Real Unemployment Rate: 11.3%

In short: this is merely a favorite BLS gimmick to push the unemployment rate lower for purely political reasons (to the benefit of the administration that makes the content of your emails the most transparent to NSA workers, ever).

The problem is that this transitory fudging gimmick would be sustainable if the US population was no longer rising, however since there is no indication of any taper on the horizon, sooner or later, the historical labor force participation rate will have to be regained. Logically, when that happens, the unemployment rate will have no choice but to soar as the Labor Force soars month after month because sadly even the great welfare state of America has only so much funds it can allocate to an inert population that does no work and merely sits around all day long.

So how does the narrow unemployment rate (U-3, not to be confused with the wider, Underemployment U-6 rate) look if one applies a longer-term average Labor Force Participation rate of 65.8%?

In a word: not pretty. As of May, assuming realistic LFP assumptions, the real U-3 unemployment rate should have been not 7.6% but 11.3%.

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