U.S. Headline Unemployment (U3) at 7.6 pct, but Real Unemployment (U6) was 13.9 pct in January 2009

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While headline unemployment U3 reached a ghastly 7.6 percent in the U.S. during January 2009, the calculation of U3 has been massaged over the years to present a much rosier picture of the economy for political reasons. U6 which is also calculated by the United States Bureau of Labor Statistics has now reached an unbelievable 13.9 percent! U6 is the true indicator of unemployment in the economy, and it is much closer to the methodology used to calculate unemployment during the Great Depression.

What is even more shocking is the trajectory of U6 during 2008-2009.

The complete up to date data set can be found at the Bureau of Labor Statistics here.




David Rosenberg, Merrill Lynch