This document discusses how the unemployment rate in the United States is measured. It provides statistics on unemployment rates from 1980 to 2020, showing rates were highest during recessions. The unemployment rate is calculated using data from the Current Population Survey conducted by the Census Bureau and Bureau of Labor Statistics. To be counted as unemployed, a person must be at least 16 years old and actively seeking work. Those who are underemployed or discouraged workers are not included in the unemployment rate.

1. Unemployment Rate
Measuring the Workforce
Federal Reserve Bank of San Francisco
Economic Education
Date last updated: September 14, 2020
DATAPOST

2. Unemployment Rate – Did You Know?
7.1
5.6
4.0
9.6
3
6
9
12
1980 1990 2000 2010
The Census
Bureau conducts
the CPS, and the
Bureau of Labor
Statistics (BLS)
uses the results to
report the official
Unemployment
Rate
The official U.S.
unemployment
rate is measured
using data from
the Current
Population
Survey (CPS) Sources: Bureau of Labor Statistics
& FRBSF Calculations
U.S. Unemployment Rate
(% values, averages for years shown)
The official U.S. unemployment rate
averaged 9.6% in 2010 compared to
an average of 4.0% in 2000.
www.frbsf.org/education/teacher-resources/datapost FRBSF Economic EducationDATAPOST

3. Measuring Unemployment
99.7
147.3
13.6
Totals in millions, values seasonally adjusted
Unemployed
Employed
Not in
labor force
As of August 2020, unemployment
was 8.4% of the labor force
To be counted in CPS employment
data, surveyed persons must be
age 16 or older
“Unemployed” includes surveyed
persons who are jobless and
actively seeking a job
Surveyed persons who are neither
“employed” nor “unemployed” are
considered “not in the labor force”
Source: Bureau of Labor Statistics
Note: Components may not add to totals due to rounding.
www.frbsf.org/education/teacher-resources/datapost FRBSF Economic EducationDATAPOST

4. Types of Unemployment
Structural
• Mismatch between
the skills of
unemployed
workers and the
skills needed for
available jobs
Frictional
• The time between
jobs when a worker
is searching for a
new job or
transitioning from
one job to another
Cyclical
• Directly related to
business cycle
swings, like
expansions or
recessions
Who Is NOT
Counted as
unemployed?
The Underemployed
Those with part-time or
seasonal jobs who would
rather have full-time jobs.
Discouraged Workers
Those who have officially
given up looking for work
and are discouraged.
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5. 0%
2%
4%
6%
8%
10%
12%
14%
16%
1980 1984 1988 1992 1996 2000 2004 2008 2012 2016 2020
Source: Bureau of Labor Statistics
Note: Gray bars indicate NBER recession dates
Unemployment Rate
Seasonally adjusted (%), Jan. 1980–Aug. 2020
www.frbsf.org/education/teacher-resources/datapost FRBSF Economic EducationDATAPOST

6. 0%
2%
4%
6%
8%
10%
12%
14%
16%
1980 1984 1988 1992 1996 2000 2004 2008 2012 2016 2020
Oct. 2009
10.0%Nov. 1982
10.8%
Jun. 2003
6.3%
The Great
Recession
Source: Bureau of Labor Statistics
Note: Gray bars indicate NBER recession dates
Annotated Chart Notes
Unemployment Rate
Seasonally adjusted (%), Jan. 1980–Aug. 2020
www.frbsf.org/education/teacher-resources/datapost FRBSF Economic EducationDATAPOST
Apr. 2020
14.7%

7. What Do You Think?
1. In which years was the unemployment rate
around 10%?
2. Are discouraged workers counted as
unemployed? Why or why not?
3. What seems true about the relationship
between unemployment and economic
recessions?
4. Why would a survey be needed to calculate
the rate of unemployment?
www.frbsf.org/education/teacher-resources/datapost FRBSF Economic EducationDATAPOST