Isn't it true that if we calculated unemployment the same way they did in 1930, we'd be at double digit unemployment easily?
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The thing to understand about current unemployment data is there are 6 different definitions of unemployment and then you have seasonally adjusted figures and non-seasonally adjusted. The definitions run from U-1 to U-6. There are seasonal adjustments because it is easier to compare for example December to January when the effects of Christmas hiring are removed.
The common definition used in the United States is U-3. The current non-seasonally adjusted unemployment numbers run from 3.1 to 15.4% depending on which definition you use. The common definition (U-3) is currently 8.5%. The seasonally adjusted numbers run from 3% to 13.9% and the headline U-3 number is 7.6%.
Unemployment data before 1940 is just educated guesswork. There is no reliable way to compare data across 1940 though there was a census of sorts in 1937. Since 1940 there has been the "Current Population Survey"; a rather large reliable survey. The basic definition of unemployment that you hear about today has not really changed much since 1940 though occasionally the question has been changed slightly. Like asking "Are you looking for a job" vs "Were you looking for a job last week"? There is one study that shows you should add .2% to today's unemployment figures to compare to numbers before the 90s. This is because there were changes to the way the survey was collected and it seems to have introduced a negative .2% bias in the data.
To me the best way to look at the data and say, compare recessions, is to look at the baseline numbers before, after and during the recessions. How much do they change?