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Alternative Measures of Unemployment

Minnesota's official unemployment rate tells us a lot about the share of people in the labor force who have untapped potential to offer. But it doesn't tell the whole story. We can learn more by looking at race, age, and gender, and by looking beyond the traditional unemployment rate. Please note that all data below are presented as 12-month moving averages.

Unemployment by race or ethnicity

When we break out unemployment rates by race, we find that some communities face greater challenges than others. Black unemployment has been cut in half over the past 12 months and was 7.9 percent in September—the very lowest rate seen in records dating back to December 2001. Despite the impressive decline, the Black unemployment rate is still more than double the White unemployment rate of 2.9 percent. Hispanic unemployment continues to rise from a low of 2.2 percent in October 2015, reaching 5.7 percent in September.

Minnesota unemployment rates by race or ethnicity as of September 2016:

  • Black or African American, 7.9 percent, compared to 16.1 percent 12 months ago
  • Hispanic or Latino, 5.7 percent, compared to 2.5 percent 12 months ago
  • White, 2.9 percent, compared to 2.8 percent 12 months ago
  • All workers statewide, 3.7 percent, compared to 3.8 percent 12 months ago

  Line chart shows unemployment rates by race as described above.

Also see the American Community Survey for a broader selection of unemployment data by race or origin, including White, Black or African American, Hispanic or Latino, American Indian and Alaskan Native, Asian, and more. Population profiles for all available races are available for download below. Note that the American Community Survey data are collected and calculated by a method which differs from the Current Population Survey numbers shown above.

American Community Survey 1-year Population Profiles for All Available Races in Minnesota:
2015, 2014

Unemployment by age and gender

We also find differences when we break out rates by age or gender. Teen unemployment edged downward from a summer high of 8.0 percent in August to 7.8 percent in September, remaining below the rates seen during the years 2003 through 2015. The unemployment rate among men rose gradually over the past year but has held steady at 4.5 percent during the past four months. The unemployment rate among women ticked upward a tenth of a point to 2.8 percent in September but overall continues a long downward trend from a summer 2011 high of 6.3 percent.

Minnesota unemployment rates by age and gender as of September 2016:

  • Teens (age 16-19), 7.8 percent, compared to 8.9 percent 12 months ago
  • Men, 4.5 percent, compared to 4.1 percent 12 months ago
  • Women, 2.8 percent, compared to 3.4 percent 12 months ago
  • All workers statewide, 3.7 percent, compared to 3.8 percent 12 months ago

  Line chart shows unemployment rates for teens, men, and women as described above.

The long-term unemployed

Long-term unemployment—lasting 27 weeks or more—imposes costs on people that go well beyond lost wages. Future earnings are lower, and health, relationships, and self-esteem can suffer.

Minnesota long-term unemployment as of September 2016:

  • Statewide number of long-term unemployed, 14,000 persons, compared to 23,200 persons 12 months ago
  • Statewide long-term unemployed as a share of total unemployed (U-3), 12.7 percent, compared to 20.5 percent 12 months ago

It is important to note that the percentage of long-term unemployed persons represents a share of unemployed persons only, while other unemployment rates represent a share of the entire labor force which includes all persons age 16 or older who are working or looking for work.

  Line chart shows number and share of long-term unemployed persons as described above.

Alternative measures of unemployment

We can learn still more about Minnesota's labor market by looking at alternative measures of unemployment defined by the U.S. Bureau of Labor Statistics. All rates were lower in September than 12 months ago, except the rate for U-6, which is a composite of all unemployed groups U-1 through U-6 together. The U-6 rate rose from 7.8 percent in September 2015 to 8.0 percent in September 2016, as the part-time underemployed rate rose over the same period from 3.2 to 3.5 percent.

Minnesota unemployment rates by alternative measures as of September 2016:

  • U-3 Officially unemployed, 3.7 percent, compared to 3.8 percent 12 months ago
  • U-4 Discouraged plus officially unemployed, 3.9 percent, compared to 4.0 percent 12 months ago
  • U-5 Marginally attached plus discouraged and officially unemployed, 4.5 percent, compared to 4.7 percent 12 months ago
  • U-6 Part-time underemployed plus marginally attached, discouraged, and officially unemployed, 8.0 percent, compared to 7.8 percent 12 months ago
  • Part-time underemployed—a component of U- 6, including only persons working less than 35 hours per week who want, but cannot find, a full-time job—is 3.5 percent, compared to 3.2 percent 12 months ago

  Line chart shows U-3 through U-6 unemployment rates as described above.

What do these measures mean?

The official unemployment measure, called U-3, is the share of the labor force aged 16 and over who, at the time of the monthly survey, have been unemployed for the past week and have looked for work sometime in the past four weeks.

But what about people who looked for work within the past twelve months but not in the past four weeks because they believed there were no jobs available that fit their qualifications? These marginally attached “discouraged workers” reveal additional untapped potential and are included in a broader measure called U-4.

And what if we add all the other marginally attached workers, people who looked for work sometime in the past twelve months but, for other reasons, did not look in the past four weeks? These other marginally attached workers expand the count still further in the U-5 measure.

And finally, U-6 includes all of the above and adds people who are employed part-time but want full-time work.

Looking ahead

Falling unemployment and underemployment mean that Minnesota’s economy is running closer to its full potential than before. By looking at race, age, gender, and additional measures of unemployment, we can see where there is still more work to be done.

Notes on using Current Population Survey state data:
Data above are presented as 12-month moving averages. Each monthly data point is an average of that month and the previous 11 months. Twelve-month moving averages are calculated differently than the official estimates of unemployment and should not be compared directly. Learn more about using CPS subnational data at

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