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You are Here: Home > Blog > Unemployment Rate – September 2016

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Unemployment Rate – September 2016

Friday, October 7th, 2016

Job growth was a little slower than economists had forecast for September, but the number was still good. The unemployment rate ticked up a notch.

According to the most recent monthly report from the Bureau of Labor Statistics (BLS), the private sector netted 167,000 nonfarm job gains in September. Local, state and federal governments lost 11,000 jobs, resulting in 156,000 total net job gains. Economists had expected between 172,000 and 175,000 total job gains, according to various sources.

The BLS revised job gains for July and August 2016, showing that the economy netted 7,000 fewer jobs than the BLS had previously estimated for the two months. After that revision, job gains have averaged 192,000 per month in the past three months. So far this year, job gains have averaged 178,000 per month. They averaged 229,000 per month in 2015.

The unemployment rate ticked up from 4.9 to 5.0 percent in September, mostly because more unemployed workers entered or re-entered the job market.

The private sector has now gained nonfarm jobs for 79 consecutive months since the Great Recession, for a total of 15 million jobs. The unemployment rate has dropped 5.0 percentage points from the recessionary high of 10.0 set in October 2009. (More information about the unemployment rate is below.)

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Jobs in professional and business services rose by 67,000 in September and have risen by 582,000 over the year.

At 33,000, job growth continued in health care as it has for years. (The industry has averaged 37,083 jobs per month over the past year, for a total of 445,000.) Much of the industry’s steady job growth over the past few years is attributable to the increasing medical demands of aging baby boomers and the ever-growing obesity epidemic, and to provisions in the Affordable Care Act (“Obamacare”) as well.

Jobs in food services and drinking places continued to trend up in September by 30,000. The industry has added 300,000 jobs over the year.

Manufacturing, one of the standard measures of labor-market health, lost 13,000 jobs. Construction, also a measure of labor-market health, gained 23,000 jobs. (See Table B by the BLS for more job numbers listed by industry.)

Among the major work groups tracked by the BLS, teenagers again suffered the highest unemployment rate (15.8 percent) followed by Blacks (8.8), Hispanics (6.4), adult men (4.7), adult women (4.4), Whites (4.4) and Asians (3.9, not seasonally adjusted). No group experienced a significant change in their unemployment rate except for Hispanics, who saw an increase from 5.6 to 6.4 percent.

Workers who are 25 years of age or older and who have earned four-year college degrees or higher experienced a 2.5 percent unemployment rate in September, down by 0.2 percentage points from August. Those in the same age group and who don’t have high school diplomas suffered a much higher 8.5 percent rate, up significantly from 7.2 in August. (See Table A-5 by the BLS for more information about the unemployment rate by education level.)

Unemployment Rate 2008 to 2016
Unemployment Rate Chart 2008 to 2016

The unemployment rate has ranged from 4.7 to 5.0 percent so far this year, for a monthly average of 4.9 percent. Economists consider an unemployment rate of around 5.0 percent to be normal.

In order for the BLS to count workers as unemployed, they must have been actively seeking jobs in the four weeks preceding the count. The number of workers that the BLS counted as unemployed in September was 7.9 million, up slightly from 7.8 million in August. That’s why the unemployment rate ticked up.

The count of unemployed workers does not include those who are involuntarily working only part time and with fewer benefits, if any, such as no health insurance, because they can’t find full-time jobs or employers cut their work hours. The number of involuntarily part-timers in September was 5.9 million, down from 6.1 million in August.

The average workweek for all part-timers and full-timers in the private sector increased by 0.1 hour to 34.4 hours in September. Average hourly earnings increased by 6 cents to $25.79, after increasing by 3 cents in August. Average hourly earnings have risen by 2.6 percent in a year. For private-sector production and nonsupervisory employees, average hourly earnings increased by 5 cents to $21.68 in September, after increasing by 4 cents in August.

The unemployment rate also does not include “marginally-attached” unemployed workers. The BLS does not count them in the official rate because they stopped looking for work in the four weeks preceding the count, for reasons such as school attendance, family matters or their collective perception that there simply are no jobs — at least not for them.

The number of marginally-attached workers in September was 1.8 million, up slightly from 1.7 million in August. Among the marginally-attached, 553,000 were so-called “discouraged workers” because they gave up looking for work due to their shared perception that there are no jobs. That was down by 23,000 from the 576,000 that the BLS reported in August. (The BLS does not seasonally adjust any of the figures in this paragraph.)

The number of long-term unemployed workers — those who have been without jobs for 27 weeks or longer — was 2.0 million in September, the same as in June, July and August. These workers accounted for 24.9 percent of the unemployed. Standard state unemployment benefits last only up to 26 weeks without extensions.

If you are a recent victim of job loss or a reduction in work hours resulting from the high unemployment rate, then you might be eligible to collect full or partial unemployment benefits from the state unemployment office. You might also be eligible to continue your employer-provided group health insurance coverage through COBRA.

For more details about the September 2016 unemployment rate and job numbers, see the “Employment Situation Summary” by the BLS. The BLS plans to report the October 2016 unemployment rate and job numbers on November 4. To receive notification like the above automatically, subscribe to Employee Rights Blog for free.

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Except where otherwise noted, figures in this unemployment rate report were rounded and/or seasonally adjusted by the BLS, and are subject to revision by same (based on additional data that was not initially available). The unemployment rate chart pictured above was provided by the BLS.

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